Uniforms, Tools and Equipment: Do I Have to Pay for That?

Legal

By Rebecca Morris
 
Because employers face significant costs to purchase, maintain, and replace uniforms, tools, and equipment, it's no surprise that some employers wonder whether they can shift these costs to employees. 
 
Two federal laws, the Fair Labor Standards Act and the Occupational Safety & Health Act address whether employers can require employees to pay for uniforms, tools, and safety equipment. Additionally, many states laws cover these pay requirements. You must make sure you understand and comply with all applicable federal and state rules.
Here are some answers to frequently asked questions about paying for uniforms, tools and equipment.
 
Q: We require employees to purchase company uniforms that have our logo on them. Is the company required to reimburse employees for these?
 
A: Several states require employers to pay for the full cost of required uniforms as well as the cost to maintain them. In these states, you must pay for the uniforms upfront or reimburse employees the full amount. Absent a state requirement, if you require the employee pay for uniforms, the cost may not reduce their pay below the minimum wage or cut into overtime pay.
 
Note: Under FLSA and many state laws, employers are generally required to obtain an employee's consent before making a deduction from pay. The agreement must specify the item(s) for which deductions will be made and how the amount of the deduction will be determined. It is a best practice to obtain the employee's authorization in writing and consult legal counsel before making this type of deduction.
 
Q: I have an employee who earns $9 per hour and works 40 hours per week. A set of uniforms is $200. If I deduct the full amount in one paycheck, it would reduce the employee's pay below the minimum wage. Can I prorate the cost of uniforms over more than one pay period?
 
A: Under FLSA, provided the deductions never reduce the employee's pay below the applicable minimum wage, you may prorate the cost of uniforms over more than one pay period. However, this practice is prohibited in some states, so check your state law. Assuming the federal minimum wage of $7.25 applies, in this particular example, the maximum amount you could deduct in a workweek is $70.
 
Q: Do I have to pay for the cost of cleaning employees' uniforms?
 
A: Under FLSA, if the employer pays the cost of laundering, ironing, dry cleaning, or any other special care of uniforms, the employer is permitted to deduct these costs from non-exempt employees' pay. However, the deductions may not reduce their pay below the minimum wage or cut into their overtime pay. If these costs dip employees' pay below the minimum wage or impact overtime pay, the employer must reimburse employees to make up for the shortfall. Under FLSA, there is an exception to this requirement for "wash and wear" uniforms that can be laundered with other personal garments. In such cases, no reimbursement would be required under FLSA.
 
Note: Some states require employers to bear the full cost of laundering uniforms, except when they need only machine washing and drying, so check your state law for compliance.
 
Q: Our company is a restaurant with tipped employees. Can we require employees to give us a portion of their tips to cover the cost of dry cleaning uniforms?

A: No. Under FLSA, no portion of an employee's tips may be kicked back to the employer to cover the cost of a uniform or laundering.
 
Q: My employees are required to use certain safety equipment. Do I have to pay for required safety gear?

A: Generally, employers must pay the full costs of personal protective equipment (PPE) required under OSH Act regulations. Employers must also pay for replacement PPE used to comply with the regulations. However, when an employee has lost or intentionally damaged PPE, the employer is not required to pay for its replacement (although, FLSA rules pertaining to deductions still apply and state laws may also have restrictions). 
 
Q: Do I have to pay employees for the time spent putting on and taking off required work gear?

A: If the gear is required by law, the employer, or the nature of the work, then the time an employee spends putting on and taking off gear on the employer's premises generally must be paid. The time must be paid only when the employer or the nature of the job mandates that it take place on the employer's premises. If employees have the option and ability to change at home, there is no requirement for the time to be paid, even if workers choose to change at work, according to the U.S. Department of Labor.
 
Q: Do I have to pay for tools and equipment that employees need on the job?

A: Some states require employers to pay for the full cost of required tools and equipment.* In these states, you would either have to pay for the tools upfront or reimburse employees. If there is no state requirement to pay for tools and equipment, then you must make sure any cost the employee bears does not reduce their pay below the minimum wage or cut into overtime pay.
 
*Note: Some states make exceptions for certain types of tools or equipment, such as tools and equipment customarily required by the employee’s trade. Check your state law for more information.
 
Q: How do these rules apply to employees classified as exempt from overtime?

A: Employers are prohibited from making deductions from exempt employees’ salaries for uniforms, tools, and equipment. If these deductions are made or employees are required to incur these costs without reimbursement, it may result in the loss of the overtime exemption.
 
Q: An employee resigned and has failed to return company equipment. Can I deduct from their final pay?

A: For non-exempt employees, the FLSA permits employers to make deductions from employees' pay for lost/stolen/unreturned equipment provided it does not reduce the employee's pay below the minimum wage and does not cut into any overtime pay. However, some states prohibit this practice or have additional requirements, such as requiring prior written consent, so check your state law before making a deduction. The FLSA does not permit this type of deduction from exempt employees' pay.

Additional Resources
www.dol.gov/whd/flsa
www.osha.gov/law-regs.html 
 
Rebecca Morris, SPHR-CA, SHRM-SCP, serves as Content Development Manager for ADP.