In most if not all states, employers are required to cover all business expenses, and supply all capital required for their business enterprises (e.g., tools, equipment, uniforms, work site, etc.). Thus, under California law, employers are in most cases required to reimburse employees for any business expenses they incur. (See Cal. Lab. Code sec. 2802.)
California has a small exception to this rule, set forth in various “wage orders,” which permit an employer to require an employee to provide their own tools or equipment, but only if the employee is paid at least twice minimum wage. Thus, California’s Industrial Commission Wage Order 4-2001, which covers “professional, technical, clerical, mechanical and similar occupations,” states at Section 9(B) that “[w]hen tools or equipment are required by the employer or are necessary to the performance of a job, such tools and equipment shall be provided and maintained by the employer, except that an employee whose wages are at least two (2) times the minimum wage provided herein may be required to provide and maintain hand tools and equipment customarily required by the trade or craft…”
The same language is also found in California’s Industrial Commission Wage Orders 1-2001 (covering workers in the manufacturing industry), 2-2001 (covering workers in the personal service industry), 3-2001 (covering workers in the canning, freezing, and preserving industry), 5-2001 (public housekeeping industry), 6-2001 (laundry, linen supply, dry cleaning and dying industry), 7-2001 (mercantile industry), 8-2001 (industries handling products after harvest), 9-2001 (covering workers in the transportation industry), 10-2001 (amusement and recreation industry), 11-2001 (broadcasting industry), 12-2001 (motion picture industry), 13-2001 (industries preparing agricultural products for market, on the farm), 14-2001 (agricultural occupations), 15-2001 (household occupations), and 16-2001 (certain on-site occupations in the construction, drilling, logging and mining industries). Thus, while this provision may not apply to every employee, it certainly applies to a vast number of employees in various occupations and industries.
The language in these orders, on its face, prohibits employers from requiring that employees supply their own tools or equipment in connection with their employment unless they are paid at least twice minimum wage. In application, this language has been interpreted as requiring employers who require an employee to provide their own tools or equipment to pay that employee a “tool wage” which is at least twice minimum wage. In other words, if an employee covered by any of these wage orders is required to supply their own tools or equipment, the minimum wage for that employee is double the standard minimum wage.
If an employee who is paid less than twice minimum wage is required to supply any of their own tools or equipment to do their job, that employee may very well have a claim for minimum wage violation and back wages which could be very substantial. In addition, there could be additional claims, violations, penalties, and interest that apply to such claims, as the violation of the “tool wage” law may also result in wage statement violations, waiting time penalties, and/or other violations of wage/hour laws.
In disputing claims based on the “tool wage” law, employers are likely to make certain arguments in their defense. One common argument is that the employee is not required to bring in their own tools or equipment, but voluntarily chooses to do so because they prefer their own tools or equipment to those the employer is able to provide. To rebut this argument, it is best for the employee to be very clear with the employer that they are required, not merely permitted, to use their own tools or equipment, and preferably get this in writing, text, email, etc.
Another possible defense an employer may make is that the employee in question does not fall into any of the covered categories in the various wage orders. For example, an employer may argue that a driver employed to provide limited roadside assistance (e.g., jump starts, tire changes) is not actually a “mechanic” covered by the wage order applicable to workers in the mechanical industry. While we believe such defenses are generally weak, it is best to have your situation evaluated by an experienced employment attorney to determine if, indeed, you qualify for the “tool wage” based on your actual job.
If you believe your employer (or past employer) has violated the “tool wage” law with respect to your employment, we encourage you to call us for a free consultation with one of our experienced employment attorneys to discuss whether you have a case worth pursuing.
