When issuing company assets to employees, what guarantee do you have that you’ll get them back in one piece? Well, most companies use an Equipment Agreement to create an official record of the employee taking full legal responsibility for ensuring proper care & use of company-owned assets.
An Employee Equipment Agreement is an internal company document detailing the rights & responsibilities of each party about specific pieces of equipment used during the time of active employment. In case of loss or damage to company property, this agreement may be used as evidence in a disciplinary committee or a court of law.
A typical EE agreement comes with specific terms & conditions about:
- Ownership Rights
- Reporting of Damaged Equipment
- Employers’ Obligation to Repair
- Authorization of Off-site Use
- Authorized Use of Equipment
- Handling & Maintenance
- Employer’s Right to Audit
- Disciplinary Action for Negligence
Download our easy-to-use, pre-made template to create a formal equipment agreement, ensuring the safety of your company assets and promoting a smooth and responsible workflow.
Key Features of Our Template
- Primary Users: Employees/HR Departments
- Purpose: To lay down terms & conditions for the use & care of company-owned equipment
- Formats: PDF, Word, Google Docs, and ODT formats
- Level of Customizability: 100% Editable
Identifying the Parties
This section identifies the parties to the agreement: the employee and the employer. For both, names and postal addresses are required fields. This ensures that there is no confusion later as to the identity of either.
In case of employees, also supply the Employee ID assigned to them during the pre-boarding process.
Equipment Details
Specify the equipment being referred to in the agreement. These could be laptops, Employee ID cards, access keys, or any external storage such as hard drives where company data is stored. Additionally, it may include company credit cards (in the case of finance professionals), company cars, or even books and manuals.
For each equipment, we let you add a name, make, model, serial number, description, and other peripherals, ensuring there is no confusion as to which piece of equipment is being referred to:
If the agreement is about an office laptop, your filled-out entry should look like this:
- Name: HP Pavilion Laptop
- Make: Hewlett-Packard (HP)
- Model: HP Pavilion 15-eg2025nr
- Serial Number: 5CD3212XYZ (Example serial — you’d replace this with the actual one on your device)
- Description: 15.6″ Full HD laptop with Intel Core i7-1955U processor, 16GB RAM, 512GB SSD, Windows 11 Home, Intel Iris Xe graphics. Ideal for work, school, and light gaming.
- Other peripherals: HP wireless mouse, HP 27-inch external monitor, HP USB-C travel dock, Bluetooth keyboard.
Our default form lets you list up to 4 individual pieces of equipment. However, you can adjust this number to more or less using an editable version of the file!
Terms & Conditions
Now, onto the legal side of things. Use our standard agreement clauses to define the legal responsibilities, liabilities, and use restrictions of both parties. These clauses are designed to ensure proper care, use, and security of all company-owned equipment listed in the preceding section.
Here’s an easy, down-to-earth breakdown of each clause:
Ownership rights
This section is added because employers want to be very clear that just because employees are in possession of the equipment for months or use it daily, the equipment doesn’t become theirs. You are also covering your bases by forbidding tampering with markers or serial numbers, since those help you track the equipment.
Reporting of damaged equipment
This clause ensures that employees promptly report any damage to the equipment. This helps you detect problems early on. If something breaks, you want to know right away so it can be fixed before it gets worse. Employers don’t want employees to suffer in silence with a broken laptop; equally, they don’t want to pay for damage that occurred because employees didn’t speak up in time.
Employers’ obligation to repair
This clause details your (the employer’s) duty to undertake repairs in case of normal wear and tear. It then qualifies that obligation by not covering any damage caused as a result of negligence, misuse, or unauthorized modifications by the employee.
In other words, if a software wears out from normal use, the employer covers the cost. But if an employee spilled coffee on it or tried to “upgrade” it on their own, that’s on them.
Authorization of off-site use
This clause is about keeping a physical track of where the equipment is. You may be okay with employees taking equipment home or to a meeting — you just want to know when it’s leaving the building and who’s got it. Adding this clause ensures accountability if something goes missing or breaks outside work premises.
Authorized use of equipment
Employers don’t want their laptops to be used for non-work-related purposes like streaming movies. This is a big CYA (cover-your-assets) move that can also protect you legally if an employee ever uses the equipment to engage in malicious or illegal activities.
Handling & maintenance
In this clause, you instruct your employee to treat the equipment as if it were their own. This clause also warns employees that if they return the equipment all scratched up or broken, they might have to pay for repairs.
Employer’s right to audit
This clause is about monitoring and compliance. Every company wants the right to regularly check the equipment to make sure it’s being used properly.
Also, adding this clause permits you to look into data and usage as a way to catch potential misuse before it becomes a big issue.
Disciplinary action for negligence
This clause clearly states that if employees are negligent in fulfilling their duties under the agreement, appropriate disciplinary action will be taken against them.
If employees lose, steal, or damage something, employers have clearly outlined the consequences they may face. These could include suspension, termination, or requiring repayment, potentially even deducting it from the employee’s final paycheck (if permitted by the state where the employee works).
Feel free to use our Employee Disciplinary Action Form to implement consistent disciplinary standards across your organization, ensuring all employees are treated fairly.
Signature
As with every formal contract, you will need the dated signatures of both parties to make the agreement valid, authentic, and admissible as evidence during a disciplinary hearing or in a court of law.
Your responsibilities as an employee!
- Handling company equipment carefully
- Timely report any damage or loss
- Follow company policies on software installation and data security
- Keep equipment secure & out of reach of unauthorized persons
Final Thoughts!
Here’s the crux of an EE Agreement: “We (the company) are giving you some gear to help you do your job. Just take care of it, don’t misuse it, and let us know if something goes wrong. We’ll fix it if it’s not your fault — but if it is, be ready for some consequences.”
From laptops, desktops, and mobile phones to peripherals and software licenses, company equipment can hold sensitive information or business secrets. Losing or damaging such equipment can result in a loss or damage to the business, so make sure you handle company gadgets with a lot of care and never leave them unsupervised for too long!
For HR professionals in the midst of onboarding new staff, we recommend using this agreement as part of our New Hire Checklist for a smoother and more successful onboarding journey.
Note
Our template is fully editable and can be customized to meet your specific needs and requirements, making it ideal for organizations of any nature, size, or complexity.
Just fill in the appropriate information, upload your company logo, and share the form with your employees. You can customize the text of headings, add or remove Terms & Conditions, and place the clauses in a different order. In terms of formatting, you can easily change the fonts, colors and backgrounds as per your preferences.
Whether you integrate this form into your system or use it standalone – either way, you save hours in research, design, and formatting work!
