When terminating an employee, especially in a remote work environment, it can be tricky to manage the return of home office equipment effectively. Mishandling this process can lead to lost or damaged equipment, security risks, and potential disputes. Below are the best practices to follow:

1. Inventory and documentation

Before any termination occurs, maintain a clear inventory of all equipment issued to remote employees. This inventory should include the make, model, serial number, and condition of each item. Employees should sign off on this list when they receive the equipment, acknowledging its receipt and condition.

2. Communication

When an employee is terminated, communicate clearly about the process for returning company property. Include this information in the termination letter or meeting. Outline which items need to be returned, how they should be packaged, and the deadline for their return. Clear communication helps set expectations and reduces the risk of disputes.

3. Shipping and logistics

Consider logistics in advance. If the employee is responsible for returning equipment, provide them with prepaid shipping labels and clear packing instructions. This ensures that the equipment is returned in good condition and on time. For more valuable items, consider arranging for a courier service to pick up the equipment directly from the employee’s home.

4. Security measures

Data security is a top priority when retrieving home office equipment. In many circumstances, it’s a best practice to remote wipe the devices on termination, rather than waiting for the equipment to be physically returned to the office. If the employee used personal devices for work, require them to delete any company-related data and confirm this in writing.

5. Condition and inspection

Upon receiving the returned equipment, inspect it immediately to assess its condition. Compare the returned items against the initial inventory list to ensure everything has been returned and is in acceptable condition. Document any damages or missing items. This documentation is crucial if a dispute arises. 

6. Legal considerations

In Ontario, the Employment Standards Act (ESA) governs aspects of termination, but it doesn’t specifically address the return of equipment. However, employers should ensure that their policies align with the ESA and any relevant employment agreements. If equipment is not returned or is returned damaged, consult with legal counsel before deducting any costs from the employee’s final pay. Unauthorized deductions can lead to disputes and potential claims.

7. Policy review and updates

Regularly review and update your remote work policies to include clear guidelines on equipment issuance, usage, and return. These policies should be communicated to all employees upon hire and reiterated periodically, especially as your company updates its technology and equipment.

8. Final pay and holdbacks

In some cases, employers might be tempted to withhold a portion of the final pay until the equipment is returned and assessed. However, this approach should be used cautiously and in compliance with the ESA as an employee is always entitled to their full amount of “wages” due to them on termination, regardless of the equipment issues unless there is an explicit written authorization.   

Pick your battles

In many cases, the physical equipment is a minor part of the overall assets and costs at risk. The real business asset of value is the digital information the employee may have on their laptop, phone, or pads of paper in the office or somewhere in the cloud in non-company or non-authorized locations. In the world of tight time resources, we always recommend clients focus on the digital data first and in many cases, let go of the old printer, scanner or even outdated laptop that has not been carefully remote wiped. 

By following these best practices, you can minimize risks and ensure a smooth process when terminating remote employees. Proper planning and clear communication are key to protecting your company’s assets and maintaining security. 

By Lisa Stam