If an employment ends and there is financed hardware connected to that employee and the financial agreement has not expired, an admin can either move the device to another employee or terminate the financial agreement prematurely.
Below we discuss two different scenarios and how a company could proceed to deal with them. Consider the suggestions below as examples - it's up to every company to create a process that works for them.
Terminate product without salary deduction
If the device falls within the employee’s budget, an admin can assign the product to another employee without affecting either the employee or the financial contract. If your company offers the possibility to buy devices out and the leaving employee wants to buy the device, the contract will have to be terminated prematurely since a financing contract cannot be written on a private person. Check with your hardware supplier and leasing provider to get exact cost estimates for this.
If you want to terminate the contract prematurely, a "break fee" arises for early termination and a debt for the remaining rental period. This cost should reasonably be paid by the company as the equipment, based on budget, can be considered essential for the employee to be able to perform their job and should therefore not be charged to the employee who quits. You can read the article about salary deductions - benefit taxation for more information.
Terminate product with salary deduction
In the case where a product exceeds the budget and the employee pays part through salary deduction, there are two alternatives:
- The company pays the entire cost of early termination ("break fee" and remaining leasing), including the part that would have been paid by the employee.
- The company only takes the cost of early termination ("break fee" and remaining financing) up to the budget. The remaining financing cost that would have been paid by the employee is deducted from the final salary as a one time cost. If this alternative is preferable, your company should clearly inform your employee in advance that a possible debt may arise if the employment is terminated before the contract period has expired. Here, the company should also take a position on which procedure is followed based on whether the termination of employment is initiated by the employee or by the company.