Employee Expense Reimbursement Requirements in North Dakota

At a glance

Requirements one by one

Necessary costs and losses tied directly to the work are covered

N.D.C.C. § 34-02-01 requires an employer to indemnify an employee for all the employee “necessarily expends or loses” in direct consequence of duties or obedience to employer directions.

The direction may be unlawful, but the protection does not extend to an employee who believed the direction was unlawful when obeying it. The section does not add a separate advance-approval or primary-benefit test.

Dual-use tools and equipment are expressly excluded

Section 34-02-01 excludes the cost of buying or renting tools of a trade or other equipment that the employee also uses outside the scope of employment. The exclusion turns on outside-work use; the statute does not create a fixed percentage or depreciation formula for mixed use.

Ordinary risks and specified coworker losses are excluded

Under § 34-02-02, an employer generally need not indemnify losses caused by the ordinary risks of the business. The section also excludes losses caused by a coworker's negligence in the same general business unless the employer failed to use ordinary care in selecting the culpable employee.

By contrast, § 34-02-03 says the employer must “in all cases” indemnify losses caused by the employer's want of ordinary care.

The statutes supply no claim or payment procedure

Sections 34-02-01 to 34-02-03 state no employee submission deadline, receipt form, itemization requirement, missing-document substitute, employer-policy rule, reimbursement cap, payment clock, payment method, interest provision, agency claim, statutory damages amount, attorney-fee rule, or limitations formula.

What trips people up

A tool may be necessary for the job and still fall outside the indemnity duty if the employee also uses it outside the scope of employment. Section 34-02-01 states that exclusion expressly.

The statute also does not set a category-specific mileage rate, phone percentage, travel allowance, or home-office amount. Its text supplies a necessary-cost and direct-consequence standard instead.

Common questions

Does North Dakota require advance approval?

Section 34-02-01 states no separate advance-approval requirement. It asks whether the necessary expense or loss directly resulted from duties or employer directions.

Must an employer pay for a tool the employee also uses personally?

Not under § 34-02-01's indemnity duty. The section excludes a tool of the trade or other equipment also used outside the scope of employment.

Is there a statutory deadline for submitting receipts?

Not in §§ 34-02-01 to 34-02-03. Those sections state no submission period or required receipt format.

Statutes and sources

• North Dakota Century Code official-version notice. The Legislative Branch identifies its online Century Code as the official version. Official notice (accessed July 14, 2026).
• N.D.C.C. §§ 34-02-01 to 34-02-03. Necessary expenditures and losses, unlawful directions, dual-use tools and equipment, ordinary risks, coworker negligence, and employer-carelessness losses. Official chapter PDF (accessed July 14, 2026).