April 26, 2022 | Category: Uncategorized

An employee recently notified the company that they are resigning to accept another job. As part of the offboarding process, the company expects the departing employee to return all company property provided to them on or before their last day of employment. But what if they don’t? What can an employer do?

This isn’t a new problem for employers, but it has become a more common concern due to the increase in remote work we have seen since the start of the pandemic. Employees may have been provided with laptops, monitors, phones, printers, etc. to allow them to do their work from home. When they leave, employers expect those items to be returned and routinely they are. However, on occasion they are not. What can employers do to prevent this from happening? What are their options if it does?

Set Expectations & Implement Processes For Return

Set expectations early. Employers should ensure that the use of company property, including the return at the end of employment, is clearly stated in company policy, remote work agreements, and reiterated in company trainings, where applicable. It should be clear to employees that any company property provided to them, including confidential and proprietary information, must be returned at the end of employment and/or at anytime requested by the company. There should be no surprises when employment ends.

Documentation will help now and later. Any company property that is issued to employees should be documented in enough detail to identify the item later and the receipt of company property should be acknowledged by the employee. This way both sides know what company property has been provided and what needs to be returned. It also helps if you need to determine the value of what is owed or pursue legal action (more on that below). If there has been any replacement of company property between when it was initially issued and the end of employment, that should be documented in the same way.

When it comes time for company property to be returned, make the process easy. The fewer obstacles in place when it comes to returning company property, the more likely it is to be returned. Remind the employee of the requirement to return company property on or before the last day of employment. Provide the employee with the listing of company property provided to them for ease in identifying what items the company is expecting to be returned. If the employee isn’t close to the company’s physical location, consider making arrangements to have the company property picked up or providing materials to have it sent to the company.

When Company Property Isn’t Returned – What Are The Options?

Of course, despite all best efforts, there will be times when company property isn’t returned. In those instances, employers need to be cautious in how they attempt to recoup any items of company property.

While a deduction from the employee’s final paycheck for the value of the items not returned or withholding the final paycheck until all company property is returned may seem like great solutions, they can result claims against the employer for violations of wage and hour law. Those violations can result in penalties which may be more than the value of the items lost. Be cautious.

Nevada law only permits an employer to make non-standard deductions from an employee’s paycheck when they have the employee’s written authorization. The written authorization must be specific as to amount, purpose, and date to be compliant. Therefore, even if an employee agreed to be responsible for the cost of any damaged or unreturned company property when it was provided to them, there would need to be something more, with the amount of the deduction and date it would be made, to be able to make the deduction.

Nevada law also requires that employers provide departing employees with their final paycheck within a certain period of time. Failing to do so result in penalties in the amount of a full day’s wages for each day the employee remains unpaid or 30 days, whichever is less. For employees who resign from employment, they must be paid within 7 days or the next regularly scheduled payday, whichever is sooner. Employees who are discharged, final pay is due immediately. However, penalties do not begin until 3 days has lapsed.

Pursuing legal action to recoup the property itself or its value is always an option. The choice to pursue legal action generally comes down to the time and cost involved to recover the property vs. the value of the items not returned. Employers should always consider this possibility when providing company property to employees.

Remote work will continue for the foreseeable future and is projected to grow over the next year. Researchers from Ladders project 25% of all professional jobs in North America will be remote by the end of 2022, with remote opportunities continuing to increase into 2023. Having solid policies and procedures in place will go a long way in ensuring that any company property issued will get returned.