Tools and Equipment

“I prefer having employees use their own tools for work because they tend to take better care of them and I have the added benefit of saving money.”

Your HR Survival Tip

When you require your employees to use their personal tools or other equipment, such as cell phones, computers, cars, etc., you may not be saving much money if you’re doing things properly. How do you reconcile what you’re doing against the state and Federal rules that it should cost employees nothing to work for you?

The basic thing to remember is the company is responsible for providing the employee with any and all tools or equipment needed to do the job. If you aren’t providing these items, you must reimburse the employee in some way for using their personal tools or equipment.

  • Tools — If you have a business where employees are using hand and/or power tools, California requires you to pay the employee at least twice the minimum wage if they must provide their own tools. Otherwise, you must provide and maintain the tools.

  • Equipment — If your employees were working in your office, you’d provide a desk, computer, office phone, internet, etc. While you aren’t required to provide the office furniture, you are required to reimburse employees for any of their personal equipment you are having them use instead of providing them with that equipment. The courts haven’t cited a specific amount but it must be considered a reasonable and fair exchange.

  • Travel — If your employees must use their own vehicle for anything other than the commute to work, you need to reimburse them for mileage (and in most cases, pay for their time). The standard is the current IRS (Internal Revenue Service) per mile rate because it is calculated to cover all costs associated with using a vehicle, such as gas and vehicle maintenance.

You’re in business… rarely is anything free. The government requires you to pay for anything needed to operate your business, including the cost of employees and what they need for their work. While you still may be able to save money using the employee’s personal tools and equipment, make sure you are doing it legally so this practice doesn’t end up costing you much more than expected.

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