Work + Theft + Insurance = ?

March 18, 2005 11:51 AM

An associate, while returning from a work site after 5 p.m. and was on a personal errand, had his car broken into and along with personal items, his work laptop was stolen. His homeowner's insurance covered his personal items, but obviously would not cover his work owned laptop. His employer, on the other hand, is demanding that he pay for the cost of the laptop (a 3 year old Dell bought for approximately $700, which they consider to be worth $590). He works for a fairly large non-profit located in Maryland. The laptop was purchased with a technical grant, which I expect would have demanded insurance. And he doesn't believe that he signed anything that would have made him liable. What are his rights?
posted by Heatwole to Work & Money (18 answers total)

Why isn't the homeowner's insurance covering this? It is not so obvious to me. Since he appears to be responsible for the laptop it was a loss to him regardless of who had title to the computer and therefore the insurance company should cover it as well.
posted by caddis at 12:17 PM on March 18, 2005

IANAL, but I'd be surpised if, with him not having signed anything acceptingly liability, he could be held liable. Especially if he can prove that his car was broken into, which I'm assuming he can (otherwise how to prove he didn't just take the laptop for himself?).

If his employer didn't have insurance on their computers covering theft, they're idiots, plain and simple. That's just basic, and is something you should do for desktops, but, for obvious reasons, especially for laptops.

I'm also wondering whether or not his auto insurance (assuming he had theft/comprehensive coverage) would cover the laptop. But it should really be covered by his employer, and I can't see how he could reasonably be held liable for it.

Again, IANAL.
posted by cerebus19 at 12:25 PM on March 18, 2005

Whew! I usually don't make that many typos. Sorry about that. That's "surprised" and "accepting liability."
posted by cerebus19 at 12:26 PM on March 18, 2005

Regardless of where the liability lies, to appraise that liability at $590 on a 3-year-old Dell is obscene.
posted by IshmaelGraves at 12:34 PM on March 18, 2005

Uh, it's the employer damn fault. If they didn't want to take a chance that this could happen, they should have bought a desktop computer. I dropped by employer's laptop once and my employer's insurance paid for it. Yeah there might have been a higher premium but that's how it goes. If I were the friend and I didn't mind taking the chance, I'd tell the employer to jump off a cliff; it's the damn cost of business. Next, they'll suggest he pay for loss of value on his computer since he was the one who "used" it for three years!
posted by pwb503 at 12:52 PM on March 18, 2005

I also find it hard to believe the company does not insure their products. I would doublecheck this through HR.
posted by xammerboy at 12:53 PM on March 18, 2005

Why was his work computer in the car? Was he allowed to remove it from his work site? If so, his employer can't really say shit.
posted by mischief at 12:56 PM on March 18, 2005

he certainly has the right to look for a better employer...
posted by andrew cooke at 1:02 PM on March 18, 2005

A video professor of mine had her house broken into and her camera stolen. Becuase the University had purchased the camera for her, her insurance company did not want to pay. She argued that because the equipment was purchased for her, she was the owner. She noted that if a family member had purchased the equipment for her as a gift, insurance would cover it. The insurance company paid for it in the end.

I'm not sure if this applies, the company can't say it gave the computer to him and then ask him to pay for it, but it shows that sometimes insurance companies say no initially and pay anyway.
posted by spaghetti at 1:14 PM on March 18, 2005

I doubt he has any legal obligation to pay back his employer unless he signed something. I know for a fact that's the case where I work. That doesn't mean that his employer can't make his continued employment very painful if this doesn't happen.
posted by substrate at 1:32 PM on March 18, 2005

He may not have any legal obligation but he likely is also an at-will employee and they can decide to can him if he doesn't play along.

