When Company Property Doesn’t Come Back: Practical Steps for Employers

 

Few situations are more frustrating for employers than trying to recover company property from a former employee who has already moved on. In many cases, the separation itself may have been difficult, and the last thing a manager wants is another unresolved issue to handle. Unreturned laptops, phones, tools, vehicles, and other equipment can represent a significant loss of company assets and, in some cases, may also contain sensitive company data.

 

What often begins as a simple request to return company property can quickly turn into a series of unanswered emails or vague promises that the item will be returned “soon.” For employers, this can create operational headaches, potential data security risks, and additional administrative work. While there is no guaranteed way to avoid every issue, employers can take several steps to improve the chances of recovering company property efficiently and safely.

 

As soon as an employee separates from the company, take steps to limit further access to company resources. Cancel company credit cards and building access if applicable, and have IT disable all access to company systems. Many employers complete these steps immediately before or during the termination meeting to reduce risk.

 

If the termination occurs onsite, collect all company property immediately after the termination meeting, before the employee leaves the premises. This may include laptops, phones, badges, tools, or other equipment. Recovering property at that moment can prevent future complications.

 

If severance is offered, include clear language in the severance agreement requiring the employee to return all company property by a specified deadline before severance payments are issued. This can provide additional incentive for timely compliance.

 

If the termination occurs remotely and severance is not involved, consider sending the former employee a self-addressed, prepaid shipping box to make returning equipment as simple as possible. If packing or shipping may be difficult for the individual, you might arrange for a trusted company employee to assist with pickup. However, always prioritize safety; no employee should be sent alone to retrieve property from a former employee’s home. If a company vehicle must be repossessed, it is often advisable to have law enforcement accompany your employee and the towing service.

 

Employers sometimes consider deducting the value of unreturned property from an employee’s final paycheck. However, this approach can be legally risky. Many state laws prohibit or severely restrict wage deductions, even for unreturned company equipment. In some situations, deductions could also raise issues under the federal Fair Labor Standards Act, particularly for exempt employees. Before attempting to recover costs through payroll deductions, consult with legal counsel. Additionally, consider having employees sign a deduction authorization form for lost, damaged, or unreturned property at the time of assigning the property if your state allows; this way, if property is not returned at separation, you already have written authorization to perform a legal wage deduction if federal, state, or local law allows.

 

If reasonable efforts to recover the property fail, employers may need to escalate the matter. Options may include filing a civil claim to recover the property or its value, or, in certain cases, pursuing criminal charges for theft of company property. While these steps are rarely pleasant, courts are generally more receptive when an employer has clearly documented good-faith efforts to resolve the situation first.

 

Recovering company property isn’t always straightforward, especially when emotions and logistics complicate the situation. By planning ahead, acting promptly during separations, and using clear processes for returns, employers can reduce the likelihood of property disputes and protect both their assets and their employees in the process.