# Employee Expense Reimbursement in Illinois[^about] Illinois law requires reimbursement of authorized necessary work expenses and sets rules for written policies, documentation, and submission time. This note covers employee expense reimbursement in Illinois, including remote work costs and written expense policies. The [expense reimbursement practice guide](/practice-guides/expense-reimbursement) covers the broader topic. ## Must an employer in Illinois reimburse employee business expenses? {#reimbursement-duty} **Short answer.** An Illinois employer must reimburse necessary expenses or losses within an employee's work duties and directly related to its services when the employer authorized or required the expense. [^il-duty-a][^il-duty-b] The statute also allows liability when the employer fails to follow its own written reimbursement policy. [^il-duty-b] "(a) An employer shall reimburse an employee for all necessary expenditures or losses incurred by the employee within the employee's scope of employment and directly related to services performed for the employer."[^il-duty-a] ## Which business expenses must an Illinois employer reimburse? {#covered-expenses} **Short answer.** Illinois law covers reasonable expenses or losses required for work duties that primarily benefit the employer. [^il-covered-definition] The employer is not responsible for losses caused by the employee's negligence, normal wear, or theft unless the employer's negligence caused the theft. [^il-covered-exclusions] Liability also requires employer authorization or a requirement to incur the expense, unless the employer failed to follow its own written policy. [^il-covered-authorization] "As used in this Section, ‘necessary expenditures’ means all reasonable expenditures or losses required of the employee in the discharge of employment duties and that inure to the primary benefit of the employer."[^il-covered-definition] ## Must an Illinois employer reimburse remote-work costs such as home internet or a personal phone? {#remote-work-costs} **Short answer.** An Illinois employer must reimburse a remote-work cost only when it is a necessary work expense that the employer authorized or required, or when the employer failed to follow its own written policy. [^il-remote-definition][^il-remote-authorization] Section 9.5 does not separately name home internet, personal phones, or remote work. [^il-remote-text] A cost's connection to remote work alone does not establish reimbursement under the statutory test. [^il-remote-definition][^il-remote-authorization] ## Can an offer letter or expense policy in Illinois make the employee bear business expenses? {#waiver} **Short answer.** An Illinois employer may use a written policy to limit reimbursement above its expense specifications, but the policy cannot provide no reimbursement or only de minimis reimbursement. [^il-waiver-cap] An employee who fails to follow an established written reimbursement policy is not entitled to reimbursement under Section 9.5. [^il-waiver-compliance] Section 9.5 does not give an offer letter or agreement a separate power to erase the reimbursement duty. [^il-waiver-duty][^il-waiver-cap] "If the written expense reimbursement policy of an employer establishes specifications or guidelines for necessary expenditures, the employer is not liable under this Section for the portion of the expenditure amount that exceeds the specifications or guidelines of the policy so long as the employer does not institute a policy that provides for no reimbursement or de minimis reimbursement."[^il-waiver-cap] ## What happens in Illinois if an employer does not reimburse expenses? {#deadlines-and-remedies} **Short answer.** When an Illinois employer denies a request for an expense that should have been reimbursable, including by telling the employee not to seek reimbursement or by not responding, the employee may file a claim with the Illinois Department of Labor. [^il-admin-300-540-department-claim] Expenses the employee cannot recover during employment are included in the final compensation owed when the employment ends. [^il-admin-300-540-final-compensation] Section 9.5 also sets the employee's deadline: a necessary expense must be submitted with supporting documentation within 30 calendar days, unless a written policy gives more time. [^ilcs-115-9-5-thirty-day-submission] When documentation is nonexistent, missing, or lost, the employee must submit a signed statement about the receipts. [^il-missing-receipts] ## How does federal minimum-wage law limit unreimbursed expenses in Illinois? {#federal-floor} **Short answer.** Under 29 C.F.R. § 531.35, an employer that requires an employee to supply tools of the trade for the job violates the Fair Labor Standards Act in any workweek in which the employee's cost cuts into the minimum or overtime wages due. [^fed-531-35-tools] The regulation rests on the rule that wages count as paid only when they are paid free and clear, with no kick-back to the employer. [^fed-531-35-free-and-clear][^fed-531-35-kickback] The federal rule is a floor, not a general duty to reimburse. It is breached only when an employer-required cost pushes the week's pay below the minimum or overtime wages due. [^fed-531-35-tools] [^about]: By Steven Obiajulu, J.D. Published by [openagreements.org](https://openagreements.org). Last reviewed 2026-09-30. License: CC BY 4.0. Steven Obiajulu, J.D. is admitted in New York, not Illinois. This article synthesizes Illinois primary law and is not legal advice from an Illinois-admitted attorney. This article is for informational purposes only and does not create an attorney-client relationship. Source excerpts and linked materials belong to their owners. CC BY 4.0. Cite as Steven Obiajulu, *Employee Expense Reimbursement in Illinois*, OpenAgreements (last updated September 30, 2026), https://openagreements.org/practice-guides/expense-reimbursement/us/illinois. [^il-duty-a]: **820 ILCS 115/9.5** — "(a) An employer shall reimburse an employee for all necessary expenditures or losses incurred by the employee within the employee's