Employers often provide equipment to their staff so that they are able to perform efficiently in their job as expected.

This equipment can take many forms: cars, mobile phones, laptops and uniform, to name a few. It’s important to remember that such items remain the property of the employer, and that they can cost a lot of money.

Damage to company property can be expensive for the employer to replace, not only for the immediate monetary cost involved, but also if an employee is hindered from fulfilling their job role as a result.

 

Covering the cost

Employers will generally try to recoup the cost of damages directly from the employee, but only when there is a clear contractual provision to do so, or if the employee has expressly agreed to cover the cost. In either case, the employee is expected to pay an accurate reflection of the cost of repair, never an arbitrary penalty amount.

Disciplinary rules also often contain a provision which states that damage caused to company property through neglect by the employee is something that the employee can be disciplined for.

 

Employer responsibility and unlawful deductions

It is the duty of the employer to make their staff aware of company policy for such deductions from the outset. This information should be included in every employment contract, signed and agreed by each employee. The employment contract forms a crucial reference point for an employer when asking a member of staff to cover the cost of any damages.

If the employer cannot provide a signed agreement then they won’t be able to deduct money from the employee and, if they do, the employee is within their rights to take the employer to a tribunal for unlawful deductions.

 

The law behind damage to company property

The Employment Rights Act 1996: Section 11 deals with protection against unlawful deductions.

Summary

  • Employers cannot deduct money from an employee to cover the cost of damages without having a clear signed agreement that states they are able to do so.
  • Unlawful deductions may lead the employee to take the employer to a tribunal.
  • Providing it has been agreed in their contract, the employee will be expected to pay an accurate reflection of the cost of the damages, never an arbitrary penalty charge.

 

Damage to company property is directly related to the following aspects of employment:

Disciplinary Rules

Misconduct

Contract of Employment