I wish you'd tell us who the nonProfit is so the rest of us in the DC area can make sure not to work for such a nutbag operation....
posted by phearlez at 2:03 PM on March 18, 2005

The company's valuation of a 3-year old computer is indeed absurd. Where I used to work (a major non-profit in NYC), we had a devaluation scheme whereby any computer 3 years old or older was officially valued at $0 and was automatically taken off of the inventory. Most of our machines were Dells.
posted by mds35 at 2:25 PM on March 18, 2005

Maybe he should get a three-year old Dell off ebay or craigslist. I reckon it'd be pretty cheap.
posted by anapestic at 3:09 PM on March 18, 2005

phearlez, I'd be happy to do that through email, but I didn't see yours in your profile. Mine is.
And to everyone else thanks for the answers, please keep your opinions coming, this is FUBAR.
posted by Heatwole at 3:09 PM on March 18, 2005

Thought the accounting depreciation of a computer was 5 years?
posted by thomcatspike at 3:42 PM on March 18, 2005

If the organization is the owner of the laptop, then it is their responsibility to insure it. I suspect that they don't want to go through their insurance company because they know they won't get any money out of them, and they're hoping they can get your friend to cover their asses.

He should definitely ask how they determined the value of the laptop, because if they are reporting that computer as a $500 asset then they've got really big problems with their books, and if they've fully depreciated it then they've got a lot of nerve asking him to pay $500 for it.
posted by stefanie at 4:19 PM on March 18, 2005

1) No way do their tax records claim its current valuation at $590. Thanks to certain generous post 9/11 depreciation write-offs, they may well have already depreciated it down to $0. *snort*

2) No way is its Fair Market Value $590. (on the other hand, from a business perspective, the stolen data could be priceless to the company--so more shame on them if they're handing out laptops without insuring against major losses much less the relatively trivial loss of the hardware itself)

3) Tell them nicely to take it up with their insurer or else write it off their taxes as a business loss. Period.

4) If they persist in demanding payment, immediately find a better employer and consider yourself lucky to have found out about this "our managers' fuckups are our employees' liability" rule before getting stuck with something deeply messier. (If you're worried about keeping up enough good will for the job reference, find a comparable model on eBay and maybe* offer to pitch in half the replacement model's cost. What's that, maybe $100?)

[* BEWARE. Sometimes making a goodwill offer is enough for a lawyer to twist into an admission of liability. This is where official legal advice would be a Very Good Idea.)

5) If they really want to be dicks about it, I guess they could keep on pursuing it. But that's just small claims court territory. They'd be better off taking your $100 than bothering with the hassle and filing fees. Especially since--even if you're found liable--it should be easy to prove their valuation is a crock.

If there's any hint of attempt to dock a paycheck, call a lawyer immediately. IANAL, but I doubt they'd have the right to seize payment on a "debt" without having first earned a legal judgment that the debt exists.

By the way, when you've got a pretty straightforward legal question, it's amazing how fast you can get useful info by just calling a few lawyers from the local phone book. Answering basic questions for free, or even giving free 30 minute consults, is a common way to sniff out potential new cases. So usually you can find some attorney who's willing to give your friend some free basic advice.
posted by nakedcodemonkey at 4:56 PM on March 18, 2005

Does your associate really want to make this a legal case? Large non-profit organizations usually have processes that must be followed to terminate someone, but at the end of the day, your associate probably can be terminated simply because his manager so decides, perhaps after a few months of documenting "unsatisfactory performance".

As pointed out by others, a 3-year old computer isn't worth 80+% of its original value - probably 30 to 40 percent is more accurate. So, at minimum, he could find a closed ebay auction where a similar model was sold, point that out as being a more reasonable valuation, and offer to pay that amount (i.e., $200 to $300). Or he could offer to BUY a similar three-year old Dell and give that computer to the organization.

Finally, in the post, it is stated that "his employer" is demanding payment of $590. In my experience, organizations don't have vocal cords. So it's important to know who is actually saying these words - his immediate supervisor? the head of the information services department? Has this policy been confirmed, say, by Human Resources (Personnel)? In any case, he really should exhaust all internal (administrative) options before he talks to a lawyer, if he does at all, given the very small sum involved.

And if he's well and truly living from paycheck to paycheck, then should consider (if he does decide to pay) that the organization probably will be agreeable to repayment schedule - say, $25 or $50 per month for 12 or 6 months.
posted by WestCoaster at 12:47 PM on March 19, 2005