Covered medical expenses. reimburse employees for expenses within 30 days after the employee submits Panel Discussion: Moving the 39-2-701. There is no federal requirement to provide reimbursement for remote expenses, except where those expenses would have the effect of lowering an employee's wages to below minimum wage,. Average Percentage of Workforce That Is Remote at Least Part Time. paper, CompAnalyst This guide will break down expense reimbursement laws by state. Also, in addition to the jurisdictions listed below, employers should be aware that other states require employers to reimburse employees expenses consistent with any written policies the employer may have. The employer may also require that advance approval by a manager or supervisor is required before employees incur certain types of expenses and/or those over a threshold dollar amount. Business Expense Reimbursement Policy Template Please log in as a SHRM member. As such, all employers who are requiring employees to work remotely should think about the types of expenses their remote employees are incurring and issue them a reasonable amount of expense reimbursement to cover those expenses. In some states, these requirements even extend to other utilities. Post-pandemic, the company will continue to provide home office equipment to anyone who is working remotely. Combined with a mileage calculator, data-driven insights, and automated approvals, you and your employees have everything you need to make strategic spending decisions. One of the key components of the most onerous expense reimbursement laws is the requirement to reimburse for any necessary expense, which begs many a question about what types of expenses must be reimbursed. While state law cannot be characterized as uniform across states, below are some key components to consider when revisiting any such obligation under these state laws. According to law firm BakerHostetler, expense reimbursement lawsuits were already commonplace before the pandemic, and with no end in sight to the pandemic and employees working from home, employers can expect additional lawsuits to be filed.. AppendixAddendum Work-Related Travel to Campus, Slides from 07/26/17 Business Expense Policy Session, Employee Gifts and Celebratory Events Policy, Moving, Recruiting, Visa and Related Expenses, Universitys Information Security and Privacy website, 1033 Massachusetts Ave., 3rd FloorCambridge, MA 02138Email:financialpolicy@harvard.edu Harvard's Digital Accessibility Policy, Effective 1/1/2018 as part of theTax Cuts and Jobs Act, all. Consequently, in addition to other pandemic-triggered adjustments, employers should review and update their remote work and expense reimbursement policies immediately. This approach will usually cover the vast majority of expenses but it should nevertheless be coupled with a process by which employees can seek reimbursement of additional expenses that were not covered by the stipend. Are your office employees getting treats like massage sessions at the office? While the question of necessity will turn on the specific job at issue, it is imperative that employers set clear expectations for what tools they require for an employees home office and what is not needed to do the job. Per diem plans are slightly more complex. 2330 Expenditures for Remote Work - University of Pennsylvania However, it appears that a court in Switzerland has ruled in favor of an employee arguing that the company should pay for a portion of their rent since they were required by the company to work out of their home. What states require reimbursement for remote work? A work-from-home reimbursement policy for network tech At Sentric, we help businesses make people management easier with industry-leading technology and standout support. Subscribe to our blog for the latest employment law news. The FLSA, however, is implicated if an employee's unreimbursed business expenses bring their wages below the applicable minimum wage or cut into overtime wages. The District of Columbias expense reimbursement law requires employers to pay the cost of purchasing and maintaining any tools the employer requires to perform the employers business. However, you shouldnt choose a number arbitrarily. It can also make your workforce more productive by allowing them to get the tools they need to perform better, like a second computer monitor. Here's what you need to know about managing expense reimbursement for remote workers. PDF Employee Remote Work Policy and Agreement But several states have additional requirements. Let us help you incorporate your business. PDF Addressing the impact of COVID-19 Remote Workforce Expenses - Deloitte US operate in this new environment almost overnight. If you arent ready to invest in software, make sure you have a clear expense policy. Non-accountable plans meet any of the following criteria: Reimbursements under non-accountable plans are considered wages and are taxed as a result. Consider your company budget and the maximum amount you can afford to reimburse employees for certain expenses. If a business is not concerned about the tax consequences or does not want the hassle of an accountable plan, it may implement an informal reimbursement policy. This general rule is going to apply most of the time because only about 20 percent of U.S. states