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California law requires employers to reimburse employees for business expenses the employees must cover, and this includes mileage reimbursement. While your employer does not have to cover the costs of your daily commute or unnecessary vehicle-related expenses, it does have to reimburse you if you use your personal vehicle for business purposes and for the benefit of the employer. 

Failing to properly reimburse you constitutes unpaid wages in California, and anyone who suspects their employer failed to fully reimburse them should speak with a California employment lawyer right away. 

How Reimbursement Works

If an employee uses a car they personally own for work, reimbursement should cover the costs of:

  1. Fuel
  2. Wear and tear causing vehicle depreciation
  3. Repairs and maintenance
  4. Auto insurance
  5. Vehicle registration costs

Employers can determine how to calculate and provide the reimbursement, including:

  1. Paying based on actual mileage traveled for work
  2. Paying based on actual expenses and receipts
  3. Using a combination of fixed rates, such as for insurance premiums, or variable rates for fuel expenses
  4. Lump-sum payments as gas and expense “stipends”

Employers can choose any of these methods as long as they are fully reimbursing the employee.

The IRS Mileage Reimbursement Rate for 2022

The Internal Revenue Service (IRS) sets optional standard mileage reimbursement rates and adjusts them each year based on inflation and other factors. As of January 1, 2022, the mileage reimbursement rate was increased to $0.585 per mile if an employee uses a personal car, SUV, pickup truck, van, or panel truck for work purposes.

If a personal vehicle is used for work for charitable organizations, the rate drops to $0.14 per mile. For active-duty members of the U.S. Armed Forces or travel for moving or medical purposes, the rate is $0.18.

Employers do not have to use these standard mileage reimbursement rates. The IRS bases its rates on a national average, so the costs of personal vehicle use in California are often much higher. The IRS rate should not be the only factor considered when California employers are reimbursing employees.

What if I Think I Did Not Receive Enough Reimbursement?

Many employers underpay employees for mileage and other vehicle costs. If you think you are not receiving proper reimbursement for your mileage and other vehicle-related expenses, you should discuss the matter with an unpaid wage attorney in California. A lawyer will understand your rights under state law, and we can review all of your expenses and advise whether you were underpaid.

If so, we can assist you in taking steps to seek the unpaid wages you deserve by filing a wage and hour claim. Your employer’s reimbursement policies might be violating the rights of many employees who use their vehicles for work. In this situation, you might all be able to file a class action to seek your unpaid wages.

Contact a California Unpaid Wage Attorney for More Information

At Mara Law Firm, we help employees at every stage of their unpaid wage claim. Whether you want to discuss concerns you have about unpaid wages, or you know that your employer violated your rights, our legal team is ready to help.

Our consultations are always free and confidential, so you have nothing to lose by reaching out so we can evaluate your rights. Call (619) 234-2833 or contact us online to learn more about our services and whether or not you have a valid claim.

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