Fact Check: Expense Reimbursement Laws by State (2026)

The FLSA has no general affirmative expense-reimbursement statute; the federal protection is the minimum-wage kickback rule

29 CFR §531.35 requires wages paid "finally and unconditionally" or "free and clear"; tool-of-trade costs that cut into minimum or overtime wages violate the Act

29 CFR §531.32 addresses employer-benefit items that are not wage-crediting "facilities"

Labor Code §2802(a) requires employers to indemnify employees for all necessary expenditures or losses incurred in direct consequence of duties or obedience to directions

§2802(b) awards carry interest from the date the employee incurred the expenditure; civil judgment rate is 10% under CCP §685.010

§2802(c) includes attorney's fees as necessary expenditures for enforcing the section

Statutory §2802 limitations period is 3 years under CCP §338(a); UCL repackaging can extend lookback to 4 years under Bus. & Prof. Code §17208

820 ILCS 115/9.5 requires reimbursement of all necessary expenditures or losses within the employee's scope of employment and directly related to services performed for the employer; effective January 1, 2019

Illinois statute defines necessary expenditures, requires 30-day submission (unless written policy longer), allows signed statements for missing receipts, permits reasonable written guidelines that are not de minimis, and excludes employee negligence / normal wear / non-employer-negligence theft

IWPCA enforcement / fee path runs through 820 ILCS 115/14

Montana MCA §39-2-701, North Dakota NDCC §34-02-01, and South Dakota SDCL §60-2-1 require employer indemnification for what the employee necessarily expends or loses in direct consequence of duties (Field Code lineage)

New Hampshire RSA 275:57 requires reimbursement within 30 days of proof for employer-requested employment expenses (except preconditions of employment); willful violation penalty up to $1,000 per violation

Massachusetts 454 CMR 27.04(4) requires reimbursement of associated transportation expenses for off-site reporting and mid-day directed travel

Massachusetts Wage Act MGL c.149 §§148 and 150 provide enforcement path with treble damages / fees exposure for related wage claims

Iowa Code §91A.3(6) requires authorized expenses reimbursed in advance or within 30 days of claim submission, with written justification for refusals

Minnesota Stat. §177.24 limits uniform/equipment deductions and requires certain refunds at termination rather than creating broad necessary-expenditure reimbursement

NY Labor Law §198-c treats agreed expense reimbursements as benefits or wage supplements enforceable when promised; not a free-standing duty without agreement

Pennsylvania WPCL can enforce promised fringe-benefit reimbursements; no general free-standing expense statute

D.C. 7 DCMR §910 requires employer payment for required tools; §908 covers required uniforms / protective clothing

Seattle SMC 14.20 treats reimbursable expenses as compensation owed under the wage-theft ordinance; SMC 14.34 adds independent-contractor expense disclosure rules

Federal minimum wage is $7.25/hr

2026 IRS mileage rates are effective-dated: January–June business 72.5¢ and medical/moving 20.5¢; July–December business 76¢ and medical/moving 23.5¢; charitable 14¢ all year

DOL opinion letter FLSA2008-15 (Sept. 11, 2008) accepts a reasonable approximation of vehicle expense, often the IRS rate, for kickback-rule purposes

Gattuso v. Harte-Hanks Shoppers, Inc., 42 Cal. 4th 554 (2007), allows actual-expense, rate, or lump-sum reimbursement methods, with lump-sum requiring identification and adequacy proof

Cochran v. Schwan's Home Service, Inc., 228 Cal. App. 4th 1137 (2014), requires reimbursement of a reasonable percentage of a personal cell-phone bill when use is required for work, regardless of unlimited plan or marginal cost

Thai v. International Business Machines Corp., 93 Cal. App. 5th 364 (2023), rejected the defense that a government stay-home order (not the employer) caused remote-work expenses under §2802

Townley v. BJ's Restaurants, Inc., No. C086672 (Cal. Ct. App. 2019), held that ordinary slip-resistant occupational shoes that are usual and generally usable in the restaurant occupation are not reimbursable necessary expenditures under §2802 merely because the employer required them

Secondary marketing lists saying "11 states" often collapse conditional / agreement-based regimes into one bucket; this table separates them

IRS mileage rate is a tax safe harbor / optional substantiation method, not a federal reimbursement mandate

Reimbursement duty generally follows employee work location rather than employer headquarters

51-row table covers 50 states + DC with duty values Yes—broad / Yes—narrow / Conditional / No

IRC §67(g) suspension of miscellaneous itemized deductions for unreimbursed employee expenses was made permanent by the 2025 One Big Beautiful Bill Act

Named statutes, cases, IRS notices, and DOL materials carry inline links at first meaningful mention; Sources section lists URLs by category