When working in a business and your employer requires you to use your own vehicle for working purposes, you are then driving a grey fleet vehicle and your employer is responsible.
Grey fleet drivers, what are they?
Companies that use vehicles of their employees for business purposes are described as using grey fleet motors. As a result, a grey fleet driver may be someone who uses a vehicle that was purchased via an employee ownership scheme, gets behind the wheel of a privately rented vehicle or simply uses a vehicle that is privately owned by the employee themselves.
Employers are entirely responsible when using grey fleet vehicles. This also includes when fuel and other costs that the car owner might face are factored in. Normally, employers will also have to make sure they are using fleet management solutions to ensure drivers are driving carefully and following compliance regulations.
The legal stuff you need to know
Van lease specialists Northgate has looked into the idea of grey fleets, first by pointing out businesses must be familiar with the Health and Safety at Work etc Act 1974 if they are using grey fleet drivers. This is because the act underlines that it is the requirement of employers to ensure the health and safety of all employees while at work, so far as is reasonably practicable. It also stresses that employers and employees have a responsibility whenever they are engaging in work-related driving activities to ensure they are never putting others at risk.
If an employer was to have company cars for their employees, they have the same responsibility when using grey fleet vehicles to carry out working tasks.
ROSPA have created a guide on how to operate as a business with grey fleet vehicles. Not only does the system enable organisations to record details like driving licence validity, insurance details including business use, MOT certification and road tax validity, but once recorded it can alert each relevant individual driver and line manager of dates when any of these items are up for renewal.
What you need to know
In 2016, there were 14 million grey fleet vehicles on the roads in Britain, according to Lex Autolease. A report commissioned by the British Vehicle Rental and Leasing Association (BVRLA) titled Getting to grips with Grey Fleet has also suggested that employers across the nation are racking up a bill of around 5.5 billion each year to cover the grey fleet.
In the UK, there are 12 billion miles carried out every year by grey fleet drivers – this causes 3.5 million tonnes of CO2, according to the Energy Saving Trust.
“Worryingly, 22 per cent of fleet managers think there are no serious risks to the company from employees using their own cars for work. But driving is the most dangerous activity for most employees while at work, and 62 per cent of private car use is for work-related activity, so duty of care, regardless of the vehicle’s ownership, should be a top priority.” Commented John Webb from Lex Autolease.
With the help of employers and policymakers, the BVRLA set out to reduce mileage and costs by 50% by the year of 2020 in regards to the grey fleet.
Changing your ways
Are you part of a company that wants to reduce the number of grey fleet vehicles? There’s a number of alternatives available for you and your employees to consider…
A new scheme to encourage changes
Salary sacrifices could be presented for vehicles that are used for business purposes. This would work in that businesses would give employees the chance to relinquish a part of their salary and in return receive the non-cash benefit of a new lease vehicle.
“They … meet duty of care concerns and, by introducing mandatory licence checking and automatically providing business insurance, the schemes ensure that the company and its employees are fully covered.” David Hosking, the CEO of salary sacrifice market leaders Tusker, commented.
Using rental cars as a business
Renting vehicles could be a good and flexible solution to replace grey fleets for business travel. This last point is underlined by the fact that vehicles can be delivered for the company to use for as little as an hour at a time or for a month or more. If this does become an option for your business, you will be able to track and monitor different aspects of vehicle usage which could be beneficial as you will be able to allocate employees and costs more efficiently.
Using company cars
Lowering business mileage usage so that employees can use company cars could be a way to reduce grey fleet vehicles.
“This means that the business has more control, or at least some say, over the car that drivers have,” pointed out Lex Autolease’s John Webb.
However, Jon Burdekin, from Alphabet, stated: “I wouldn’t say it is necessarily the most strategic way to manage your grey fleet. If you’ve got somebody who’s doing 10,000 business miles a year in their own car, then there is an argument to say they should have a company car because they are more than an occasional user. However, I wouldn’t say increasing the company car fleet is right. It is an option, of course. You can give every single employee a car, but it’s using a sledgehammer to crack a nut.”