California Labor Code Section 2802 requires your employer to reimburse you for every necessary expense you incur doing your job or following their instructions.1California Legislative Information. California Labor Code LAB 2802 That covers mileage, cell phone bills, home internet for remote work, tools, uniforms, travel costs, and anything else that was a direct result of the work. If your employer refuses, you can recover the money, plus interest running from the day you spent it and the attorney’s fees it takes to collect.
The Core Duty, and Why It Can’t Be Waived
The statute is written broadly on purpose. An employer must repay all necessary costs you incur as a direct consequence of performing your duties, and the duty applies even when the employer’s instructions turn out to be unlawful, unless you knew at the time that they were illegal. Pre-approval under a company policy is not the test. The test is whether the expense was necessary for the job.
Section 2804 locks the right in place. Any contract, handbook acknowledgment, or arbitration clause that tries to waive or limit reimbursement rights is void.2California Legislative Information. California Labor Code LAB 2804 It doesn’t matter what you signed when you were hired.
What Counts as a Necessary Expense
Mileage and Vehicle Use
Driving your personal car for work is reimbursable. Many employers use the IRS standard business mileage rate, which is 72.5 cents per mile for 2026.3Internal Revenue Service. IRS Sets 2026 Business Standard Mileage Rate at 72.5 Cents Per Mile, Up 2.5 Cents The IRS rate isn’t required, though. In Gattuso v. Harte-Hanks Shoppers, the California Supreme Court held that employers can reimburse through enhanced base pay, higher commissions, or lump-sum payments, as long as the amount actually covers your real costs and the reimbursement portion is clearly distinguishable from wages.4Justia Law. Gattuso v. Harte-Hanks Shoppers, Inc. Whatever method is used, it has to make you whole.
Cell Phone and Home Internet
If your employer requires you to use your personal cell phone for work, they owe you a reasonable percentage of the bill. The Court of Appeal held in Cochran v. Schwan’s Home Service that this is true even if you have an unlimited plan, because unlimited isn’t free.5Justia Law. Cochran v. Schwans Home Service The same reasoning applies to home internet when you use it for work, which matters for remote and hybrid employees. You and your employer need to settle on a reasonable split between work and personal use.
Tools, Equipment, and Remote-Work Supplies
If the employer requires specific tools, uniforms, safety gear, or office equipment and doesn’t supply them, the cost is theirs. For remote workers, that can extend to a desk, headset, printer, or routine office supplies needed to do the job from home.
Business Travel
Lodging and meals during required work travel qualify as necessary expenses. Some employers benchmark their travel reimbursements to the General Services Administration’s per diem rates, which set location-specific daily allowances for lodging and meals.6General Services Administration. Per Diem Rates Section 2802 doesn’t require GSA rates, but they’re a widely accepted reference for what counts as reasonable.
Keep Records That Will Hold Up
Good documentation is what separates a routine reimbursement from a dispute. Save receipts, invoices, and any emails that show what you spent, when, and why. For mileage, keep a running log with the date, destination, business purpose, and distance for each trip.
Mixed-use expenses like your cell phone or home internet need a reasonable work-versus-personal allocation. Estimate the percentage you use for work each month and apply it to the bill. You don’t need minute-by-minute precision, but you should be able to explain how you arrived at the number. Submit requests through whatever process your employer has. If there is no formal process, put the request in writing anyway. A paper trail protects you if the dispute later ends up in front of the Labor Commissioner.
You Have Three Years, Expense by Expense
Section 2802 claims are governed by the three-year statute of limitations for statutory liability under Code of Civil Procedure Section 338.7California Legislative Information. California Code of Civil Procedure CCP 338 The clock runs from the date each individual expense was incurred, not from the end of your employment. If you’ve been absorbing costs for years, the oldest ones may already be time-barred while more recent ones are still recoverable. That’s a reason to track expenses as they happen and raise the issue sooner rather than later.
Three Ways to Recover What You’re Owed
File a Wage Claim With the Labor Commissioner
The most accessible route is a wage claim with the Division of Labor Standards Enforcement, filed online.8Division of Labor Standards Enforcement. How to File a Wage Claim The DLSE investigates and, if it finds the employer owes you, issues an order against the employer. You don’t need a lawyer, which makes this path practical for smaller amounts.
File a Civil Lawsuit
You can also skip the agency and sue directly in court. That tends to make sense when the amount is substantial, when multiple employees have the same complaint, or when you want the broader discovery a lawsuit allows.
Labor Commissioner Citations
Section 2802 also lets the Labor Commissioner issue citations directly against employers that fail to reimburse. Amounts recovered through citations go to the affected workers, not the state.
What You Can Collect
Recovery under Section 2802 goes beyond the raw dollar amount of the expenses.
Interest accrues on each unreimbursed expense from the date you spent the money, not from the date of any later judgment.1California Legislative Information. California Labor Code LAB 2802 The rate matches the civil judgment rate, generally ten percent per year.9California Legislative Information. California Code of Civil Procedure CCP 685-010 – Rate of Interest on Money Judgment On a claim that has been building for a couple of years, that compounds into a meaningful number.
Section 2802 also defines “necessary expenditures or losses” to include reasonable attorney’s fees and costs incurred enforcing the statute. This fee-shifting is what makes smaller claims viable. An employment lawyer can take the case knowing the employer pays the legal bill if you win.
Why This Matters More Than It Used To
Before 2018, employees who absorbed work expenses could at least partially offset them with a miscellaneous itemized deduction on their federal return. The Tax Cuts and Jobs Act suspended that deduction, and later legislation made the suspension permanent.10Office of the Law Revision Counsel. 26 USC 67 – 2-Percent Floor on Miscellaneous Itemized Deductions A narrow group, such as educators with qualifying classroom expenses, still has a version of it; most employees do not. For California workers, Section 2802 is now the only real protection against paying business costs out of your own pocket.
The Federal Minimum-Wage Backstop
Federal law provides a much narrower floor through the “kickback rule.” Employers must pay wages free and clear, meaning they can’t require an employee to absorb business expenses that would effectively push pay below the federal minimum wage or cut into required overtime.11eCFR. 29 CFR 531.35 – Payment in Cash or Its Equivalent For employees earning well above minimum wage, this rarely matters in practice. Section 2802 is far broader: it covers all necessary expenses in California regardless of what you earn.