California state law requires employers to reimburse employees for expenses incurred in performing their jobs. Many other states, however, do not require this.
The IRS permits employers to pay 32.5 cents/mile to reimburse employees; if they pay this, it's a deductible business expense for the company and not considered income for the employee (if the employer pays more, the extra is not deductible and is taxable to the employee).
Interestingly, under California law, if the employer does not reimburse mileage, the employer is on the hook for all damages/losses caused by the business travel. So, in California, if the employee's car is stolen during a business trip, the company must pay to replace the car UNLESS they have a pre-existing mileage rate agreement. If the company pays mileage, it covers ALL expenses (gas, oil, insurance, replacement costs, etc.), so they wouldn't have to pay to replace a stolen car.
For more info, contact your state labor agency.