Gas Mileage Reimbursement - California
Sheila2008
44 Posts
Is the new rate mandatory for employers to pay 58.5 per mile?
I read this, but then thought it may be what they can use as a deduction at the end of the year. Also, I noticed the word optional.
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Comments
From everything I am finding, the DLSE is of the opinion that the IRS's standard mileage rate satisfies the expenses incurred by employee reimbursement requirement. Here's one document that discusses the 1937 law and how it has been interpretted: www.dir.ca.gov/dlse/2802Regs/2802Regs-ISOR.doc
From: www.laboremploymentlawblog.com/expense-reimbursement-107-irs-mileage-rate-increased-to-485-cents.html -- while this is a bit old (2006), it makes a really good point: "....In cases where there is no agreement for reasonable reimbursement for business-related mileage (i.e. the IRS rate), the DLSE requires the employer to reimburse the employee for the actual costs incurred in operating the vehicle for business purposes. Such costs include losses due to accident or theft while the employee's personal vehicle is being used for business. Thus, a prudent course of action under California law is to reimburse employees at the IRS rate for all mileage incurred in using an employee's personal vehicle for business purposes...."
And one last link for a 2008 article: "California's DLSE has maintained that employers are required to reimburse employees for business miles driven at the IRS mileage rate in order to comply with California Labor Code section 2802. However, just last year, the California Supreme Court ruled in Gattuso v. Harte-Hanks ....that the reimbursement rate does not have the be the IRS mileage rate but can be negotiated by parties as long as it fully reimburses the employee. The Court stated:
So if employers wish to reimburse employees at an amount lower than the IRS mileage rate, it is recommended that the agreement be documented and that the employer take into account any facts that would either increase or decrease the amount needed to fully reimburse the employee. " from http://www.vtzlawblog.com/2008/06/articles/wage-and-hour-issues/irs-mileage-rate-to-increase-8-cents-july-1-2008/
I just posted a message with some applicable links for you (it takes a little time for posts with links to be approved), but wanted to make sure that you and other readers realized the information I posted was for California only. Most states don't require reimbursements at all.
For some reason the message with the links has not been approved yet. I will say that California REQUIRES an employer to reimburse for employee expenses. If you go less than the IRS rate, the employer takes on more liability for what is owed should there be an accident or other risk of the employee using a personal car for company business.
The IRS is not looking at state wage laws at all. Their answer is correct from their viewpoint. The IRS does not require employers reimburse employees for business expenses. But it is incorrect from a California wage law viewpoint. What you need to read through is :
Title 8. California Code of Regulations
Division 1. Department of Industrial Relations
Chapter 6. Division of Labor Standards Enforcement
Subchapter 12. Travel Expense Reimbursements
Sections 13700 through 13706
I would also suggest using the following search at Google " California DLSE expense reimbursement littler" to get to a really good article by the Littler law firm about reimbursing expenses in CA. It should come up as the first link listed.