Fleet News

Insight: Salary sacrifice – why it's time for a closer look

However, engineering consultant WSP found that the overall benefits delivered by the scheme it established with Venson Automotive Solutions in April 2010 would spell the end of its own traditionally-run company car fleet.

Company car salary sacrifice schemes are at their financially most attractive when salary is substituted for a benefit that is taxed at a much lower rate – such as low emission company cars.

Consequently, London-headquartered WSP wanted a bespoke salary sacrifice scheme that would drive down its carbon footprint by encouraging staff to drive lower emissions cars for business purposes.

Venson subsequently tailored its WSP Advantage scheme according to these principles and, three years later, has so far supplied 200 cars.

Car fleet manager Dennis Dugen attributes its ongoing success to engaging employees at the earliest opportunity about the importance of reducing emissions.

He says: “The scheme is helping us achieve our economic and sustainability objectives as the funding structure encourages employees to choose low emission cars and cut their mileages.

"As well as delivering financial benefits to the company and employees, WSP Advantage is also benefiting the environment as vehicle emissions are reducing, along with the amount of miles driven, as employees are thinking how necessary both business and private journeys are before making them.”

Dugen adds that an additional benefit of the salary sacrifice scheme is that the company is no longer burdened with a vehicle if an employee leaves the company – as had previously been the case with its company car scheme.

In the public sector, Sherwood Forest Hospitals NHS Foundation Trust in Nottinghamshire became one of the first trusts in Britain to launch a salary sacrifice scheme in autumn 2009. Following an extensive tendering process, it opted for the Mycar salary sacrifice scheme from Leasedrive and, to date, 148 cars have been supplied – representing a take-up of between 3% and 5%.

Anne Burton, staff support and benefits co-ordinator for Sherwood Forest Hospitals NHS Foundation Trust, says: “We initially wanted to introduce an attractive benefit to staff from a recruitment and retention point of view, while endeavouring to reduce the health and safety risks for those employees using their own vehicles for work purposes.

“In addition we were keen to realise some environmental benefits through the car scheme.

“As a direct result of the scheme, our employees are making significant savings through sacrificing salary and our average CO2 emissions on the scheme are just 122g/km.

“The trust itself is also saving money in National Insurance and pension contributions for every employee that joins.

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