On her Employee Handbooks Blog Jill Pugh discusses 10 things to keep in mind if you need to fire an employee.
A no-no I see the most on the list is the desire to withhold money from the employee’s last paycheck. (See No. 5).
Employees are often issued laptops, cell phones and other technologies. Unfortunately employees will often fail to return equipment when they leave the company. When that happens many employers want to deduct the value of the equipment from the employee’s last check. Iowa employers must familarize themselves with Iowa Code Chapter 91A.5 concerning deductions from wages. This chapter prohibits an Iowa employer from withholding or diverting all or a portion of an employee’s wages unless permitted by state or federal law or a court order. An employer may be allowed to deduct wages if the employer has written authorization from the employee to deduct for a lawful purpose that benefits the employee.
Consequently an employer may want to consider a written agreement with the employee upon issuance of the equipment. The agreement should authorize the employer to deduct the value of the equipment from wages if the equipment is not returned. With the appropriate language an employer may be allowed to deduct from the last paycheck.
Please be sure to consult an employment lawyer for specific advice concerning your circumstances.