scope of employment and directly related to services performed for the employer." *820 ILCS 115/9.5(a)* [^il-duty-b]: **820 ILCS 115/9.5** — "An employer is not liable under this Section unless the employer authorized or required the employee to incur the necessary expenditure or the employer failed to comply with its own written expense reimbursement policy." *820 ILCS 115/9.5(b)* [^il-covered-definition]: **820 ILCS 115/9.5** — "As used in this Section, ‘necessary expenditures’ means all reasonable expenditures or losses required of the employee in the discharge of employment duties and that inure to the primary benefit of the employer." *820 ILCS 115/9.5(a)* [^il-covered-exclusions]: **820 ILCS 115/9.5** — "An employer is not responsible for losses due to an employee's own negligence, losses due to normal wear, or losses due to theft unless the theft was a result of the employer's negligence." *820 ILCS 115/9.5(a)* [^il-covered-authorization]: **820 ILCS 115/9.5** — "An employer is not liable under this Section unless the employer authorized or required the employee to incur the necessary expenditure or the employer failed to comply with its own written expense reimbursement policy." *820 ILCS 115/9.5(b)* [^il-remote-definition]: **820 ILCS 115/9.5** — "As used in this Section, ‘necessary expenditures’ means all reasonable expenditures or losses required of the employee in the discharge of employment duties and that inure to the primary benefit of the employer." *820 ILCS 115/9.5(a)* [^il-remote-authorization]: **820 ILCS 115/9.5** — "An employer is not liable under this Section unless the employer authorized or required the employee to incur the necessary expenditure or the employer failed to comply with its own written expense reimbursement policy." *820 ILCS 115/9.5(b)* [^il-remote-text]: **820 ILCS 115/9.5** — "(a) An employer shall reimburse an employee for all necessary expenditures or losses incurred by the employee within the employee's scope of employment and directly related to services performed for the employer. As used in this Section, ‘necessary expenditures’ means all reasonable expenditures or losses required of the employee in the discharge of employment duties and that inure to the primary benefit of the employer." *820 ILCS 115/9.5(a)* [^il-waiver-cap]: **820 ILCS 115/9.5** — "If the written expense reimbursement policy of an employer establishes specifications or guidelines for necessary expenditures, the employer is not liable under this Section for the portion of the expenditure amount that exceeds the specifications or guidelines of the policy so long as the employer does not institute a policy that provides for no reimbursement or de minimis reimbursement." *820 ILCS 115/9.5(b)* [^il-waiver-compliance]: **820 ILCS 115/9.5** — "(b) An employee is not entitled to reimbursement under this Section if (i) the employer has an established written expense reimbursement policy and (ii) the employee failed to comply with the written expense reimbursement policy." *820 ILCS 115/9.5(b)* [^il-waiver-duty]: **820 ILCS 115/9.5** — "(a) An employer shall reimburse an employee for all necessary expenditures or losses incurred by the employee within the employee's scope of employment and directly related to services performed for the employer." *820 ILCS 115/9.5(a)* [^il-admin-300-540-department-claim]: **56 Ill. Adm. Code 300.540** — "1) If an employer denies a request for reimbursement that should have been reimbursable according to subsection (a), the following shall apply: A) If an employer has informed an employee that they are not entitled to seek reimbursement, or has failed to respond to an employee’s request for reimbursement, that shall be considered a denial of reimbursement and the employee may file a claim against the employer with the Department seeking reimbursement for expenses as provided under subsection (a); and" *56 Ill. Adm. Code 300.540(b)(1)(A)* [^il-admin-300-540-final-compensation]: **56 Ill. Adm. Code 300.540** — "B) If an employee cannot recover expenses incurred related to services performed for the employer during the course of the employee's employment, these expenses shall be included in the final compensation owed to an employee at the end of the employee's employment, in accordance with the Act." *56 Ill. Adm. Code 300.540(b)(1)(B)* [^ilcs-115-9-5-thirty-day-submission]: **820 ILCS 115/9.5** — "An employee shall submit any necessary expenditure with appropriate supporting documentation within 30 calendar days after incurring the expense, except that an employer may provide additional time for submitting requests for reimbursement in a written expense reimbursement policy." *820 ILCS 115/9.5(a)* [^il-missing-receipts]: **820 ILCS 115/9.5** — "Where supporting documentation is nonexistent, missing, or lost, the employee shall submit a signed statement regarding any such receipts." *820 ILCS 115/9.5(a)* [^fed-531-35-tools]: **29 C.F.R. § 531.35** — "For example, if it is a requirement of the employer that the employee must provide tools of the trade which will be used in or are specifically required for the performance of the employer's particular work, there would be a violation of the Act in any workweek when the cost of such tools purchased by the employee cuts into the minimum or overtime wages required to be paid him under the Act." *29 C.F.R. § 531.35* [^fed-531-35-free-and-clear]: **29 C.F.R. § 531.35** — "Whether in cash or in facilities, ‘wages’ cannot be considered to have been paid by the employer and received by the employee unless they are paid finally and unconditionally or ‘free and clear.’" *29 C.F.R. § 531.35* [^fed-531-35-kickback]: **29 C.F.R. § 531.35** — "The wage requirements of the Act will not be met where the employee ‘kicks-back’ directly or indirectly to the employer or to another person for the employer's benefit the whole or part of the wage delivered to the employee." *29 C.F.R. § 531.35* For repeat use, install the skill: `npx skills add open-agreements/open-agreements` (lawyer-reviewed agreement templates + 50-state practice guides).