California, United States · employment

Does My Employer Have to Reimburse Me for Working from Home in California?

Under California law, employers are required to reimburse remote workers for necessary job-related expenses, including home internet and personal phone usage. Companies cannot evade this obligation by claiming you already have an unlimited data plan or signed an agreement waiving your rights. If your employer shifts their operational costs onto your household budget, California Labor Code Section 2802 gives you the right to recover those funds with interest and legal fees.

What the Law Says in California

In California, remote work expense reimbursement is not a discretionary workplace perk; it is a statutory mandate. Under California Labor Code Section 2802, an employer must indemnify an employee for all necessary expenditures or losses incurred in direct consequence of the discharge of their duties. Furthermore, under Labor Code Section 2804, any contract or agreement waiving your right to expense reimbursement is null and void. Your employer cannot make you sign away these rights in an offer letter or remote work agreement.

California appellate courts have consistently enforced this protection for remote employees. In Cochran v. Schwan's Home Service, Inc. (2014), the court established that an employer must pay a reasonable percentage of an employee's cell phone bill whenever personal phone use is required for work. Critically, this applies even if the employee has an unlimited data or voice plan and incurs no extra out-of-pocket costs. In Thai v. International Business Machines Corp. (2023), the court confirmed that this principle applies to home internet and equipment required to carry out assigned duties. If the company requires you to perform work from home, it cannot shift the overhead costs of doing business onto you.

Qualifying Expenses and Stipend Rules

Qualifying remote expenses typically include a reasonable percentage of your home internet service, business use of your personal mobile device, necessary hardware (monitors, keyboards, headsets), and essential office supplies. While employers do not have to pay for luxury upgrades or purely personal equipment, they must cover whatever tools are reasonably necessary to execute your duties.

Under the California Supreme Court precedent Gattuso v. Harte-Hanks Shoppers, Inc. (2007), employers may satisfy Section 2802 through actual expense reimbursement or by paying a regular lump-sum stipend. However, if an employer chooses a flat stipend, the amount must be clearly itemized on your wage statement and must realistically cover the actual costs incurred. If the flat stipend falls short of your actual business-related expenses, the employer remains liable for the difference.

How to Demand Payment and Enforce Your Rights

Employers frequently take advantage of remote staff by relying on informal policies or silence, leaving employees to absorb monthly utility and telecommunications bills. When companies fail to reimburse necessary expenses, the law entitles employees to recover the principal amount owed, statutory interest calculated from the date each expense was incurred, and reasonable attorney's fees.

If informal requests to your manager or HR department are ignored, you can document your usage, calculate the business share of your bills, and submit a formal written demand. You can use Caunsel to research your statutory rights, store and organize your utility invoices inside an active case record, or connect with an independent California employment lawyer to assess a formal reimbursement claim.

Steps

• Pull your monthly internet and cell phone statements covering your entire remote work tenure.
• Calculate the reasonable work-related percentage for each utility based on your regular work schedule and daily usage.
• Collect all purchase receipts for mandatory home office hardware, computer peripherals, cables, and software.
• Review your pay stubs to confirm whether any separate, designated expense stipend has been paid.
• Draft and submit an itemized written reimbursement request directly to HR or payroll citing California Labor Code Section 2802.

Common mistakes

• Assuming an unlimited phone or internet plan eliminates your employer's duty to pay a reasonable share.
• Signing an employee handbook or remote agreement that attempts to waive your reimbursement rights.
• Discarding past telecommunications and internet invoices before calculating back-owed expenses.
• Relying on verbal agreements with your manager instead of submitting written, itemized reimbursement requests.

Questions people ask

What if my employer claims remote work was entirely voluntary?

If your employer gives you the genuine option to work in a fully equipped company office but you freely choose to work from home, courts may find the home expenses were not strictly necessary. However, if working in the office was impractical, discouraged, or unavailable, your home expenses remain legally compensable under California Labor Code Section 2802.

How is a 'reasonable percentage' of an internet or phone bill calculated?

California law does not prescribe a rigid percentage, but courts look at actual business use compared to personal use. For example, if you work 40 hours per week and rely on broadband during those hours, allocating a reasonable daytime proportion (often 30% to 50% of the base utility cost) is a common standard.

Can my employer claim my regular salary covers my remote work expenses?

Only if your employer explicitly agreed in writing to pay an enhanced salary specifically apportioned to cover expenses, and the amount designated is sufficient to fully cover the actual expenditures. An employer cannot retroactively claim that an ordinary base salary was meant to cover your home bills.

General information only, last updated 2026-10-11. Caunsel is not a law firm and does not practise law. AI answers and this guide are not legal advice. Verify filings, deadlines, and statutes with a licensed lawyer in California, United States.