For many remote employers in 2022, permitting their team to work remotely has created unforeseen challenges. One of the costliest challenges is related to remote workers and returning equipment. Especially when workers may leave their job under unfavorable circumstances, there are often complications with returning company property. Many employees are returning to the office space full-time or on a hybrid basis, and sometimes still not returning company property. These employees may be enjoying the option of a home office or simply have forgotten to return laptops, cell phones, headsets, etc. MP’s HR experts share what employers and human resource departments should know about remote employees and best practices for the return of company equipment.
Returning Company Property: 3 Key Considerations for Employers
1. Risking compliance with state laws:
Employers should note that it’s often illegal to deduct the entire cost of missing equipment from an employee’s check or to withhold their whole paycheck. Many varying state laws govern deductions from an employee’s paycheck, including:
- how much may be deducted
- when it can be deducted
- how the money can be deducted
2. Damaging employee morale:
Before taking action to recoup the company’s property, employers should remember the value of employee engagement. Many employers have had staff that chose to work remotely long term. Many employees have been working long hours in the last two years to help their struggling business. Managers and HR departments should also consider that their teams have worked through the difficulties of a pandemic, including but not limited to: labor shortages, childcare challenges, sickness, quarantines and isolation, etc. Organizations with an employee who works through such challenges may want to be more lenient about how, when, or even if, work equipment is returned– especially if it doesn’t create extensive hardship and doesn’t contain proprietary information. In addition to the debt an employer may owe to a loyal employee, they should also consider the value of a happy, engaged team member. Research has repeatedly shown how productive, reliable, and valuable a happy employee is. Being too rigid about the procedures for returning equipment may not be worth the damage to employee morale.
3. Compromising the employer brand:
Employers that punish an ex-employee for not promptly returning company equipment may sustain damage to their employer brand. Angry former employers may spread the word to current employees or leave negative reviews online. During the current record-setting labor shortage, employers should be extra cautious about risking any damage to their employer brand.
Best practices for HR policies related to remote workers and returning equipment
Employers may use a few strategies to prevent challenges in recouping work equipment as their team returns to the office or moves on to new positions. Firstly, employers should write a policy for their employee handbook that explicitly covers the return of company property. They should distribute this policy and ask employees to sign an acknowledgment. The policy should include:
- A statement that equipment is company property and must be returned when employees are no longer working from home or their time with the company is done
- An authorization to deduct the value of any unreturned equipment from a paycheck, severance, or a final paycheck (depending on what state laws allow)
- Any remaining value that cannot be deducted from paychecks will either be paid by the employee deducted from their severance
5 Action Steps For Employers with Equipment Currently Missing
1. Formally remind employees that equipment is missing.
Whenever employees return to the office or terminate employment, it’s vital to be proactive about sending a prompt, clear reminder to return equipment. If there is a policy requiring the return of equipment, employers should add a copy to this official communication. If the employee had to sign acknowledgment of this policy, a copy of their signature page should also be included. When property is still missing, employers should send a new or follow-up notice. Again, the notice should contain the policy and signed acknowledgment.
2. Make it easy for employees to return the missing property.
It improves chances of getting equipment returned without incident if employers make it easier for the employee or ex-employee. Employers could offer an envelope or box that is both prepaid and prelabeled. If equipment is heavy and difficult to move around (or expensive to ship), they may want to offer to meet the employee somewhere (including their home) to pick up the missing items. Another iteration of this strategy is to use a third party to pick up the equipment. If the relationship between employee and employer ended negatively, a third party may be a necessary buffer to avoid further difficulties.
3. Consult with HR experts.
Employers may want to work with HR experts, like those at MP. Depending on the circumstance, they may also wish to consult with an employment lawyer who knows the laws in the jurisdiction of the employee and the company (each may be in a different state, with varying laws). In some cases, such as when the company property contains proprietary information or is particularly valuable, the employer may want to file a civil lawsuit or report a theft to law enforcement.
4. Lawfully recoup the value of the missing property via paychecks.
If it’s lawful in the states where the remote employee lives, the employer may choose to deduct the value of the unreturned property from non-exempt employees’ paychecks. Before deciding to take this action, employers should ensure they send at least one or two reminders that the equipment is missing and must be returned. Ideally, they should warn the employee they will be deducting the value of the missing equipment from their paycheck. They should also consult with the local laws to see what procedures they must comply with. These could include:
- Acquiring a signed acknowledgment stating the employee allows the money to be deducted from their paycheck
- Seeking out the money within a short window of time after employment is terminated
- Requirements surrounding last paychecks (if the employee is leaving the company)
It’s critical to remember that, per the Fair Labor Standards Act (FLSA), even if it’s entirely legal to deduct the cost of the missing equipment from paychecks, employers must not deduct so much that the employee’s pay falls below their applicable minimum wage. Some organizations may choose to deduct the amount of the missing equipment via multiple paychecks.
5. Invoice the employee for the value of the missing equipment.
If employers are unsuccessful in other strategies to recoup property, they may send the employee or ex-employee an invoice for the value of the missing items. If they choose to take the matter to small claims court, this invoice could be utilized in making their claim.
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