What grinds my gears: Companies destroying test gear...

[Thilo78]

...rather than giving it away to hobbyists and students.

Recently, I had a lengthy discussion regarding discarded test gear (scopes, multimeters etc.) and why companies refuse to give it away or sell it to employees.

Apparently, there is an interpretation of German product safety laws, that considers the companies to be responsible for any incident happening after they sold the gear.
Thus, in order to avoid being sued, they destroy the gear prior to throwing it in the trash.
Inquiries to buy single units are strictly refused.

Of course, they also refuse to make a written agreement with the buyer, that could potentially release them from responsibility.

I have no idea, how much good equipment is dumped in the process. And I also don't know how much vintage (=worth restoring, at least for historical purposes) gear is in this part.

This kind of drives me mad, being the technophile I am.
What did you experience in this respect?

[dr.diesel]

At one of the companies I worked for, someone filed a grievance that he didn't get the chance to buy what someone else did.  Caused a big issue and demanded an auction site, which costs money and employee dedication, so they ended up just trashing everything.

[Kjelt]

We could buy old used test equipment for low prices (think 10-20 euros), although there was a huge list of interested employees so in practice you get one power supply in three years or so.
If you left the company you got put on top of the list, so I got a nice Fluke/Philips digital oscilloscope 12 years back, no probes though, those could be re-used for the workplace.
If you worked closer to the fire you got more lucky. If your own testequipment failed and repair was too expensive you could take it home for a pie. That kind if stuff.
In practice there were some outrageously things going on, factory closes and one person ends up with 5 digital power supplies 0-300V 0-5A costing €4000 new, ending up on ebay kind of places a week later for €1000 a piece. That stinks and I really hate.

But in respect to the safety laws there were some unwritten rules for instance high voltage (kV's) dc powersupplies were not sold due to safety issues. And some testequipment were only sold to registered EE's because a layman could well injure himself. Kinda you do not sell chainsaws to underaged persons kind of stuff.

[1xrtt]

I worked on the brazilian subsidiary of a (once) huge telecom vendor, I lost count of how many times I saw this happen.
YMMV, but in this case, It's all bureaucreacy. From the company standpoint was simpler to pay a third party  to get the equipment away and provide a paper confirming they were properly scrapped and disposed. So the bureaucrats could happily scratch that passive out of the company inventory.
Most of that was surplus that was imported into the country but not sold. And I was not alone with that feeling. A colleague managed to build the one largest lab out of the headquarters, just by scavenging equipment about to be scrapped. Telecom switches, LAN switches, PBX, Cisco routers, Sun workstations, HP/Dell servers,  we even had sales team conducting proof of concepts with customers, using those leftovers.
My last try was back in 2009, when the mother company was in Chapter 11 and we all knew what will be the outcome. I made an offer for a couple of racks of equipment by the time I was let go and was told that it is just too costly to manage "individual sells". One month later, the brazilian subsidiary closed down and, although the bankuptcy process is now done, nobody I talk to knows what happened to over 200 sq meter of equipment racks. Probably still in storage some place else.

[m100]

We never scrapped test kit in the first instance, we always offered it for internal sale.   We used to have internal sealed bid system for surplus equipment of all types, test gear to heavy goods vehicles.  Worked well for many years and you could pick up some quite good bargains.   Most of the bidding activity wasn't with test gear but with cars that might only be two or three years old and while some were shagged out and stinking of tobacco some were in near showroom conditon.

There was a huge stink when some arsehole in 'accounts' that were tasked with administering the system gave someone an authorisation to take off site test equipment at somewhere around 1% of it's new value even though there was a week or two to run and offers of in excess of ten times that were either already in the internal mail or sat on their desk in accounts waiting to be formally opened at the end of the offer period.  What was even more galling was the bid end date was timed for the arrival of already ordered new replacement equipment. So as the old kit was taken off site part of the department just ceased working for a couple of weeks.  Protests at the highest level were ignored.   

