California Cell Phone Reimbursement Law 2024 – Know Your Rights

Many Californians may be unaware of the California cell phone reimbursement law. This area of law, although it is frequently under-utilized, is still an important concept to understand. Employees are protected from being exploited by their employers in the form of their cell phone use.

If your employer asks you to use your personal cell phone for business purposes without providing appropriate reimbursement, then you have the legal right to be compensated or reimbursed for that usage under California state law.

What Is Labor Code 2802?

California Labor Code 2802 requires employers to reimburse or fully compensate employees for all business expenses that they incur for doing their jobs. This includes reimbursing employees for business-related work on their cell phones. The purpose of the labor code is to protect employees from employers saving money by passing down costs to their employees. For example, employees must also be reimbursed if they use their own cars for business purposes.

It is important to understand that employers cannot require their employees to waive their right to expense reimbursement. If your employer asks you to waive your rights to reimbursement, you should speak with an attorney as soon as possible before you make a decision. If your employment contract has language indicating that you waive your rights to reimbursement, it is likely that the language is null and void.

Ways of Reimbursement

California law allows employers to decide how they want to reimburse their employees for expenses. This means that employers could reimburse employees directly or through higher wages or stipends.

However, it is important to note that if the employer elects to compensate employees with higher wages, then the employer must clearly distinguish between the employee’s regular wages and the wages that are for expense reimbursement.

Employers who do this are also required to have a clear expense policy in place that explains how reimbursement amounts are calculated. If you are terminated after seeking reimbursement for cell phone use, you could be able to file a wrongful termination claim.

Are Cell Phone Reimbursements Taxable?

Cell phone expense reimbursements could be subject to regular state and federal income tax. However, if the expenses are considered ordinary for the performance of the employee’s job, they may qualify for tax exemption. Consulting with an attorney or a tax professional could be a helpful way to have any of your tax-related questions answered.

FAQs

Q: Does California Require Cell Phone Reimbursement?

A: California state law requires employers to reimburse employees for any business-related use of their cell phones. This can be done through an increase in salary or a stipend rather than directly paying an expense reimbursement. Every company chooses its method of reimbursement.

California employers are free to create their own policies around cell phone expense reimbursement as long as they do not conflict with state and federal employment laws. It is not uncommon for some employers to provide business cell phones to their employees to avoid having to pay out reimbursements.

Q: What Is a Reasonable Cell Phone Reimbursement?

A: Reasonable cell phone reimbursement amounts can differ depending on the business model and nature of the cell phone use. It is common for some employers to pay out a flat rate for cell phone reimbursement, either as a stipend or an increase to their regular wages. The reimbursement amount is reasonable as long as it covers the business use of the cell phone.

Q: What Is the California Law for Reimbursement?

A: The California law for reimbursement, as defined under California Labor Code Section 2802, stipulates that California employers are required to provide reimbursement to employees for any and all necessary business-related expenses or losses that they incur.

The rationale behind this is to prevent employers from passing any of their costs or losses onto their employees. If the employer is asking or requiring their employees to do something that is a direct cost to them, then they may be reimbursed for it.

Q: Should My Employer Pay for My Cell Phone?

A: Your employer should pay for your cell phone bill if you are asked or required to use your cell phone for business related purposes. Your employer may reimburse you for cell phone use related to business but not personal use. California is one of the few states that has laws in place requiring employers to reimburse employees for business-related expenses. This can include cell phone bills for employees.

The bottom line is that your employer cannot ask you to take on personal expenses for company benefit without compensation.

Q: Does It Matter What Cell Phone Plan I Have for Cell Phone Reimbursement?

A: No, it does not matter what cell phone plan you have or whether you have a limited or unlimited plan for cell phone reimbursement. All that matters is the amount of time you spend on your cell phone for business purposes. For example, if roughly 30% of your screen time is spent answering client phone calls or responding to client emails on your cell phone, then you could expect your cell phone reimbursement amount to be about 30% of your bill.

Get the Legal Help You Need

Cell phone reimbursement law is a less common area of law that is specific only to a few states in the US. California is one of the few states that requires employers to reimburse their employees for business-related expenses, including cell phone bills.

This area of law can become complex, and it often requires the legal acumen of an attorney experienced in cell phone reimbursement claims. The legal team at the Shirazi Law Firm, PC, is ready and able to help answer any questions that may relate to cell phone reimbursements from your employer. If your employer requires you to use your personal cell phone for business purposes, you may be eligible for reimbursement.

If your employer refuses to provide reimbursement and you are not compensated for it in your pay, you should contact an attorney. Speak with a member of our legal team today for assistance.