Important Update for California Employers

An August 12, 2014 decision by the California Court of Appeals requires all California employers to reimburse their California employees a reasonable percentage of the employees’ personal cell phone bills if the employees’ job duties require them to use their cell phones for work purposes. While this ruling deals with cell phone calls, it will likely be extended to work related texts and emails also. The ruling applies even if an employee has a cell phone plan providing unlimited minutes or data; i.e. even when the employee does not incur any extra charges to use his or her cell phone at work.

This decision puts thousands of California employers at risk of statutory penalties and fines if they do not promptly comply. The penalties for not timely reimbursing employees for employment related expenses is substantial and we expect to see claims against large and small employers forthcoming.

While each employer’s response to this new rule will differ depending on the nature of the business and the number of employees involved, every employer should immediately develop a plan to avoid violating this rule. We have developed several compliance strategies for our clients already, and are encouraging our friends and clients to take steps to mitigate their risks as quickly as possible. The decision is Cochran v. Schwan’s Home Service, Inc.