Another tale of unlimited fuckups.  After an extensive evaluation process that lasted weeks, and despite three competitive tenders the same silly twat in accounts also changed a huge order for laptops so the colour TFT screen ones that were essential were replaced with 'better value ones' with a mono screen.   If he hadn't had a crippled leg there are a few of us in engineering that would have busted the other one      It cost us tens of thousands in restocking fees to get the ones that were required even though they were all sent back to the vendors in sealed boxes.   

[CatalinaWOW]

In any large organization there are numerous factors.  Costs to administer the program.  Legal liability.  Costs to investigate liability.  Sales taxes.  Value of employee satisfaction.  The list goes on and on.  No one really knows the answers.  Many of the upside factors are fuzzy and hard to evaluate.  The downside answers are often low probability, but really huge. So the final answer isn't rational because no one can get meaningful data.  The answer is based on the personal values of the highest power person who gets in on the decision.

[borjam]

I remember when more than 20 years ago the Physics department replaced the ancient Telequipment oscilloscopes with brand new shiny Tektronix ones They aligned all the old stuff at the corridor, and, if I remember well, they told everyone that everything would be scrapped in a week, free to grab before the deadline.

Shame on me I didn't go to class that day. Of course the oscilloscopes (most of them in good working order) were gone in a matter of minutes.

[TassiloH]

Partly it is the miracle of EU consumer protection law:

• If they sell it as functioning test gear to the public, and the buyer is a person and not a company, they have to give warranty. There are different time periods involved regarding who has to prove that the cause of a defect was already there at the time of the sale, but practically this is a 6 months warranty. It is not possible to exclude this warranty for used goods by contract if the buyer is a consumer, period.
• If they declare it as broken it is questionable if it can be sold to a end user, that might be illegal disposing of trash (keep in mind, even our local scrap metal dealers are NOT allowed anymore to collect household appliances).
• If they sell it for cheap to their employees and don't make the offer publicly available, the tax department could interpret that as a form of wages and demand tax for the monetary advantage that the employee gains.

A long time ago I wanted to buy some used equipment as an empolyee, and because of all these difficulties formally my mom's business had to purchase it officially (and then just give it to me).

[Mechanical Menace]

Partly it is the miracle of EU consumer protection law:

...snip...

My current employer has a habit of loudly proclaiming "Oh dear, the cameras in the waste room aren't working, the key for the door has been lost, and the disposal company aren't here until Wednesday. I do hope nothing goes walkies."

Somehow an industrial computer, a bunch of servos, and lots of aluminium extrusion found their way to my place

[German_EE]

Similar to my approach. When scrapping useful stuff I used to find out who was interested then walk with them to the skip. The product concerned (labelled as scrap) was then carefully placed in the skip without damaging it and I then walked away. What happened then? No idea 

[CatalinaWOW]

Sounds like an opportunity for a maker group, radio club, robot club or whatever to form a company, call it Equipment Home.  That presumably gets around the consumer protection aspect of the laws.  Equipment Home can purchase gear from various companies that need to unload this type of equipment.  The purchase price could be extremely low, since the alternative for the sourcing companies would be to pay disposal fees.  Equipment Home can then have periodic demonstrations.  Might even be able to charge a fee for admission to cover the costs of putting on such an event.  Unfortunately things just seem to disappear each time one of these demonstrations happens.  Can't imagine why that would happen. 

Of course there would be some stuff that just never seems to disappear.  The admission fees and any other sources of income would have to cover the cost of disposal as well as storage, transportation and other costs of putting on the demonstrations.

[station240]

Sounds like an opportunity for a maker group, radio club, robot club or whatever to form a company, call it Equipment Home.  That presumably gets around the consumer protection aspect of the laws.  Equipment Home can purchase gear from various companies that need to unload this type of equipment.  The purchase price could be extremely low, since the alternative for the sourcing companies would be to pay disposal fees.

Most maker spaces don't have enough space to store anything really. I have no idea why those that down lease/own large store rooms don't do things with surplus test gear.
A certain group lead by one Bowden for instance take in old computers to reuse, most get scrapped, some used in projects, some sold.

the EU's eWaste laws, that relate to disposing of equipment make a joke of the first part of recycling, the reuse part. Really should be a way of signing off equipment as "disposed of: reuse" so all the accountants/lawyers are happy.

