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Business Litigation Re Cell Phone Use Brings Up Valid Concern

Posted on in Business Litigation

Nearly everyone has a cell phone these days, and many people end up using one for work-related activities. Recent business litigation here in California brings up a valid concern for both employees and employers -- reimbursement to workers for on-the-job mobile phone use. A California appellate court recently affirmed the decision of the trail court that "reasonable compensation" for personal cell phone use at work must be made by employers.

The next logical question becomes what constitutes reasonable compensation. At present, there is no way to differentiate whether usage of a cell phone is personal or professional. Further, only a small percentage of companies provide such reimbursement. One study indicates that over half of all employees (54 percent) pay for work-related usage. Approximately 13 percent do receive partial reimbursement, while only 7 percent receive full reimbursement.

In many of those cases, expense reports must be submitted and processed, which costs companies time and money in addition to any reimbursements. Some companies provide a flat rate of reimbursement for cell phone use at work, but determining an amount that is fair to both employer and employee can be problematic. Moreover, the amount could become cost prohibitive for smaller companies.

The recent court ruling could lead to additional business litigation by employees who have not been receiving reimbursement for the use of their personal cell phones for work duties. California companies could spend valuable time and resources on court proceedings because they do not have a policy to cover this expense. It is likely in a company's best interest to create a policy that not only complies with labor laws but is also fair to both employers and employees.

Source: Forbes, " BYOD Legislation: What California's Case Could Mean For Businesses Everywhere ", Ben Rotholtz, June 25, 2015

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