Most workers have no idea their employer is legally required to cover travel costs. Seriously. In Massachusetts, the rules go further than almost any other state. If you travel for work and your boss isn’t paying up, you could be owed money right now.
Let’s break it all down.
What Is Per Diem?
“Per diem” is Latin for “per day.” It’s basically a daily payment your employer gives you to cover travel expenses. Think of it like a travel budget. Instead of saving every receipt, you get a set amount to spend on meals, a hotel, and small daily costs.
Pretty simple, right?
Per diem covers three main things: lodging (your hotel), meals (breakfast, lunch, dinner), and incidentals (tips, laundry, small fees). Some employers pay it as an advance before your trip. Others reimburse you after. Either way works, as long as the rules are followed.
Massachusetts Law: Reimbursement Is Not Optional
Okay, pause. Read this carefully.
Massachusetts is one of the few states in the country where reimbursing employees for work expenses is required by law. Your employer cannot legally skip this. It’s not a perk. It’s not a favor. It’s the law.
The rule comes from Massachusetts regulation 454 CMR 27.04. If an employee is required to report to a location other than their regular work site, the employer must compensate them for extra travel time and reimburse them for transportation expenses. That applies to driving to a different job site, traveling between locations during your workday, and trips that keep you away overnight.
Massachusetts has some of the strongest employee protection laws in the country regarding wages and expenses, which all private employers must follow. You’re not alone if you didn’t know this. Most people don’t.
When Does Your Employer Have to Pay?
Wondering if this applies to you? Here’s a quick breakdown.
Your employer owes you reimbursement when you drive to a job site that isn’t your normal workplace. They also owe you when you travel between locations during the workday. If an employer requires an employee to report to a location other than their regular work site, the employee must be compensated for all travel time in excess of their ordinary commute and reimbursed for transportation expenses.
So say you work at a Boston office but your boss sends you to a meeting in Worcester. That extra drive? Covered. The gas? Covered. Your normal commute to the office? That one’s on you.
Ordinary travel between home and work is not compensable working time. That’s the one exception. Your daily commute doesn’t count. But the moment your employer sends you somewhere different, the rules kick in.
Who Sets the Per Diem Rates in Massachusetts?
Here’s where it gets interesting.
Massachusetts does not set its own per diem rates. Instead, the state points to the federal government’s rates set by the General Services Administration, or GSA. Federal employees must use these rates. Private companies use them too, because they’re a safe and defensible way to meet Massachusetts law.
The standard lodging rate is $110 per night, and the meals and incidental expenses rate is $68 per day, effective from October 2025 through September 2026. But that’s just the baseline for areas without specific rates.
Boston is a different story. Boston and Cambridge (Suffolk and Middlesex Counties) have their own designated high-cost rates, and the Cape Cod islands have some of the highest seasonal per diem rates in the country, with a peak summer lodging rate of $462 per night from June through September and an off-season rate of $196.
Trust me, this works in your favor. High-cost areas get higher rates to match the real cost of staying there.
Current 2026 Per Diem Rates for Massachusetts
Stay with me here. These numbers matter.
For cities with specific per diem rates, such as Boston, the GSA offers fixed amounts that reflect local cost variations. For everywhere else in the state, the standard rate applies.
For any county in Massachusetts not specifically listed by the GSA, the standard CONUS rate applies, which for FY 2026 is $178 per day, covering $110 for lodging and $68 for meals and incidental expenses.
One more thing about travel days. On your first and last days of travel, you may receive only 75% of the full meal per diem rate. This accounts for partial travel days when employees typically do not incur the full cost of three meals. So if you travel in on a Monday and leave on a Wednesday, Monday and Wednesday get the reduced rate. Tuesday gets the full rate.
The Mileage Rule
This one surprises a lot of people.
According to Massachusetts regulation 454 CMR 27.04(4)(b), an employee required or directed to travel from one place to another after the beginning of or before the close of the workday must be compensated for all travel time and reimbursed for all transportation expenses.
That includes mileage when you drive your own car. The standard IRS reimbursement rate is 70 cents per mile in 2025, and most courts recognize that as the proper amount. So if you put 100 miles on your car running work errands, that’s $70 your employer owes you.
Honestly, this is the part most employees miss. They drive all week for work and never ask for a dime back.
What Happens If Your Employer Doesn’t Pay?
Now, here’s where things get serious.
An employer who fails to pay owed wages or reimburse required expenses can be held liable for triple the amount of the unpaid funds, plus attorney’s fees. Let that sink in. Not just the money you’re owed. Three times the money you’re owed.
Under Massachusetts law, employers violate the Massachusetts Wage Act when they fail to reimburse employees for expenses, including mileage, and these types of claims can have considerable value.
Think of it like a debt with a penalty multiplier. You’re owed $500 in missed reimbursements? Your employer could end up paying $1,500. That’s the law’s way of making sure employers take this seriously.
Is Per Diem Taxable?
Good question. Here’s the short version.
Per diem is not taxed if done correctly. But there are rules. Per diem payments are not part of the employee’s wages if the payment is equal to or less than the federal per diem rate and the employer receives an expense report from the employee. The employee must file the expense report with the employer within a reasonable period of time, which is 60 days.
So you have two jobs here. Your employer has to pay the right amount. You have to turn in your expense report on time.
