Who takes responsibility for company assets?

Sometime last year, there was news of a staff member who had mishandled company property in his possession. Precisely, he was involved in an accident with the company vehicle, and it had resulted in the death of a pedestrian. The unfortunate part though was that he absconded for fear of being lynched, and the vehicle was set ablaze by angry passers-by.

When the matter came to light, the company decided that it would pay for the burnt vehicle and structured monthly deductions over the span of two years. Within a couple of days, the staff disappeared without any proper resignation or notice, saying that there was no way he could survive on half his salary for two years.

This is a situation no business owner would want to find himself in, especially if he is just getting started and still has to battle with a budget deficit more often than not. Can this be avoided? Or maybe better managed? Yes.

Now to the question of the day; Who should take responsibility for company assets handed over to staff?

There are different assets that companies entrust to their staff. From gadgets like mobile phones, laptops, modems, or internet devices, to bigger assets like cars, houses, and the likes. For tech startups, such assets could mostly include laptops or other mobile devices. These assets are mostly entrusted to the staff, only for as long as they hold a particular position or remain on the company’s payroll. And so, if there is any reason for a suspension, demotion, resignation, or termination of appointment, the staff is naturally expected to return the same to the company.

Generally, we expect the staff to be responsible for the condition of the assets in their care. The error is that some businesses (mostly those without proper structure and processes) do not have a document spelling out the what-ifs of this arrangement.

What happens if the asset is returned in a condition worse than it was given?

Or what happens if the asset is not returned at all?

Is there any insurance cover for the asset, and what does it cover?

What happens if it has undergone the natural wear and tear expected of depreciable assets? For instance, it may not be realistic to expect staff to return a car in the same condition he had received it three years ago.

Is there any point in the arrangement that the asset can be foregone by the company, and fully claimed by the staff?

There are a lot of questions that can be answered in a clear document that will be signed by both parties before the asset is handed over. Some companies would rather avoid all of these by simply having the staff sort out things like transportation and accommodation, while the company pays a certain allowance annually for the purpose.

As a business owner or founder, you could opt for this. Otherwise, you could provide insurance for things like cars, houses, laptops, and the like. Some events are both unexpected and sometimes unavoidable. Some others happen as a result of sheer carelessness and could have been avoided. There should be a clause stipulating what happens in such events.

There is some degree of damage that the staff could be made to take responsibility for, and there are some others that the company may have to step in and bear the brunt. An insurance cover could also have a role to play in all of these.

Some agreements could allow the staff to take full possession of some of the assets after some time. For instance, it is possible to allow staff to lay claims to things like mobile phones and cars, after some years of having it in their possession. This could encourage proper maintenance of the assets.

Whatever you opt for, have it spelled out in black and white.