For employees who must travel, related expenses can really add up. In addition to paying for transportation, employees can spend large sums on lodging, food, and dry cleaning. They might also have to pay conference fees or for entertainment expenses if they are meeting with a client. Who is responsible for these expenses?
In New Jersey, no state law mandates who will pay New Jersey work travel expenses. Instead, that is up to the employer and employee. However, most employers will reimburse employees for these expenses because they can then claim them as a tax write-off. This lowers the overall tax burden on the employer.
If you must travel for your job, you should consider the following.
Read Your Company’s Policy
Every business should have a company travel policy spelled out in an employee manual or handbook. The policy could also be in the employment contract, if you have one. This policy should identify the different expenses that your employer will reimburse you for.
If there is no policy, then you don’t have legal rights to reimbursement. However, you should talk things over with your employer. If they don’t pay you, then they could lose a valuable employee.
Identify whether You are an Employee or Independent Contractor
Independent contractors pay for their own work-related travel expenses. If they want a client to pay, they should include those expenses as part of the freelancing agreement. Absent any legal agreement, the client isn’t required to pay anything.
If you are an independent contractor, you can deduct your work-related travel expenses on your taxes. Make sure to keep receipts, which the IRS might want to see.
Travel & Overtime Compensation
If you must travel for work, then the question arises whether this travel actually counts as work time. If you need to fly 6 hours to meet with a client, does your employer count those 6 hours as work for purposes of overtime? New Jersey law entitles all non-exempt employees to 1.5 times their base rate of pay for any hours worked over 40 in a week.
First, your daily commute to and from work does not count. If you travel a lot for your job, then commuting from home to your first appointment and from your last appointment back home does not count (usually). If you are asked to pick up something on your way into work, that is also considered “incidental” travel and probably doesn’t count.
However, if your employer instructs you to travel somewhere as part of your job, then that commuting time should count as work time. If you are a non-exempt employee, then this travel time could count toward overtime hours. However, independent contractors do not qualify for overtime.
Are You Being Discriminated Against?
An employer cannot choose to reimburse some employees but not others because of race, sex, religion, age, national origin, or another protected characteristic. If they are, then an employee could have a claim for employment discrimination.
Reach out to Sattiraju & Tharney, LLP if you have a question about work-related travel expenses. You can schedule a confidential consultation with a seasoned New Jersey employment law attorney.