Can an Ohio employer withhold pay from a terminated employee who does not return company property? (i.e. building keys, uniforms, company reference materials)
Where can I find written guidance, preferably on the internet.
Thank you.
-C

Note: I am inquiring regarding making a deduction on a former employee check for unreturned company property. Specifically, keys issued to the employee which are for a client office and locked accounting storage room.

Are you talking about deducting the cost of the unreturned items from the employee's pay, or not giving the employee his check until he returns the company property?

The final pay check would be issued however, a deposit would be held back for unreturned company property.
Thank you,
C

Then I personally don't know the answer, though there are regular responders here who will (hold on for them).

In most states this would not be permitted, at least not without a written authorization from the employee. However, Ohio is among the states with weaker wage and hour laws, so I'm not going to say conclusively that it's impossible. Patty or DAW or Robb will be by with more information for you, I'm sure.

Here is another piece of information, in case it matters.

Our company manual states the following:

Any company property issued to you...must be returned to "the Company" at the time of your dismissal or resignation, or whenever it is requested by your manager or a member of management. You are responsible to pay for any lost or damaged items. The value of any property issued and not returned may be deducted from your paycheck, and you may be required to sign a wage deduction authorization for this purpose.

The employee signed a statement indicating they understood all policies after acceptance of the handbook.

Ohio law is silent on whether or not a signed authorization must be in effect to make such a deduction. Did the employee sign such a wage deduction authorization as mentioned in the policy? Even beforehand, this would probably hold up in Ohio. Except, of course, that such deductions may not bring the employee's pay below minimum wage, if nonexempt.

If exempt, the law gets a little trickier.

It seems the policy is clear based on your post about the employee handbook. Often when company property is issued to an employee (i.e. company cell phone), the company will have the employee sign a release stating the value of the property and terms should it be damaged, lost or unreturned at termination.

If the property agreement did not state this and no deduction agreement exists, the employer would be hardpressed to defend a payroll deduction (or "deposit" as you term it) for unreturned company property.

Please keep in mind that even though the deduction may not be lawful, the employee may be held accountable for the return of the equipment or its value if unreturned. The former employer may file a civil complaint against employee. Based on your post, I am confident that the employer would prevail.

I am not sure if you are the employer or employee here. If you are the employee, why not return the equipment and make life easier for yourself?

Ohio law is silent on whether or not a signed authorization must be in effect to make such a deduction. Did the employee sign such a wage deduction authorization as mentioned in the policy? Even beforehand, this would probably hold up in Ohio. Except, of course, that such deductions may not bring the employee's pay below minimum wage, if nonexempt.

If exempt, the law gets a little trickier.

Pattymd is correct about if the worker is exempt under FLSA. USDOL issued an opinion letter on this matter (FLSA2006-7). If this is the case, the employer may not deduct amounts for lost, damaged or unreturned equipment from an employee's paycheck (even if a deduction agreement exists). This does not leave the employer without recourse. A civil case could provide remedy if the employee is not willing to reimburse independently.

Thank you for all the great information.

In this case, I am the employer. I did not have the "former" employee sign an independant statement stating they would be charged for the item. However, with the written policy in the handbook about unreturned items, I didn't think that would be necessary.

If I am in the wrong, I will correct it.

To make matters worse for me, the "former" employee has a step-father who is an attorney. He has written me a letter on his firm's letterhead indicating that he has been retained for his "client."

His letter demands, that I return the deposit for the "lost" item, deliver her personal items to a third party (I offered, in writing, to hold the items at my office for 6 months for her pick-up) and finally to withdraw my claims so that she can collect unemployment (for which she was denied twice) or pay her severance. Here again, our company policy indicates we do not pay severance.