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Meal Allowance or Expense Reimbursement California

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  • Meal Allowance or Expense Reimbursement California

    We employ technicians that often travel 2-3 hours or more to work on customer sites. If the job will take more than 12 hours to complete, we require the technician to stay overnight so there is no travel back and forth (we do pay all travel back and forth and provide transportation). We also pay for the motel room. For meals, we provide a $25 per night reimbursement to the employee. The employee is not required to provide reciepts. Are we violating any wage/hour laws? Is there a 'minimum' we are required to pay for meals? I'm not sure I could eat HEALTHY meals (breakfast, lunch and dinner) on $25 a day and feel we may be forcing our employees to eat junk food. Thanks.

  • #2
    I can give you a "soft" answer. CLC 2802 requires reimbursement of all business expenses incurred by employees. CA is the only state with such a general rule. (MA has a limited rule for mileage).

    HOWEVER, there is a lot of "iffy" guidance issued by CA-DLSE on this subject. I have not seen a hard answer applicable to your specific facts, but I can see some general guidance that sort of supports your position. Look at section 29.2.
    http://www.dir.ca.gov/dlse/Manual-Instructions.htm

    2nd HOWEVER. Let's flip the issue and pretend that you are the employee trying to fight this rule. I know what argument I would use (as the employee). I am not saying that the argument would work, because I have not seen CA-DLSE respond to the argument, but there is a decent chance it would. The argument would go like this.
    - The reimbursement is inadequate for the specific trips involved (cannot be a general argument).
    - The employer needs to reimburse either actual expense or a "reasonable" estimate. I would argue that "reasonable" is the IRS Per Diem rates (Pub 1542).
    - While I cannot find a specific example (pro or con) of CA-DLSE discussing the IRS Per Diem in a meal context, CA-DLSE does use the similar safe harbor method of IRS mileage rates in that context.
    - The IRS Per Diem method is a well recognized method with plenty of legal support. The $25/day is some number my employer pulled out of the air.

    I am not saying that the $25/day will not work. CA-DLSE may indeed like it. But speaking as someone who works Accounts Payable as well as Payroll, if you have someone away from home, $25/day is a very low ball number. The IRS Per Diem is considered low ball by many, but it is much higher then what you are quoting. Also, if the employee is away from home (a legal phrase), in CA they can also claim breakfast, lunch and maybe incidentals.
    "Reality is that which, when you stop believing in it, doesn't go away".
    Philip K. **** (1928-1982)

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