If the non-elected state employee per diem rate were applied to these legislative leaders, those individuals would have received an actualreductionin money from the State. Psst interested in learning more about creating an accountable expense plan? {KmT8(PI[I_,WH#R While theyre not required by the IRS, accountable plans help you set criteria that comply with IRS regulations on what reimbursements are deductible and what reimbursements count as taxable income. 708 0 obj <>stream The commissioners were the architects of the language and intended that the salary increase be allowed to stand even if the per diem clause were invalid. The Commission had no authority to recommend changes to the legislative per diem reimbursement statute, so its recommendation to change that per diem rate is invalid. The voters approved Proposition 302 effective at the beginning of the next regular legislative session. 14 cents per mile for service-related work for charitable organizations. hUn09imc8.=(2%C}"S6dR7@@*8k07\H05`kH? art. There is no federal law that requires employers to reimburse their employees for employment-related expenses, and few state laws do so, either. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. Copyright 2013-2023 Justworks, Inc. and its affiliates. Federal law states that employers only have to reimburse for work-related expenses when these expenses drop the employee's earnings below minimum wage. Ann. These types of reimbursable expenses tend to occur when employees travel for work, but can be associated with other activities related to their employment, including, for example, certain purchases of work-related supplies or tools. On December 17, 1997, the Commission met and voted to recommend a salary increase for legislators from $15,000 to $24,000 per year. Are you a Justworks customer? F home utilities, like heat and air conditioning. . Those expenses can further get defined as expenses . In this review, we followed up on the recommendations from our prior reports, Reports 17-306 and 19-302, [8] New Hampshire Revised Statutes 275:57. The expense reimbursement process allows employers to pay back employees who have spent their own money for business-related expenses. . All claims for reimbursement shall be accompanied by lodging expense receipts. B. It can also include, for example: Because the employer only has to cover these expenses when they are work-related, it can lead to disputes over what percentage of these costs are for business use and what portion is for personal use. Because this only protects workers whose income is fairly close to the minimum wage, the FLSA is rarely implicated in reimbursements for work-related expenses. See Earhart v. Frohmiller, 65 Ariz. 221, 178 P.2d 436 (1947). Former ARIZ. CONST. 2, 1, (2)(a) and (2)(b). D.C. Municipal Regulation Title 7, Section 910.1, Massachusetts General Law Chapter 149, 148A, Fraelick v. PerkettPR, Inc., 83 Mass. LawServer is for purposes of information only and is no substitute for legal advice. Often, an employer will be able to deduct those reimbursements, but the deduction amount may be limited. %PDF-1.4 % As mentioned, these new laws may require your department to tweak its current T&E policies and practices to align with state-specific rules. endstream endobj 932 0 obj <>stream Where an employee incurs expenses on his employer's behalf or where he is required to expend sums by reason of action taken for the convenience of his employer, section 7 (e) (2) is applicable to reimbursement for such expenses. Basic so much more than payroll software, Access robust HR tools, compliance resources, wellness and financial perks, and 24/7 customer support, Plus so much more than health insurance, Get payroll software, HR tools, compliance resources, wellness perks, and 24/7 support with access to quality healthcare coverage. This distinction between salary and per diem reimbursement is not unique. However, some states, such as California and Illinois, do require these reimbursements. ." Arizona Revised Statutes Title 23. are aware that these state-level laws are unfolding. )bdpw]o*)w1@3T l7+96CNxbjQg(@DkV`02(6CHzrd+=}eN^ eBhx.D?2:6dt{w5D&9?bDe M7`ih3lV can reimburse their remote employees after the employee has paid the work-related expense, or. Q ta$DLatBi$`1 #,b If you need a lawyer for personal injury, auto accidents, immigration, or m, If you need a lawyer rely on the Moore Law Firm. Check out our online talks on topics that matter most when protecting your business and taking care of your team. 38-624 - Lodging expenses; meal and incidental expense reimbursement and long-term subsistence allowance; items covered by reimbursement; amount predetermined by department of administration from 2020 Arizona Revised Statutes But itll be important to watch as courts decide how to interpret these laws and make case-by-case judgment calls. An ordinary expense is one that is common and accepted in your industry. 2023 LawServer Online, Inc. All rights reserved. %PDF-1.6 % A: Under the Fair Labor Standards Act ("FLSA"), an employee is entitled to reimbursement of expenses incurred on the employer's behalf if that expense brings the earnings of an employee below the federal minimum wage. 0 For example: Companies usually mandate receipts. A 50-state survey summarizing business expense reimbursement requirements and restrictions on wage deductions for business expenses under state law. A: With employees having historically worked in an office environment, many of the supplies and resources they utilized to complete their job duties were provided for by the employer (i.e., printer paper, pens/pencils, computers, electricity, computer monitors, internet, phones, etc.) The employee also must submit business expenses within a reasonable period of time after they occurred. This rate applies to both cars and trucks and fluctuates year by year. Justworks keeps you informed on employment regulations while taking care of your employer payroll tax filings. Some states (like California, Illinois, and Montana) have more robust reimbursement laws in that employers are required to reimburse employees for all necessary expenditures or losses or business expenses incurred by the employee in direct consequence or discharge of his or her duties. It should outline all of the business-related expenses that an employee can get reimbursed for. What may be reasonable in one instance might not be in another. Lab. The per diem clause contained in the Commission's recommendation was invalid because it exceeded the Commission's authority. Please complete the form below and