Remote Employees and Expense Reimbursements
When it comes to expense reimbursements for remote employees, one of the best ways to stay out of hot water is to start with the question, “How would I want to be treated in this situation?” If you want to get more technical and legal, ask yourself: what expenses are directly necessary for my remote employees to do their job?
I need my laptop, internet, a nice chair, and coffee. Is there a state or federal law requiring my employer to provide me with coffee and an ergonomic chair? Not to my knowledge. But you’re probably better off getting your remote employee set up with a comfortable chair and sending an occasional bag of coffee beans. These things can go a long way in encouraging a positive remote work culture.
On the legal side, you’ll have to look closely at state and federal law to determine expense reimbursement obligations. Regardless of state, you should never expect your remote employees to pay for things like laptops, printers, paper, scanners, and ink. It will destroy your work culture even if you could make a legal argument for it.
In some states, attorneys argue that remote employees are entitled to partial expense reimbursements for almost everything, including utilities and internet. So look carefully at this issue, especially if you have employees in more employee-friendly states. You don’t want any surprises.
You should also consider whether you owe travel expense reimbursements when you require a remote employee to attend an in-person event. This can get you in trouble with your low-earning remote employees. Let’s say you have an employee who works forty hours per week in Florida and earns the state minimum wage of $11.00 an hour (in 2022). But let’s say you fail to reimburse $40.00 in fuel expenses. That employee could argue she earned $10.00 per hour rather than the state minimum wage of $11.00 per hour. That’s the kind of thing that can get the attention of wage and hour investigators and result in an audit with significant fines and penalties.
So carefully analyze state expense reimbursement laws, especially for low-income remote employees. Remember that even without a state law mandating reimbursement for some expenses, failing to reimburse could trigger wage and hour liability for your lower-income earners. Don’t nickel and dime your employees when it comes to company expenses.
