IL – Required expense reimbursement for your employees, not Bill Self
llinois Employers Should Review Expense Reimbursement Policies
Effective January 1, 2019, Illinois will statutorily require employers to reimburse employees for work-related expenses. This requirement comes as an amendment to the Illinois Wage Payment and Collection Act (IWPCA). Specifically, employers will be required to reimburse expenses or losses that employees incurred in the scope of their employment that are directly related to the services that the employee performs.
Employers are not required to reimburse employees for unauthorized expenses, expenses that were not required for work, losses resulting from negligence, normal wear, or theft (unless the theft was a result of the employer’s negligence). Employees must also follow an employer’s written reimbursement policies, which may include reasonable caps on expenses and other guidelines.
After this law goes into effect, employers should anticipate IWPCA claims being filed in Illinois over vehicle expenses, mobile device charges, home office expenses, and internet data-related fees. While such claims may appear to be fairly nominal or inconsequential on an individual basis, a current trend in employment litigation is to pursue these types of claims on a class basis for a substantial period of time.
In order to protect against possible claims, employers should implement clear written expense reimbursement policies before December 31, 2018.
EXPENSE REIMBURSEMENT POLICY
This policy is intended to assist employees in reporting and getting reimbursed for reasonable expenses incurred while conducting business for or on behalf of the Company. The Company expects employees to act responsibly and professionally when incurring and submitting expenses. Employees must adhere to the following general guidelines in order to be reimbursed for any expenses:
- Original receipts are required for reimbursement. If original receipts cannot be provided, employees must submit a signed statement explaining the missing receipts.
- All receipts and summaries must be submitted to the Accounting Department within 30 days of incurring the expense.
- All reimbursable expenses in excess of $100 are subject to prior written approval by the Company.
When submitting business meal expenses for reimbursement, please include:
- The business purpose, and/or
- The names of the participants and their affiliations or other information establishing a business relationship with the individual incurring the expense.
If you do not comply with the above guidelines, or your expense has not been approved in advance by your supervisor, the Company may deny your reimbursement request. In addition, if your expense was incurred as a result of your negligence or misconduct, for a loss caused by ordinary wear, or as a result of theft property, your expense may not be reimbursed by the Company.
This document is intended as a sample only, and is not tailored to the needs of any specific business organization. Each employer must establish policies and procedures that address its own business philosophy and human resources concerns within the limits of applicable law. It is highly advisable for an employer to consult with an attorney experienced in representing employers before adopting, modifying, publishing, or implementing any written employment policies and procedures.