Can I Charge an Employee for Breaking Something?

As an employer, you spend money to buy equipment to run your business, whether it's a catering company, resume writing service or landscaping firm. Because you are using your own money or money you obtained through a loan, you want to make sure your equipment is properly treated so it will last as long as possible. If you have an employee who breaks equipment, either through negligence or willfulness, you need to know how to recoup your loss.

Federal and State Law

You can require an employee to reimburse you for broken equipment – with some limitations. If the employee who broke a piece of equipment earns minimum wage, you cannot deduct anything from his pay, because that would drop his hourly pay below the federal minimum wage. It would be wise to prepare and add a "damage to company property policy" template to your employee handbook or training materials.

If your employee breaks a piece of equipment, such as a leaf blower, and you need to recover the cost of the item, you should have a signed authorization from this employee, so you can take the deduction from his paycheck. Have such a form – an employee damage company property letter – handy in your files in case you need it.