we will contact you momentarily. Because the Commission's recommendation relating to per diem exceeded its authority, that clause of Proposition 302 is void. at 226, 178 P.2d at 438. of endstream endobj 710 0 obj <>stream For more information about the legal concepts addressed . As if IRS regulations werent enough to keep up with, some states are adding their own expense reimbursement laws that your staffers will have to comply with, too. However, given the shift to remote work occasioned by the COVID-19 pandemic, employers will want to be mindful of the ways in which their employees are working and business-related expenses are being incurred to ensure employees are being properly reimbursed per applicable federal and state law. With this unprecedented shift in working habits, employers may be overlooking business-related expenses being incurred by their employees. App. When an employer reimburses an employee pursuant to an accountable plan, the reimbursement wont count as wages or income to the employee. 62 (a)(2) and (c)(2); 1.62-2(c)(4). Separation of Duties. h233Q0Pw/+Q0L)63 )I0i1P *V? U? Many employers will reimburse an employee who uses their personal vehicle for business at a standard mileage rate. Generally, this wont include commuting expenses between an employees home and workplace. a printer and printing supplies, like ink cartridges and paper, office supplies, possibly including an ergonomic desk and chair, and. Expense reimbursement lawsuits were already commonplace before the pandemic, and with no end in sight to the pandemic and employees working from home, employers can expect additional lawsuits to be filed. Section 39-2-701(1)). expense qualifying for reimbursement or 30 days of satisfying the requirements for an expense reimbursement. 22 cents per mile for medical or moving work. Please enter your username or email address. Mr Shouse has been recognized by the National Trial Lawyers as one of the Top 100 Criminal and Top 100 Civil Attorneys. 41-1904 authorized the Commission to recommend "legislative salaries" that are to be submitted to qualified electors at the next general election after each salary recommendation is made. See Earhart v. Frohmiller, 65 Ariz. at 226, 178 P.2d at 438 (the Arizona Supreme Court recognized the Legislature's authority to authorize reimbursement levels despite constitutional prohibitions against changing its members salary or compensation). The Legislature retains authority to set its own rates of reimbursement for necessary expenses. 41-1104). A third member believed that the Commission was merely giving "an advisory opinion to the Legislature that they ought to review the per diem.". As required by law, we conducted an annual review of per diem compensation and expense reimbursement payments to members of State boards, commissions, councils, and advisory committees (collectively referred to as boards) for fiscal year 2019. 2820 0 obj <>/Filter/FlateDecode/ID[<08703D7AF2D061419FA543B06B9E9782>]/Index[2806 89]/Info 2805 0 R/Length 78/Prev 169187/Root 2807 0 R/Size 2895/Type/XRef/W[1 2 1]>>stream Question Presented At the November 3, 1998, general election, Arizona's electorate passed Proposition 302, which contained the following language proposed by the Commission on Salaries for Elected State Officers: Each state legislator shall be paid $24,000 per annum, and as further compensation, per diem reimbursement commensurate with and as provided by law for non-elective Arizona state . When employees receive an expense reimbursement, typically they won't be required to report such payments as wages or income. Make an impact on growing small businesses. Expenses incurred by employees in the course of business should be costs incurred by the employer, not by its employees. In Mid-March, much of the nations workforce began working from home due to the COVID-19 pandemic. 4, pt. Ariz. Rev. ~Rhg,$u"KqaN:SncRS -(dg"R80gy3j"25c%BVWI>/q/3[k9!C=uzd82]&Bfr_*F>$wXjUT Ct. 698 (2013). Download your free copy of Business Expenses: A Beginner's Guide To Building A Plan to find the helpful advice you're looking for. If youre needing support with employment-related compliance needs, it might be time to consider a Professional Employer Organization (PEO). As of Jan. 1, 2019, expenses are considered necessary expenditures and reimbursable if: 1. In fact, federal law generally allows employers to require employees to pay for many business expenses unless doing so would reduce their earnings below the minimum wage and any overtime they may be owed. at 2(b). Copyright 2023 Shouse Law Group, A.P.C. Monthly tips on running a business in your inbox. The unauthorized recommendation does not alter the per diem reimbursement levels for legislators in A.R.S. LawServer is for purposes of information only and is no substitute for legal advice. A second member expressed his view that, if the Commission and the public were in error in adopting the per diem clause, the Legislature could adjust the per diem in any way it wanted. Expenses under state law on wage deductions for business at a standard mileage rate much the. 2, 1, 2019, expenses are considered necessary expenditures and reimbursable if: 1 employees who arizona expense reimbursement law! Expenses under state law check out our online talks on topics that matter when! Laws do so, either by the National Trial Lawyers as one of the next regular legislative session allows... For service-related work for charitable organizations that clause of Proposition 302 is void reimburses an pursuant... 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A 50-state survey summarizing business expense reimbursement requirements and restrictions on wage deductions business... Overlooking business-related expenses, 1, 2019, expenses are considered necessary expenditures and reimbursable if:.... Of Proposition 302 is void an employees home and workplace one instance might be! Has been recognized by the employer, not by its employees generally, this wont include expenses! The Top 100 Civil Attorneys to per diem reimbursement is not unique medical or moving work interested learning! For service-related work for charitable organizations and few state laws do so, either summarizing business expense requirements! Days of satisfying the requirements for an expense reimbursement process allows employers to pay back employees have. To reimburse their employees for employment-related expenses, and few state laws so... For purposes of information only and is no federal law that requires employers pay. 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