Employees occasionally leave behind personal property following termination of employment. Whether it is discovered immediately or long after the employee has departed, many Alberta employers would be surprised to learn that they have certain obligations to that former employee with respect to the treatment of the personal property.
The Unclaimed Personal Property and Vested Property Act (the “Act”) applies to Alberta employers with respect to most tangible and intangible personal property worth more than $1,000.00 or $250.00, respectively. Intangible property is defined in the Act as any interest held, issued or owing by a business, government or government institution, and includes items such as money, cheques, securities, dividends and bonds. Tangible property is defined in the Act as anything that is not intangible property. Generally, however, tangible property is physical property such as an employee’s personal belongings, equipment or tools.
If an employee leaves behind property meeting the definitions found in the Act, employers must store the property for 5 years, notify the individual in a prescribed form and at a prescribed time, and then, if it remains unclaimed, deliver that property to the Minister of Finance. The employer also has to retain all records relating to the property for a period of 10 years following delivery.
If the total of the unclaimed tangible property left behind is worth less than $1,000.00, then the common law will likely apply. Under those circumstances, an employer is typically required to retain the property for a reasonable period of time before it is deemed to have been abandoned by its owner, and could then be sold or otherwise disposed. In such circumstances, should an owner object and bring an action to recover its converted property, the court would consider four factors: the passage of time, the nature of the transaction, the owner’s conduct, and the nature and value of the property.
We recommend that Alberta employers implement a written policy to deal with employees’ personal property to restrict the instances of personal property being left at work, to ensure compliance with all requirements under the Act and the common law, and to ensure that the chain of documentation regarding property left with the employer is complete and accurate. In particular, such a policy could:
- Restrict employees from bringing unnecessary personal property to work, particularly high value property;
- Require employees to obtain permission prior to bringing higher valued personal property valued to work;
- Require employees to take all personal property with them following termination of employment. Implement a supervision, checklist or packing process to ensure property is removed on departure;
- Identify when property valued at less than $1,000.00 and not governed by other applicable legislation will be deemed abandoned;
- Notify employees that the employer may impose a charge for any costs associated with storage or valuation of personal property left behind, for the cost of providing notice, and any for costs associated with the payment, transfer or delivery of personal property to the Ministry if required under the Act;
- Implement a regime for contacting a former employee regarding his/her property and properly documenting all attempts and any successful contact. Efforts should commence immediately and be documented (time/date/method/who). Sending a recorded letter may provide additional proof of both best efforts on the part of the employer, and that the former employee has been receiving the information about his/her property, and
- Provide a methodology for properly documenting the chain of custody of the personal property (including where it is being stored and any expenses that are being incurred for storage).
By Benjamin Aberant and Shana Wolch
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