Cars owned by employees and funded partially or wholly by the employer through a car allowance
Schemes where the cash or salary alternative remains linked to a car through a supplement to salary or a discrete car allowance payment give the next-highest degree of control. Car allowances are the most commonly used form. The business has a lower degree of involvement and control than with company cars or ECO cars but can still set some limits on vehicles – such as maximum age or mileage.
Cars funded by employees through an adjustment to their salary in lieu of receiving a company car
Drivers who ‘cash out’ present particular risks. Their role may require them to make regular business trips in a car over which the employer no longer has close oversight. It is not impossible to assess and manage their at-work driving risks, but doing so is less straightforward than monitoring cars owned or closely-managed by the business.
Private car wholly funded by the employee
Around five million employees use their own car on business on an ad hoc basis. Even where business use is minimal, the employer remains liable for their safety while they are behind the wheel for work. Along with cars owned by former company car drivers who have ‘cashed out’ of benefit, this group of cars offers the lowest level of control and presents the highest risk.
Daily rental or pool car?
Pool cars have long been seen as an inefficient use of resources but, provided they are kept under close supervision, they offer a viable and probably preferable alternative to employees’ own cars for ad hoc use. Daily rental cars can offer a similar level of confidence about roadworthiness and fitness for purpose to company-owned or ECO cars.
Summary
All forms of business car use carry a degree of risk to both driver and employer but some are riskier than others. Company cars and structured alternatives such as ECO schemes provide employers with reasonable control over key safety factors while unstructured cash schemes dilute the employer’s degree of knowledge and influence without in any way diminishing the organisation’s responsibility.
Organisations need to minimise risk to themselves and to others and therefore they must consider the question of control every time they take a decision to offer a company car or another alternative.
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One Response
There are many different car
There are many different car schemes made available to employees depending on their individual needs in regards to private transportation. If they need a vehicle for work purposes, then the entire plan becomes a benefit but if they do not, then obviously it could be a burden to them in the long run. Companies need to ensure that the well-being of their employees get prioritized on top of everything else.