Can Employer Charge Employee For Property Damage

    As an employer, you will spend money to buy equipment that runs your business – whether it’s a resume writing service, catering company, or landscaping firm. Because this is coming out of your own pocket and potentially through loans, as the boss, you want to ensure that these items are correctly cared for so they’ll last longer than expected! If one of your employees breaks something by being careless or on purpose, can the employer charge the employee for party damage? Let’s discuss it

    Federal and State Law

    You can need an employee to reimburse you for broken equipment – with some limitations. For example, suppose the person who broke a piece of company property earns less than $7.25 per hour in wages (or no wage). In that case, they cannot be required to pay any amount from their paycheck towards reimbursing that damage because it would drop them below minimum wage legal requirements set by federal law and regulation, which is currently at or above the rate of $15/hour depending on where your organization operates within its state’s boundaries.

    If your employee breaks a piece of equipment, like a leaf blower, and you need to recover the cost from their paycheck, an authorization form should be signed by them. Keep in mind that if they make less than minimum wage, then there is no deduction for company property because doing so would take away money from employees’ wages, making it below federal minimum wage.

    Prove Breakage

    Employees who carelessly break company equipment should be charged for damages. You can deduct from their paychecks until the charges have been paid off, but you’ll need to know exactly what your employee was doing at the time of the incident in order to charge them with breaking it on purpose and not just being careless. It’s also a good idea to keep an eye out to do anything else wrong while working around expensive items or customers’ property!

    Salaried Employees

    Your employees are your business! If they break equipment and the cost is high, you can’t deduct it from their paycheck to cover it. They’re paid on a guaranteed basis, so any deductions will lower their salary below what’s promised them. It may only be indirect responsibility but remember that if an employee has problems with something like this, they could easily say, “I quit!”.

    California as an Example

    California employers may only deduct damages from the paycheck of an employee for cash shortage, breakage, and equipment loss caused by gross negligence or a deliberate, dishonest act of an employee outlined in the California Department of Industrial Relations. This is because lost and damaged equipment are considered part of the cost of business doing, which means if it was not due to gross negligence or dishonesty on behalf of the employer, they could not take money out of their worker’s paychecks.


    What happens if an employee damage company property?

    If an employee’s misuse of property damages the company, their employer reserves the right to require them to pay for all or maybe part of repairing it. Misappropriation can also lead to termination and possible criminal action.

    Can the employer recover damages from an employee?

    Your employer may discipline you in a number of ways, up to and including firing. Additionally, your company can take legal action against you with the help of its own lawyer.

    Can an employer take money out of your wages for damages?

    Your employer can make a deduction from your pay if they overpaid you by mistake or your contract explicitly allows the deduction. Agreed-upon reductions in salary are not typically considered to be an “overpayment.” They, therefore, cannot qualify as grounds for deducting wages unless otherwise stated in writing before any work is performed.

    Can you fire someone for using drugs?

    Under the ADA, employers can terminate employees who are using drugs or alcohol on the job. This is because substance use may impact performance and productivity or create unsafe conditions for other workers.

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    Imelda Bouchard is the owner of Gov Relations. She graduated with a degree in Business Administration in Finance​ at the University of Houston-Downtown. Imelda has over a decade of experience working in the finance industry. Following her stint at an international fintech company, she has decided to create a platform where businesses can make use of great business ideas.

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