have enacted laws that require employers to reimburse remote employees work expenses. Under an IRS accountable plan, an employer's reimbursement policy must satisfy three qualifications: A business may also deduct reimbursements under an accountable plan from its taxes as business expenses. What constitutes necessary expenditures is fact specific and varies based on the job type. Stay in-the-know with the latest industry news, resources, and topics. Business Expense Reimbursements Policy with Addendum 04/19/2023Addendum Work-Related Travel to Campus 04/19/2023FAQs Work-Related Travel to Campus05/01/2023Work-Related Travel to Campus Workflow05/01/2023HBS Users - See Accessing aHarvard University SharePoint Site or MS Teamif you are unable to view the documents. Before we get started on this topic, let me disclose that I am not a lawyer. When a primary workspace is the home rather than the office, the lines between what expenses an employer should reimburse can blur. But several states have additional requirements. Talk to managers to determine what employees need to be productive and engaged and develop a remote work reimbursement plan that: includes updated policies, is compliant with federal and state regulations, and considers what equipment your company will provide to remote employees. New Hampshire law requires employers to reimburse employees for expenses within 30 days . } 4th 1137 (2014)), a California court of appeal . You may also choose to provide reimbursement as a voluntary benefit. Suite 400 The survey showed: Employers will "need to continue to adapt to having a larger percentage of remote workers, and this will fundamentally change their culture," said Ravin Jesuthasan, managing director atWillis Towers Watson. With the remote work, many questions have emerged about reimbursable expenses for remote work. Manage Expense Reimbursement for Remote Workers | SentricHR on the circumstance. Add structure to flexible work arrangements by detailing expectations and responsibilities for employees. That means we may disclose unsolicited emails and attachments to third parties, and your unsolicited communications will not prevent any lawyer in our firm from representing a party and using the unsolicited communications against you. If you offer telework as a reasonable accommodation to a qualified individual with a disability, you cannot require them to pay for the associated remote work costs. Necessary cookies are absolutely essential for the website to function properly. Employees working from home may see their utilities bills rise because they are using more electricity and need to adjust their climate control systems to be comfortable. Copyright Rocket Lawyer Incorporated.Rocket Lawyer is an online legal technology company that makes the law simpler and more affordable for businesses, families and individuals. The Biden Administration Issued Its Spring 2023 Regulatory Agenda . var currentUrl = window.location.href.toLowerCase(); Issuing a standard, monthly flat reimbursement that reasonably covers expenses for phones and internet access fees. Remote Team Employee Expense Reimbursement Policy Template While employers expect to have significantly more remote workers in the future compared with last year, many have yet to develop policies to accommodate those working from home. They may look for ways to cut their costs. But if you have a written policy that offers reimbursements to employees, those reimbursements are considered fringe benefits or wage supplements. Depending on the claim, you need to pay them within 10 or 60 days (or as outlined in your policy). document.getElementById("sa-year-span").innerHTML = new Date().getFullYear() Salary.com. PDF Remote Work Reimbursement Policy Template Other employers have opted for full-time remote work for their employees. We use cookies on our website to give you the most relevant experience by remembering your preferences and repeat visits. What expenses should my employer pay if I work from home? 2021. Business Expense Reimbursements for Remote Workers By Jana Bjorklund, GovDocs Senior Counsel and Director, Employment Law and Compliance Published July 29, 2021 Ten jurisdictions at the state and local level have enacted laws requiring employers to reimburse employees for certain business expenses. Expense Reimbursements in the Era of Remote Working, DOLs Proposed FLSA Independent Contractor Rule: Investment as Indicative of Profit and Loss. These plans give employees a daily allowance for meals, transportation, and other expenses they might incur while traveling. 1305 Corporate Center Drive Our HR teams goal is to work to understand the needs of each teammate and recognize that, unlike an office, every home situation is different. Regardless of any requirement, set clear expectations upfront. In this case, its California. Iowa Code 91A.3 (6). Lawyer must be part of our nationwide network to receive discount. In most cases, a necessary expense is anything an employee needs to complete their job responsibilities. Those mandates remain securely in place. 