Cautionary Reminder: employers must reimburse employees for work-related use of personal mobile devices

Published on


In the course of assisting employers with compliance-related matters, we frequently encounter issues of concern where employers require or expect employees to use their personal mobile devices for work-related matters. In the customer service-intensive environment of a car dealership, employees are expected to be readily available to customers, and it is the norm for salespersons and service advisors to provide customers with their personal cell phone numbers for ready access. However, where the employee is required or expected to use his/her personal device to perform work duties, the employer is obligated under California law to reimburse the employee for any costs associated with such use. This requirement is derived from California Labor Code Section 2802, which states that “[a]n employer shall indemnify his or her employee for all necessary expenditures or losses incurred by the employee in direct consequence of the discharge of his or her duties, or of his or her obedience to the directions of the employer…”

In 2014, the California Court of Appeal in Cochran v. Schwan’s Home Services Inc., ruled that even where an employee does not incur any additional expense in using a personal mobile device for work (such as where the employee has an unlimited use plan or other flat-fee plan) the employer must still pay for a reasonable percentage of the employee’s mobile device bill. It is not entirely clear what a “reasonable percentage” is, although it should be sufficient for the employer to pay a percentage of the bill that corresponds with the percentage of work use allocated for the device. For ease of administration, some employers reimburse employees with a flat amount per month that is contemplated to sufficiently cover the amount of work use for the device. However, if the employee can show that the proportionate cost for work use exceeds the flat reimbursement amount, the employer must supplement the reimbursement to that extent. In order to avoid this reimbursement issue altogether, some employers opt to supply the employees with company-issued devices.

It is important for employers who require or expect employees to use their personal mobile devices for work to evaluate their expense reimbursement policies to ensure that they are providing sufficient reimbursement and properly documenting such practices.