Per diem payments under non-accountable plans are always taxable wages, regardless of the amount. This happens when employees aren’t required to provide the business purpose of their travel, don’t need to return excess amounts, or when the plan doesn’t meet other accountable plan requirements.
Basically, if your employer just hands you cash with no paperwork and no questions asked, that money is taxable. Keep your records clean and you’re fine.
What About Overnight Travel?
A friend asked me about this one last week. Turns out, it’s actually pretty clear.
Travel that keeps an employee away from home overnight is compensated in a manner consistent with federal overtime regulations under 29 C.F.R. § 785.39. That means your employer follows federal rules for overnight trips. The per diem rates for the specific city where you sleep are what apply.
A work assignment is considered temporary, and per diem stays tax-free, only if it is realistically expected to last one year or less. Once an assignment is expected to exceed one year, the IRS treats the location as your new tax home, and any per diem or travel allowance becomes taxable income.
So if you’re traveling to the same out-of-town site every week for two years, that situation changes. Worth knowing before you assume your per diem is always tax-free.
Remote Workers: A Gray Area
This part can be tricky, honestly.
Massachusetts regulations on travel reimbursement have not been updated or modified since the start of the pandemic and the proliferation of remote working situations, and they do not appear to contemplate work-from-home arrangements.
So if your home is your “regular work site,” the rules get complicated. If your employer asks you to come into the office, are they now sending you to a non-regular location? These questions haven’t been fully answered by the courts yet. If you work remotely and travel for work, talk to an employment lawyer about your specific situation.
What Employers Need to Do
If you’re an employer in Massachusetts, here’s what you need to know.
Massachusetts law does not set its own per diem rates, but it does require reimbursement. Employers must use a method, such as paying actual costs or using a per diem system, that fully covers the employee’s necessary expenses. Using the GSA rates is a very common and highly defensible way to meet this legal requirement.
You need a written travel policy. It should clearly state how employees get reimbursed, what rates you use, and how to submit expense reports. Vague policies create legal risk.
Because reimbursement is legally required, it is crucial for employers to have a clear and comprehensive travel policy. Using per diem is a common way to satisfy this obligation, but the allowance must be sufficient to cover the costs an employee reasonably incurs. If the per diem is not enough, the employer may be liable for the difference.
Less severe than a lawsuit, but still no joke: even a slightly too-low per diem rate can leave you exposed.
How to Claim Reimbursement as an Employee
Here’s what you need to do if your employer isn’t paying you back for work travel.
Start by documenting everything. Keep track of every work trip: the date, where you went, why you went, and what you spent. Save receipts for gas, hotels, and meals. Log your mileage.
Then submit an expense report to your employer. Most companies have a form for this. Do it within 60 days of the travel, because that’s the IRS rule for keeping things non-taxable.
If your employer refuses to reimburse you, you have options. You can file a complaint with the Massachusetts Attorney General’s office, which enforces the Wage Act. You can also contact an employment attorney. Remember: you could be owed triple damages. That makes these claims worth pursuing.
Frequently Asked Questions
Does Massachusetts require employers to reimburse work travel expenses? Yes. Massachusetts regulation 454 CMR 27.04 requires employers to reimburse employees for all transportation expenses when they travel for work during the workday or to a non-regular work location.
What is the standard per diem rate in Massachusetts for 2026? For areas without a specific rate, the GSA standard is $178 per day total, covering $110 for lodging and $68 for meals and incidentals. High-cost cities like Boston have higher rates.
Is per diem taxable in Massachusetts? Not if it follows IRS rules. Payments at or below federal per diem rates, with proper expense reports submitted within 60 days, are generally tax-free. Excess amounts or payments without documentation become taxable wages.
Can my employer give me less than the federal per diem rate? Technically yes, but only if that amount fully covers your actual necessary expenses. If it doesn’t, your employer may still be liable under Massachusetts law for the difference.
What happens if my employer refuses to reimburse me? You can file a complaint with the Massachusetts Attorney General’s office. Under the Massachusetts Wage Act, you could recover triple the amount you’re owed, plus attorney’s fees.
Does the per diem rule apply to remote workers? This is still a gray area in Massachusetts law. The regulations predate widespread remote work. If you’re a remote worker, consult an employment attorney for guidance specific to your situation.
What is the mileage reimbursement rate in Massachusetts in 2025? The IRS standard mileage rate for 2025 is 70 cents per mile, and Massachusetts courts generally recognize this as the appropriate reimbursement amount for work-related driving.
Final Thoughts
Now you know the basics. Massachusetts takes per diem and expense reimbursement seriously. More seriously than most states, honestly. Employees have real legal protections here. Employers have real legal obligations.
If you’re an employee, track your work travel and submit your expenses on time. If your employer isn’t paying you back, don’t let it slide. The law is on your side.
If you’re an employer, get a travel policy in writing, use GSA rates, and make sure your reimbursements actually cover what your employees spend. The triple damages rule is not something you want to find out about the hard way.
When in doubt, look it up or talk to a lawyer.
References
- 454 CMR 27.04 – Massachusetts Hours Worked Regulations (Official Text)
- GSA Per Diem Rates for Massachusetts – General Services Administration
- Massachusetts Attorney General – Wage and Hour Laws
- IRS Per Diem Rates FAQ – Internal Revenue Service
- Steffans Legal – Mileage Reimbursement Under the Massachusetts Wage Act
