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Amid Public Health Crisis, Employers May Need To Reimburse Telecommuting Employees

In an effort to slow the spread of COVID-19, many employees are working remotely. While telecommuting during this crisis can be beneficial for public health, it also presents unique challenges for employers, such as ensuring compliance with applicable expense reimbursement laws. During this time, the employer may need to reimburse the employee for any additional phone, internet, or other expenses incurred.

The United States Department of Labor (“DOL”) recently highlighted the issue as part of their “COVID-19 and the Fair Labor Standards Act (FLSA) Questions and Answers” website. More specifically, in addressing whether “businesses and other employers [are] required to cover any additional costs that employees may incur if they work from home (internet access, computer, additional phone line, increased use of electricity, etc.),” the DOL reiterated that “employers may not require employees who are covered by the FLSA to pay or reimburse the employer for such items that are business expenses of the employer if doing so reduces the employee’s earnings below the required minimum wage or overtime compensation.”

Additionally, employers should determine any additional requirements imposed by applicable state law. In California, Labor Code Section 2802 requires employers to reimburse employees for all “necessary expenditures or losses” the employees incur in carrying out their job duties. As a result, it has been recommended that it may be helpful to develop a telecommuting pandemic policy to provide clear instruction on this issue.