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TexLaw, Lawyer
Category: Employment Law
Satisfied Customers: 4430
Experience:  Contracts, Wrongful termination and discrimination
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Our Florida based company has had to let go an employee in

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Our Florida based company has had to let go an employee in Texas due to cause. The employee has a company vehicle and he did sign our vehicle policy stating that upon separation from the company that he would not receive his final salary/expense payment until the car was returned. Because of financial troubles, he is asking that we pay him before he returns the car to the company. We are trying to help but we understand that we will have no leverage for the timely return of our vehicle if we pay him. What language in a simple agreement can we have him sign stating that he promises to return our vehicle and that he is responsible for any damage to the vehicle as he will no longer be insured? Any other suggestions?

Thanks for your question.

From a legal standpoint, I would caution against giving up this sort of leverage. You fired this employee for cause, so he should return the vehicle as originally agreed. Second of all, he needs to remain insured. If he wrecks the vehicle, even with an agreement, the company will still be responsible for any injuries to third parties. If there is any way, you need to make sure that he either obtains his own insurance or stays insured under the company's insurance policy.

However, I understand wanting to be lenient.

The agreement you have already obligates him to return the vehicle, but I'm assuming from your question does not require that he be personally liable for any damages to the vehicle. The language I would recommend would be:

Whereas employer provided employee with a vehicle which is the property of the employer and has the the following VIN _______________________ (hereinafter "the vehicle").

Whereas employee has already entered into a written agreement to return the vehicle to employer.

Whereas employee has agreed that he shall not be paid his final salary and expense reimbursements until he returns the vehicle.

In consideration of employer's agreement to pay employee his final salary and expense reimbursement prior to employee returning the vehicle, employee agrees to the following:

1. Employee shall return the vehicle by _______________ (date). Employee shall return the vehicle to _____________________(address for return).

2. Employee shall be responsible for all expenses related to the vehicle.

3. Employee shall be responsible for any and all damage to the vehicle which is incurred from the date of the execution of this agreement to the date he returns the vehicle to employer.

4. Employee understands that employer's insurance shall no longer cover employee on the vehicle and employee will have to procure his own insurance.

5. Employee indemnifies employer from any and all claims, damages,and/or lawsuits related to or otherwise arising from the vehicle, or employee's use of the vehicle, whether employee was negligent or not, including injuries or claims from any and all third parties and employee.

6. Should Employee fail to return the vehicle by the date specified above, Employer shall have the right to use self-help to remove the vehicle from Employee's possession, including any and all repossession procedures allowed by law. Employee shall be liable to Employer for any and all costs incurred or otherwise related to repossession or self-help.

Agreed to by:

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Best Regards,

TexLaw and 3 other Employment Law Specialists are ready to help you