[Zero999]

I've never encountered this myself. I've been lucky to have been given lots of old test equipment from work for free.

I can understand why a company might not want to sell it though. Typically companies have to give some sort of guarantee, when they sell something which they don't want to be liable for. As far as safety is concerned, it shouldn't be a problem as long as it has a PAT (Portable Appliance Test) certificate, which all UK businesses have to have for anything with a UK mains plug.

[dannyf]

"Apparently, there is an interpretation of German product safety laws, that considers the companies to be responsible for any incident happening after they sold the gear."

The cost of having the government protecting the people from themselves.

[eugenenine]

Its the same anywhere, the grocery store I worked at while in college had to destroy groceries otherwise the employees would "drop" stuff on the floor so it had to be trashed then pick the trash after their shift.

[Lightages]

I was at IBM Fishkill in the mid nineties. While I was commissioning a piece of equipment there I saw big carts with piles of equipment in the hallways. Every piece of equipment had a series of five different colored adhesive dots on them. I asked one of the employees what was going on with all this equipment in the hallways.

He told me that all the equipment was at the end of its tax write off life and therefore it had to be destroyed so as to not cause a tax problem for IBM. Some of the equipment was only five years old or so. The next day as I arrived through the back entrance near the loading docks I saw a sight that made me almost want to cry. There was a sheriff standing beside an industrial crusher/compacter. He had a clip board in hand and was marking off serial numbers of equipment as it was being thrown in and crushed. This is necessary in the US so the companies don't have to pay taxes on capitol equipment. If they try to re-sell it or give it away it regains value and their tax deductions on the capitol equipment can be reversed.

When I looked at the piles of equipment, oscilloscopes, power supplies of all types, high powered RF equipment, measuring equipment of all types, you name it they had it, it added up roughly to over 5 million dollars. I saw all of this destroyed in a few days as if it was all garbage.

The world is inside out and the only ones who are happy about it are the ones who wrote the rules to make it this way, and those who gain from this craziness at the expense of the majority who have no real say.

[Brumby]

I was at IBM Fishkill in the mid nineties. While I was commissioning a piece of equipment there I saw big carts with piles of equipment in the hallways. Every piece of equipment had a series of five different colored adhesive dots on them. I asked one of the employees what was going on with all this equipment in the hallways.

He told me that all the equipment was at the end of its tax write off life and therefore it had to be destroyed so as to not cause a tax problem for IBM. Some of the equipment was only five years old or so. The next day as I arrived through the back entrance near the loading docks I saw a sight that made me almost want to cry. There was a sheriff standing beside an industrial crusher/compacter. He had a clip board in hand and was marking off serial numbers of equipment as it was being thrown in and crushed. This is necessary in the US so the companies don't have to pay taxes on capitol equipment. If they try to re-sell it or give it away it regains value and their tax deductions on the capitol equipment can be reversed.

When I looked at the piles of equipment, oscilloscopes, power supplies of all types, high powered RF equipment, measuring equipment of all types, you name it they had it, it added up roughly to over 5 million dollars. I saw all of this destroyed in a few days as if it was all garbage.

The world is inside out and the only one's who are happy about it are the one's who wrote the rules to make it this way, and those who gain from this craziness at the expense of the majority who have no real say.

I had my own little tale to tell - but that one trumps it ten times over.... and then some.

[TerraHertz]

I had my own little tale to tell - but that one trumps it ten times over.... and then some.

Don't let that stop you. Make this thread a record of these crimes. Because they are definitely crimes. Hopefully one day (after the revolution, ha) the laws will identify such willful, stupid destructiveness as a criminal act. In fact this would be a good litmus test by which to judge any new regime.

