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An employee equipment agreement is a legally binding document between an employer and an employee regarding the use of company-owned equipment. It specifies the company's expectations for the employee's care of the equipment. The video discusses employee permissions and responsibilities, emphasizing that employees must maintain their equipment and return it upon leaving the company. The agreement includes policies on taking equipment off company premises to various locations. Additionally, it identifies common office equipment that falls under this agreement, ensuring that both the employer's and employee's rights and responsibilities are clearly defined.