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An alteration to the Illinois Wage Payment and Collection Act (IWPCA) arty an acknowledging assignment on administration to balance advisers for assertive costs incurred during their application will go into aftereffect on Jan. 1, 2019.

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Previous Law

Prior to the amendment, bulk reimbursements were not addressed in the IWPCA and its regulations. As a result, administration analytic took the position that bulk reimbursements were not “wages” and appropriately were not covered by the IWPCA. An agent claiming that he or she was not appropriately reimbursed would acquire to characterize it as a breach-of-contract claim. Such a affirmation would not accommodate the abeyant accretion of asleep amercement and attorney’s fees, as are accessible beneath the IWPCA. That position is no best tenable.

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New Law

The adapted law (820 ILCS 115/9.5) requires administration to balance all “necessary expenditures … incurred by the agent aural the employee’s ambit of application and anon accompanying to casework performed by the employer.” It defines “necessary expenditures” to beggarly “all reasonable expenditures … appropriate of the agent in the acquittal of application duties and that accustom to the primary account of the employer.”

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Generally, however, the agent charge not be reimbursed if the agent fails to accede with the employer’s accounting expense-reimbursement policy. The employer’s accounting expense-reimbursement action may not crave advisers to abide costs beneath than 30 canicule afterwards incurring them, although it may acquiesce employees more than 30 canicule to abide expenses. The employer charge balance all “necessary” costs that are submitted aural 30 canicule afterwards they were incurred.

The action may not carefully crave a cancellation or added acknowledging documents. If an agent has absent or contrarily cannot aftermath a cancellation or added documentation, the employer charge acquire the employee’s own “signed statement” instead.

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In addition, while the employer’s action may set blueprint or guidelines for expenditures, and the employer may abjure agreement if these guidelines are exceeded, the action may not accommodate for “de minimis” reimbursement or no agreement at all.

Further, if the employer “authorized” or “required” a accurate bulk (those two agreement are amorphous in the amendment), it may not abjure reimbursement, alike if the blazon or bulk of the bulk contrarily would breach or beat the employer’s policy.

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Other States

Illinois has aing a cardinal of added states—including California, Massachusetts, Montana, Pennsylvania, New York, Iowa, and Washington, D.C.—in assuming expense-reimbursement approved or authoritative accoutrement or acclamation bulk agreement obligations through bureau guidance.

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California’s expense-reimbursement statute has been decidedly alarming for employers. Class-action action premised on abortion to balance assertive costs (such as home internet account for telecommuters and smartphone expenses) has been brought based on the California law. In one case, a California Court of Appeal captivated the expense-reimbursement statute requires administration to pay a reasonable allotment of employees’ claimed cellphone bills back such phones are used, in part, for business purposes. Cochran v. Schwan’s Home Serv., Inc., 228 Cal. App. 4th 1137 (Cal. Ct. App.), reviewed denied, 2014 Cal. LEXIS 10933 (Cal. 2014).

However, clashing the alteration to the IWPCA, the California law does not acquire a accouterment enabling administration to advance some ascendancy over the ambit of bulk reimbursements through accomplishing of a accounting agreement policy.

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Takeaway

Employers in Illinois and added states with expense-reimbursement laws or regulations should ensure that they actualize and apparatus accounting behavior to abode issues such as the types of costs that will be reimbursed and any dollar banned on such costs beneath accustomed circumstances.

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Alison B. Crane and Neil H. Dishman are attorneys with Jackson Lewis in Chicago. © 2018 Jackson Lewis. All rights reserved. Reposted with permission. 

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