Some of my experiences are here:
https://www.eevblog.com/forum/reviews/extreme-teardown-pr0n-$100k-server/msg881109/#msg881109
https://www.eevblog.com/forum/reviews/extreme-teardown-pr0n-$100k-server/msg881750/#msg881750

[CatalinaWOW]

The horrible thing is that fixing these cases makes other things worse.  Eliminate the depreciation tax credits so that no one will care if the equipment is destroyed?  Think how many decades it will be before the corporation decides to update the equipment in your lab.  Eliminate the careful checking to see that depreciated equipment is destroyed?  After your taxes have increased to cover the corporate deduction, the corporation will sell the equipment at actual market value.  The corporation will actually recover more than the cost of the equipment between tax write-offs and the sales price and all you have to show for it is your tax bill.  Well you also get to play with the pretty equipment while the corporation depreciates it.

[Kjelt]

I don't understand that american tax law at all, maybe someone can explain it?  .
Here in the Netherlands when a company buys a product it can settle the salestax with the tax they collect from selling stuff in the same bookyear.
Then they can write off the investment usually in three to five years. What happens is that on the balancesheet the investment that is on the assets side is reduced each year with the same amount till it is 0.
That has nothing to do with taxes and the asset is 0 at the end, it can be sold then that is income or destroyed but why in hell would the serialnumber have to be registered and an official present? I really do not understand any of this unless your government paid for the equipment in the first place.

[Delta]

At my local council dump - sorry, "recycling centre" - they have a large container for TVs and computer equipment.  The items dumped range from vintage CRTs to modern flat screens probably just needing a few new caps in the PSU.

I approached one of the guys there to ask about recovering some stuff for repair (the council's slogan is "Towards zero waste") only to be told that they're not allowed to let anyone take anything from that container, as the council have a contract with a WEEE firm.   The council actually PAY this company to collect stuff that still has genuine value!  The guy also made the international sign language gesture for "backhanders" ("kickbacks" I believe they say in the US)...

It stinks.

[vodka]

The guy also made the international sign language gesture for "backhanders" ("kickbacks" I believe they say in the US)...

but i 'm sure that the guy doesn't make the "backhanders" gesture with a group of the gipsies, because the bribery charges him at hot.

[djacobow]

I don't understand that american tax law at all, maybe someone can explain it?  .

I'll try. It's not about sales tax. It's about corporate taxes.

When a company buys a piece of capital equipment, they are allowed to depreciate it. https://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/A-Brief-Overview-of-Depreciation

That means that each year, the piece of gear loses value as it ages. That loss of value can legally be treated as an expense by the company, reducing the net income on which it pays taxes. Rather than tying depreciation to some assessment of the real value of the gear, which would be complicated and not easy to predict (some gear gets worthless fast, some slowly, some never, some gets more valuable, etc) they use a specified formula. It depends on the category of the investment and its "useful life", but basically, at the end of 4 or 5 or however many years the value of the equipment is assumed to be 0. It is "fully depreciated." Over those years, the company has claimed that depreciation as an expense and as a result, enjoyed reduced taxes.

Now, if that company were to turn around and sell the piece of gear, they would have income from tax-legally worthless gear and the IRS would say "whoa, you have fully depreciated this asset and we see now that this asset has value, therefore you owe us back some of the taxes that we did not collect!"

Companies like this system because it is simple and predictable. They get their tax writeoff over a few years and they're happy. The fact that Real Life is not quite like that and things do not magically become worthless at the specified time is just one of many, um, idiosyncrasies of the US tax system.

-- dave j

[borjam]

I'll try. It's not about sales tax. It's about corporate taxes.

When a company buys a piece of capital equipment, they are allowed to depreciate it. https://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/A-Brief-Overview-of-Depreciation

Of course, it's similar in many countries. However, it would be a good idea to grant an additional even if small write-off if, for example instrumentation was donated to educational institutions.

It's such a waste of natural resources to be scrapping all that perfectly useable machinery..

[Kjelt]

Thanks 

Now, if that company were to turn around and sell the piece of gear, they would have income from tax-legally worthless gear and the IRS would say "whoa, you have fully depreciated this asset and we see now that this asset has value, therefore you owe us back some of the taxes that we did not collect!"

But it is not illegal to keep on using that equipment inside the company after those years is it? It is written off so value 0 that is the same here.
But difference is that if they sell it for say $250 then that is new income for that fiscal year and they need to pay taxes over that amount of $250.
So actually the government gets more then if it is destroyed, or am I not making sense?