In the wake of the COVID-19 pandemic, more people have been working from home than ever before. For some employees, working remotely was a temporary change. However, for other employees, working from home has become a permanent arrangement. This leaves many employees wondering what work-from-home expenses they are responsible for and which ones their employers should cover.
While working remotely has advantages for employees, like eliminating time-consuming, stressful commutes, it has also given employers an opportunity to save money. For example, with a reduced in-office workforce, many employers have been able to downsize their office space.
This article will explore what remote work expenses should be covered by your employer and which home expenses you are responsible for. If you find that you’re covering expenses that should be paid for by your employer, contact We Stop Wage Theft to speak to an employment lawyer who can explain your rights.
Federal Law Regarding Work-From-Home Expenses
While there is no blanket federal legislation that addresses the issue directly, the Fair Labor Standards Act (FLSA) requires employers to reimburse employees for any work-from-home expenses that would cause their wages to fall below the federal minimum wage of $7.25 an hour.
Therefore, if you make just above minimum wage and your remote job requires you to use your own cell phone and internet service, then it’s possible your employer needs to reimburse you for those remote work expenses. But what if you are a salaried employee?
Do Exempt Employees Have to Pay for Work-From-Home Expenses?
The FLSA specifies that if remote work expenses cause an exempt employee’s earnings to fall below the salary threshold of $684 per week, then they must also be reimbursed. That’s why remote employees need to track their work-from-home expenses—they may be missing out on reimbursement if their wages or salary fall beneath the thresholds outlined by the FLSA.
State Laws Regulating Remote Work Expenses
State law is much clearer regarding remote work expenses, though what counts as a reimbursable expense varies from state to state. There are ten states that have clear statutes on reimbursing remote employees for business expenses.
Some states have laws requiring employers to reimburse workers for a variety of work-from-home expenses. States with such laws include California, Washington D.C., Illinois, Massachusetts, Iowa, Minnesota, Montana, New Hampshire, and New York.
State
What Does the Law Say?
Applicable Law
California
“all necessary expenditures or losses incurred by the employee in direct consequence of the discharge of his or her duties.”
Labor Code Section 2802
Washington D.C.
“the cost of purchasing and maintaining any tools required of the employee in the performance of the business of the employer.”
D.C. Mun. Regs. tit. 7 § 910
Illinois
“all necessary expenditures or losses incurred by the employee within the employee’s scope of employment and directly related to services performed for the employer.”
Wage Payment and Collection Act
Massachusetts
“Employers should reimburse expenses that are “unavoidable and necessary” for employees to fulfill their job responsibilities, according to guidance by the Massachusetts Attorney General’s office.”
Massachusetts General Law Chapter 149, § 148A
Iowa
“Expenses by the employee which are authorized by the employer and incurred by the employee shall either be reimbursed in advance of expenditure or be reimbursed not later than thirty days after the employee’s submission of an expense claim.”
91A.3(6) Mode of payment
Minnesota
“(2) purchased or rented equipment used in employment, except tools of a trade, a motor vehicle, or any other equipment which may be used outside the employment; (3) consumable supplies required in the course of that employment”
Minnesota Statute 177.24(4)-(5)
Montana
“(1) An employer must indemnify his employee, except as prescribed in subsection (2) of this section, for all that he necessarily expends or loses in direct consequence of the discharge of his duties as such or of his obedience to the directions of the employer”
Montana Code 39-2-701
New Hampshire
“An employee who incurs expenses in connection with his or her employment and at the request of the employer, except those expenses normally borne by the employee as a precondition of employment, which are not paid for by wages, cash advance, or other means from the employer, shall be reimbursed for the payment of the expenses within 30 days of the presentation by the employee of proof of payment.”
New Hampshire Revised Statutes 275:57
New York
“…any employer who is party to an agreement to pay or provide benefits or wage supplements to employees or to a third party or fund for the benefit of employees and who fails, neglects or refuses to pay the amount or amounts necessary to provide such benefits or furnish such supplements within thirty days after such payments are required to be made, shall be guilty of a misdemeanor”
New York Labor Law 198-C
What Is a Necessary or Required Expense?
Navigating through the legalese regarding remote work expenses is a challenging task. Many of the statutes talk about “expenses” and “expenditures,” but fail to specify what these actually are. That’s why it’s essential to define what a necessary or required work-from-home expense actually is.
If the expense is necessary for an employee to perform their duties then it can be considered a necessary expense. Having a desk, a computer, and a reliable internet service are necessary expenses for most occupations. However, extraneous expenses are not reimbursable—like an automated standing desk.
What Remote Work Expenses Should Your Employer Be Paying For?
As mentioned above, not every expense is going to be covered by your employer, but there are several work-from-home expenses that are often reimbursed by employers. Such expenses include:
- High-speed internet service
- Mobile phone service
- Landline phone service
- Computer accessories—scanners, printers, and webcams
- Laptop computers
- Computer monitors
- Tablets
- Data storage
- Postage costs
- Work-related travel
- Work-related lodging
Do Employers Have to Pay for Employee Cell Phones or Internet?
As mentioned above, there isn’t broad federal legislation regulating what work-from-home expenses—like work-related cell phone use—an employee must cover. Certain states have very specific laws outlining which work-related expenses employers must pay for and which work-from-home expenses are left to the employee.
Employers can also devise their own cell phone reimbursement policies so long as they do not violate state statutes or the FLSA.
Do Employers Have to Pay for Industry-Specific Software for Remote Employees?
In order to carry out your duties as an employee, you’ll likely need industry-specific software—Photoshop, Microsoft Office, Salesforce, or other workplace software. Your employer should cover these costs because they are necessary for you to carry out your duties as an employee. This is likely the case even if you use your own computer or laptop.
Check If Your Company Has a Remote Employee Reimbursement Policy
Some businesses are taking the lead on this issue and developing remote employee reimbursement policies that clearly delineate which expenses are fully covered or partially reimbursable. Your employer may have an outline of which remote work expenses are reimbursable and which ones aren’t.
Contact We Stop Wage Theft if You Haven’t Been Reimbursed By Your Employer
If you think your employer should reimburse you for work-from-home expenses you incurred on the job, contact We Stop Wage Theft today. You can reach us through our online contact form or over the phone at 844-696-7492 (toll-free).