2) Satisfy Harvards rules for reimbursements. While no policy can address every situation, this document is intended to cover the most common business expense scenarios; where unusual circumstances arise, the spirit of this policy along with good judgment must prevail. If an employee lives on the other side of the country, the shipping costs may not be worth the trouble. Though tedious, this approach is the only way to avoid paying taxes on the amount reimbursed, which will otherwise be considered supplemental income for an employee. But opting out of some of these cookies may have an effect on your browsing experience. The GovDocs software platform integrates three solutions in one convenient place to help you master the employment laws impacting your business. Is It Time for Employers to Reimburse Remote Workers' Expenses? (subscription required). Build specialized knowledge and expand your influence by earning a SHRM Specialty Credential. If the pandemic has caused a large proportion of your employees to work from home, review your current reimbursement policy and expand it to cover work from home situations. An Update on Remote Work Reimbursements | CDF Labor Law LLP It may be worthwhile to copy over that aspect of your remote work policy, if you have one. such reimbursements are considered fringe benefits or wage supplements and Employees do not need to submit expenses for approval or reimbursement within a reasonable amount of time. Reimbursing remote employees for similar treats (or giving them a monthly stipend) can help boost satisfaction and make them feel more connected to the rest of your company. Remote employees dont have access to these benefits or the community they facilitate. Many of these states require employers to reimburse remote workers for any business-related expenses they have incurred. Creating a business expense policy can help you stay compliant and consistent when reimbursing remote employees. employee submits an expense claim, except expenses normally borne by the Update Your Reimbursement Policy to Include Expenses for Remote Workers Business Expense Reimbursements for Remote Workers Generally Allowable Purchases Penn will supply employees the appropriate tools to do their jobs. Whether you manage a postings, minimum wage or paid leave program, our products cut through research time, provide proactive insights into the everchanging landscape of employment laws and reduce the risk of noncompliance. Seyfarth Synopsis: The COVID-19 pandemic thrust remote working upon many employers without notice or adequate time to prepare. However, this arrangement leaves remote workers to cover the cost of their own electricity, internet, and office supplies. What are the federal requirements for remote work reimbursements. All the legal documents you needcustomize, share, print & more, Unlimited electronic signatures withRocketSign, Ask a lawyer questions or have them review your document, Dispute protection on all your contracts withDocument Defense, 30-minute phone call with a lawyer about any new issue, Discounts! Are expense reimbursements tax deductible? Unsubstantiated expenses In most instances, a business does not have to reimburse expenses for which the remote worker cannot provide adequate documentation unless the policy does not require such documentation. Remote Employee Reimbursement Rules by State - Paycor Some employers require remote workers to substantiate all reimbursable expenses with documentation, usually a receipt. Business Expense Reimbursement Policy Template. 1. Search and download FREE white papers from industry experts. No matter where your employees work, some best practices can help you navigate remote expense reimbursement. In light of a changing work environment and heightened expectations to be able to work remotely, take a serious look at your reimbursement policy. Seattle defines compensation to include any business expenses incurred by employees. An expense reimbursement policy is used in a business to repay employees for any out-of-pocket expenses that they have incurred on behalf of their employer. If your policy states that youll reimburse certain expenses, you need to comply with your own rules. document.getElementById("sa-year-span-mobile").innerHTML = new Date().getFullYear() Salary.com. Transform compensation at your organization and get pay right see how with a personalized demo. Ann. a job, you need data from a range of On a federal level, under the Fair Labor Standards Act (FLSA), employees cannot be required to directly pay or reimburse their employer for business-related expenses if doing so would cause the employees wage rate to fall below the required minimum wage or overtime compensation thresholds. No spam, just HR & Payroll updates delivered right to your inbox once a month. The laws and compliance surrounding remote employee reimbursement can be challenging to navigate. tit. If you have remote employees in multiple states, check the laws in each location to ensure you stay compliant. Survey on Employer Response to COVID-19 by XpertHR, a provider of HR information resources, was conducted from late July to mid-August 2020, with responses from 835 U.S. employers that together employmore than 1 million workers. Create a remote work or telecommuting policy that clearly outlines what equipment is provided and what the reimbursement rate for other necessary expenditures will be. The company provides all IT equipment including laptops, PCs, headphones and video cameras. Employees should seek approval in advance of incurring any expenses.