DealersEdge Professional Forums

I don't know why but recently our dealerships have had a run of employees not returning the company issued uniforms upon release of employment. I contacted our legal person and wanted policy to have employees sign, but have been advised it is not legal. We cant legally hold last paycheck until they are returned either. We were told federal labor law looks at it as a cost of doing business, which just isn't right in my book. So that leaves me with small claims court, which I am pursuing at this time with a few former employees as we talking about close to $1000.00 for 5 employees at this time. How do other dealerships address this situation??
Laws may vary in different states, we are in New York state.

You are correct that the law does forbid you from withholding that check, HOWEVER, if you tell an employee, "Your final check will be here next friday, make sure to bring in your uniforms to pick it up", you are not directly threatening to withhold the check, but you are leading them to think that. It as worked fine for our dealer. We have never had to actually "test" wether or not the employee would say "Im not giving back the uniforms, but I want the check anyway". If push came to shove, im sure we would have to make a decision to give the check.

Of course there are some guys that are a shirt or pair of pants short, but thats not as big an issue as 11 shirts and 11 pants.

Greg

We hold checks and have never been challenged...yet. Nor have we had a real problem in this area. We don't fuss over a shirt here or there....just not worth the aggravation. A full set of 11 shirts, 11 pants, and 2 jackets is another story. I'd go to small claims over that just on GP.

Our employee manual prohibits loss, theft, or negligent use of company property. It's not much of a stretch to consider uniforms as company property. (In fact, for some of our staff, we do actually purchase the uniforms outright and simply pay for laundering.)

I worked at one dealer that held a $200 unform desposit. Seldom had any missing uniforms, but what an accounting hassle. Never was sure if it was 100% leagal but, again, never challenged.

I heard of one store where the techs rented the uniforms and were reimbursed each paycheck....technically any shortages were between the employee and the uniform company. I doubt any uniform company would tolerate that hassle nowadays.

Good luck
Doug

This has everything to do with the individual states laws but in Maryland we found a way around the laws prohibiting you from deducting monies from employees pay. Actually a state investigator told me about this loophole. If we called the deduction a payroll advance and the employee signed it then it is allowed under the law. However we did have each new employee sign a form that authorized us to deduct the weekly uniform amount from their pay as well as say that they were responsible for the return of the uniforms upon separation from the dealership. Apparently you have to have their written consent for any deductions not required by law.

There is no getting around the fact that the maintenance and return of uniforms is a huge hassle.


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Frank Burrows
Automotive Business Solutions LLC
frank@autobusiness.org

As the last post indicated, you need written consent for this kind of deduction. Nothing prohibits you from setting it up that way in advance. Assuming you deduct an amount e.g. $5 per week for the uniform expense, you should have the employee's written authorization to deduct that expense from their pay. In the text of that authorization you also can stipulate that they agree if the uniform is not returned at the end of employment that the expense will be withheld from the final check. Our legal counsel (Fisher and Phillips) signed off on this policy. It won't help you with an existing case but it will help prevent in the future.