Is An Employer Required To Pay Mileage Reimbursement For Hourly Employees?

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Ian Marshall Profile
Ian Marshall answered
Though this is dependent on the company, however, it is generally enforced that any form of expenses that are incurred should be reimbursed. Employees often incur expenses on behalf of their employers.  For instance, salespersons may use their cars and mobile phones during the course of their duty. Other employees may purchase office supplies or advance payment for hotel rooms or meals. If these expenses have been incurred for the benefit of the company, or on the company‚Äôs instruction, then theses expenses should be reimbursed to the employee.

There are various methods that can be used to reimburse employees for expenses incurred. For instance, auto or car expenses can be repaid by using a mileage reimbursement method. This is because car expenses generally include repairs, insurance, registration, fuel, maintenance and depreciation. It would be difficult and burdensome for employees to keep track of all such expenses and to differentiate the expenses between work-related trips and personal use of the car.  It would likewise be burdensome for employers to review all the paperwork prepared by employees in connection with their actual expenses.

So to avoid this potential complication, most employers implement the mileage reimbursement method.  This involves, applying the Internal Revenue Service rate or some other rate agreed upon between employer and employee. This method is intended to include an approximation of fuel, maintenance and other costs of automobile operation per mile driven. However, employees are permitted to challenge the mileage reimbursement method if they believe that their actual expenses exceed the mileage reimbursement.

Alternatively, employers can also chose to pay a fixed lump sum that may be a per diem amount, a monthly sum or some other fixed stipend which is intended to reimburse employees for expenses. However, the amount paid must be sufficient to provide full reimbursement for actual expenses necessarily incurred.  This method works best when employees incur similar expenses day reimbursement method, employees retain the right to challenge the lump sum payment method if they believe the lump sum does not reimburse them for actual and reasonably incurred expenses.
Anonymous Profile
Anonymous answered
Does an employer have to pay mileage if I had to attend a hearing with the company in another state?
Anonymous Profile
Anonymous answered
This really depends on the company and your policies. If this errand was work specific and not just a favor, it should be expensed. It may also be required by law depending on the state your company operates. If the employee is asking for compensation, you may also want to consult your lawyer just to make see if you are legally bound to do so.
Fred Jones Profile
Fred Jones answered
It all depends on the employer. If you are required to drive for your job, it should be tax deductible just as being required to wear a certain uniform is. The employer may chose to reimburse you for driving but is not required to.
thanked the writer.
w smithen
w smithen commented
usually the employee just works in the office on occasion I have them drop/pick up plans for me. It is not requisite for them to drive for work.
helen baillie-gutteridge Profile
You asked them to do it therefore you do have to pay. Why should they be out of pocket? Being on hourly pay does not affect the rights and wrongs of this.
Anonymous Profile
Anonymous answered
Does the company have to pay for mileages if the employee goes to the office to work during the holidays, but the employee do get lieu time off afterward?
Anonymous Profile
Anonymous answered
If an employer does not have to adhere to the IRS guide of reimburseable mileage rate and are instead creating a company policy around it what is an acceptable method of reimbursing the employee?

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