California Per Diem Laws

As of September 2021, California labor laws had specific regulations related to per diem expenses for employees. Laws can change, so if diem employees have a labor dispute or questions regarding business expenses, it’s crucial to consult with an employment attorney or check with the California Department of Labor or Employment Development Department for the most current information.

1. Per Diem Payments: California employers may provide per diem employees payments to to cover business expenses incurred while traveling for work. These payments are intended to cover meals, lodging, and other incidental expenses so employees do not have to pay out-of-pocket expenses.
2. Tax Implications: Payments made to per diem workers may have tax implications. The Internal Revenue Service (IRS) sets specific per diem rates for meals and lodging in different locations, and any amount paid to employees above these rates may be subject to taxation.
3. Accountable vs. Non-accountable Plans: Employers in California often distinguish between accountable and non-accountable plans for per diem employee expenses.
   • Accountable Plan: Under this plan, per diem employees must provide receipts or other documentation for their expenses. If they do not spend the full per diem rate, they must return the excess to the employer. Per diem employee payments made under an accountable plan are typically not considered taxable income for the employee.
   • Non-accountable Plan: In a non-accountable plan, a per diem employee receives a fixed per diem amount without the need to provide receipts or return unused funds. Payments under a non-accountable plan may be considered taxable income.
4. IRS Per Diem Rates: Employers in California may use the IRS per diem rates as a guideline for determining the appropriate per diem labor amounts. These rates are updated annually and vary by location. Employers should ensure that their per diem employee payments are in compliance with these rates to avoid tax issues.
5. Employer Policies: Employers in California may establish their own policies regarding per diem payments, as long as those policies comply with state and federal laws. It’s important for both the employer and employees to be aware of their employer’s per diem policies.
6. Record-keeping: Employers and per diem employees should maintain accurate records of all per diem expenses, including receipts and documentation, to ensure compliance with tax and labor laws.

Per Diem Employee Rights in California

Per diem employees in California have certain rights and entitlements, just like other types of part time employees or full time employees. It’s important to understand that “per diem” typically refers to a payment method for covering work-related expenses, rather than a distinct employment status. Per diem payments are often used to reimburse employees for expenses incurred while traveling or working away from the workplace of office.

There are key employee rights and considerations for per diem employees in California:

1. Wages and Minimum Wage: Per diem employees in California are entitled to receive at least the state’s minimum wage for all hours worked. The minimum wage in California may vary depending on the size of the employer and the location, as some cities and counties have their own minimum wage rates that are higher than the state minimum.
2. Overtime Pay: Per diem employees are entitled to overtime pay if they work more than 8 hours in a workday or 40 hours in a workweek, unless they meet specific exemptions. Overtime pay is generally one and a half times the regular hourly rate.
3. Expense Reimbursement: As stated above, per diem employees are entitled to reimbursement for work-related expenses, such as travel, meals, and lodging, as long as these expenses are necessary and are incurred during the course of their employment.
4. Meal and Rest Breaks: Per diem employees in California have the right to meal and rest breaks. In general, employees are entitled to a 30-minute unpaid meal break if they work for more than 5 hours in a day. Additionally, they are entitled to 10-minute paid rest breaks for every 4 hours worked.
5. Health and Safety: California employers are required to provide a safe and healthy work environment for all employees, including per diem workers. Workers have the right to report safety concerns without fear of retaliation.
6. Discrimination and Harassment: Per diem employees are protected from discrimination and harassment based on characteristics such as race, gender, age, religion, and more. If they experience discrimination or harassment, they have the right to file a complaint.
7. Workers’ Compensation: Per diem employees who are injured or become ill while performing their job duties are generally eligible for workers’ compensation benefits. Workers’ compensation provides medical coverage and wage replacement for work-related injuries or illnesses.
8. Paystubs: Employers are required to provide itemized wage statements (paystubs) that include information about hours worked, wages earned, and deductions. Employees have the right to accurate and complete paystubs.
9. Access to Personnel Records: California employees, including per diem workers, have the right to request access to their personnel records. Employers must provide access within a reasonable time frame.

It’s essential for both employers and employees to be aware of their rights and obligations under California labor laws. If you have concerns about your rights as a per diem employee in California or believe your rights are being violated, you may want to consult with a skilled employment lawyer, like the ones at Lawyers for Justice, PC. Call (844) 568-1702 for a FREE consultation.

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