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Reader: I'm a retail area manager for a company tied to a larger company that's declaring bankruptcy. My colleagues and I are often expected to use our personal credit cards for business expenses — there's no corporate card, stipend or direct billing option to ease the burden.
My situation has spiraled out of control. I have been coerced into opening 13 personal credit cards to manage work-related costs and have fronted more than $70,000 in business expenses. I'm currently awaiting over $15,000 in unpaid reimbursements while my employer stalls, dismisses my requests and does not acknowledge the missing payments.
I've exhausted nearly every avenue. Government agencies are slow to respond; employment lawyers have deemed the case too small; and corporate leaders remain indifferent.
The more I've fought back, the more I've learned how deeply entrenched this practice has become. It's often brushed off as "just how business operates." Workers unable to shoulder corporate expenses are systemically shut out of promotions, leadership roles and career advancement. This is financial coercion. When saying "no" jeopardizes your job, career and livelihood, it ceases to be a choice.
How can workers like me voice these concerns when the very systems meant to protect us downplay the harm? At what point does an "inconvenient reimbursement policy" transform into financial exploitation?
Karla: As far as I'm concerned, exploitation occurs the moment an employee feels compelled to pay out of pocket for something that is the employer's responsibility.
As I noted last time I covered this topic, plenty of employees are happy to earn points, miles and cash returns by using their own cards to carry work-related expenses — provided the employer reimburses them promptly so that it doesn't hurt their credit score or tie up their personal cash flow. But workers who prefer not to use that option should never be pressured into doing so. "Common practice" doesn't mean "best practice."
Even worse, in some cases, it can amount to wage theft. Under federal law, if you're a nonexempt worker (someone who is paid hourly wages and entitled to overtime), it's illegal for your employer to make you pay an amount that effectively pushes you below minimum wage for that pay period, said Rachel Dempsey, an attorney with workers' rights nonprofit Towards Justice.
"Requiring an employee to pay an employer's business expenses is a de facto deduction of wages," Dempsey said. Also, while there's no set period for reimbursement, it "can't be delayed for longer than reasonably necessary," she noted.
In your case, the expenses you incurred may have been spread out over enough pay periods to avoid crossing that line — but I'm guessing the delay you've encountered goes well beyond a "reasonable" length of time.
Not to add to your stress, but given your employer's stalling and sidestepping your queries, I wonder if it's been off-loading debt to employees to disguise a shaky financial situation. If your firm ends up having to follow its distributor's lead into bankruptcy, it would be even harder for you to claim what you're owed.
So, for your own situation, I advise two immediate courses of action: Draw the line. You didn't specify how your employer managed to coerce you into this situation, but saying "my credit is maxed out and I cannot make any more purchases" doesn't leave much room for argument.
Keep asking for help. I'm surprised no employment lawyer is willing to at least write a letter on your behalf; $15,000 in unreimbursed expenses isn't exactly sofa change. You might have better luck searching for attorneys through Workplace Fairness (workplacefairness.org) or the National Employment Lawyers Association (NELA.org). For government support, Dempsey recommends focusing on getting through to the wage-and-hour administrator of your state's labor agency. (With the Trump administration's workforce reduction and overhaul efforts in the federal government, help from entities such as the Labor Department, the National Labor Relations Board and the Equal Employment Opportunity Commission will probably be harder than usual to come by.)
As for the big picture, all the evidence I've seen on employees paying work expenses with personal credit has been anecdotal rather than hard data. That's hardly surprising: Companies aren't going to publicize how much debt their workers are carrying for them, and employees who object to the practice may fear retaliation.
In that vein, I would like to hear from other workers who have been coerced to pay for employer expenses on their personal credit. Were you able to resolve it? Do you think it's becoming more widespread in the current economic environment?
Karla L. Miller advises on workplace dramas and traumas.
Previously:
• My boss wants me to install a work app on my personal phone