Company Property Not Returned at Termination

Document created by 1050210 on Nov 14, 2014
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Published Date: 09/15/2014


Pat; Rountree

By Pat Rountree


Wage and hour laws limit the ability of employers to make deductions from the final wage payment for company property that is not returned. The laws also prohibit holding payment beyond the regular payday until items are returned.


North Carolina requires that employers have a receipt for property received by an employee that authorizes the employer to make deductions if the property is not returned and specifies the reason for the deduction and the amount. When the deduction is for the employer’s benefit, the employee may not withdraw the authorization. The amount of deduction may not reduce the employee’s wages below minimum wage or affect the 1.5 overtime wages. For more information, see


For exempt employees, such deductions may not be made from the employee’s salary. Deductions may be made from other monies due the employee.


Employers may want to consider policies that require return of company property prior to payment of unused earned vacation at termination. Other options are to include provisions in expense reimbursement policies, bonus or commission documents that unreturned company property will be deducted from payments due.


Absent these options, with a signed receipt acknowledging the property was received and authorizing deduction, the employer may take legal action if the employee fails to return the property.


If you have additional questions about this issue, please contact a member of CAI's Advice & Resolution Team at 919‑878‑9222 or 336‑668‑7746.

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