Should You Reimburse for Office Expenses?

Last year, businesses across the country were forced to quickly move to remote work, doing their best to stop the spread of COVID-19. Employees who had never worked remotely found themselves in need of a home workspace, equipment, supplies, etc.: the necessities to successfully work from home.

With more employees than ever working remotely, employers are asking if they should reimburse employees for remote working expenses. Federal law dictates that employers must reimburse employees for anything that puts them below minimum wage. This federal law provides a low bar for employers; state and local laws often stipulate stricter reimbursement requirements. That said, experts strongly suggest going beyond what is legally required to ensure that employees are supported and provided with the tools they need to succeed.

A study by the National Institute for Family Finance Information in the Netherlands found that their workers on average spend $2.40 per day to support their ability to work remotely. In the Netherlands, employers are required to reimburse workers for these expenses. In the United States, statistics on employee spending for remote work are similar, with one in three employees reporting having purchased supplies and/or equipment to successfully work from home. Despite the similarity in employee spending, only 63% of employees report employers’ willingness to reimburse them for work-related expenses.

It’s important to mitigate any risk of non-compliance. Closely monitor employee expenses to ensure that they do not fall below minimum wage and know how state and local laws apply to your organization. In addition, closely monitoring legal cases in your local and state courts can ensure you stay ahead of compliance issues as decisions are made and legislation changes.

Beyond issues of compliance, it is important to know the impact that choosing to reimburse, or not to reimburse, employees can have on employee morale and loyalty. Studies show strong correlations between employee creativity and innovation and their access to the necessary tools to succeed in remote work. Beyond legality, reimbursement can ensure your employees feel supported and valued for their work.

As organizations across the country move back to in-person work, experts suggest taking a closer look at your remote work policies, including reimbursing employees for work expenses. In the long-term, providing opportunities for well-supported remote work could lead your organization to increased success, and policies and procedures should adequately support these efforts. Do your best to be aware of legislation at every level and to keep an open dialogue, so you can understand what your employees need when working in the office or remotely.

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