Mileage: Do Employers Have To Pay a Nanny Mileage For Using Her Car?

If your nanny uses her own car for work, paying her for mileage at the current IRS reimbursement rate is more than a good idea, it’s the law.

Tom Breedlove of Breedlove & Associates says, “Mileage reimbursement requirements are not specifically covered under federal employment law, but California explicitly mandates that employers reimburse at the IRS mileage reimbursement rate. Beyond California, many other states have upheld mileage reimbursements in small-claims courts under the premise that employers are generally responsible for upholding the contracted pay rate after on-the-job expenses have been accounted for. In other words, if I agree to pay Suzy $10/hr, but I ask her to run errands for me that end up costing her $1/hour in automobile expenses, then by failing to reimburse her, I have not paid her what I promised and contractually agreed to. As a result, Suzy could file a wage dispute and the court would rule in her favor. Due to the potential liability in all states (and explicit requirements in California) – as well as fairness and decency – we advise all families to reimburse their employee(s) at the IRS mileage reimbursement rate.”

The IRS mileage rate covers all driving related expenses including gas, maintenance, repairs and insurance. On July 1st, 2011 the rate was raised to 55.5 cents per mile.

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