For those not in the know, this refers not to cars of a dull hue, but to driver-owned vehicles used on company business.
These present something of a risk management minefield, and one far too many fleets blunder blindly into.
Figures from Enterprise Rent-A-Car suggest nearly half of small to medium-sized businesses (46%) allow their employees to use their own cars for business.
According to the latest figures from the BVRLA, there are around 4,475,000 company vehicles in the UK, of which 2,125,000 are employee-owned.
Jim Kirkwood, managing director at risk management specialist DriveTech (UK), says: “The increasing number of privately-owned cars used on business trips is as a result of a rise in the popularity of cash alternatives to the company car and the introduction of personal contract purchase and Employee Car Ownership Schemes.”
“Numerous organisations allow staff to drive their own cars on business and operate company car cash alternative policies,” says ALD Automotive sales director Mel Dawson. “They are walking a health and safety tightrope.”
Grey fleet vehicles are not under the control of the company in the way that traditional company cars are.
But the company’s responsibilities to the driver – and therefore the vehicle – are the same.
Having employees zooming about in vehicles over which the company has no control could potentially have very nasty legal and financial consequences.
Solicitor David Faithful, of Lyons Davidson, says: “The issue of management of employees driving either cash-for-car or their own vehicles has become more defined since grey fleet was identified in the Health and Safety Executive’s guidelines to managing work-related road safety.
“These drivers have fallen outside the usual management measures introduced by fleets in respect of company cars and commercial vehicles.
This is primarily because the measures generally focus upon managing the vehicle itself, rather than upon the individual and their own self-managed vehicle.”
It is difficult to know how well grey fleet vehicles are looked after – whether they are serviced and generally kept up to the standard that one would expect from a company vehicle.
This can affect safety and efficiency and often means vehicles are more polluting than they need to be.
Financially, paying mileage expenses to employees who use their own vehicles can make a serious dent in a company’s bottom line.
If your employees are regularly on the road, mileage reimbursement becomes a major headache, according to Rob Ingram, UK business development manager at Enterprise Rent-A-Car.
“Sending employees out on the road can be dangerous and costly at the best of times, so the least employers can do is ensure their people are in well-maintained, modern cars,” he says.
ACTION NEEDED
“No matter how a vehicle is funded, if employees are driving for business purposes then the employer does have a responsibility enshrined in law for that driver’s welfare,” says Steve Johnson, of driver training company Drive & Survive.
One obvious way to avoid the issues is to use rental vehicles should non-company car drivers need to travel. But if that’s not an option, then action needs to be taken.
He adds: “You need to mandate that drivers provide you with evidence of adherence to vehicle manufacturers’ service schedules and you might even have to consider spot checks on such vital safety items as tyres, brakes, lights and wipers.
“Vehicles must be insured for business use and, if more than three years old, possess a valid MoT certificate, copies of which you will need to hold in the office.
“Vehicles also need to be fit for purpose but if you don’t issue any guidelines you cannot argue with the 25-year-old, who is expected to transport customers, from getting that MX-5 he’s always wanted.”
MINIMISE RISKS
Mr Johnson says grey fleet drivers treated the same way as the drivers of company-supplied vehicles will themselves benefit from cost savings.
By being subject to the same requirements concerning checks and servicing, they will see improved economy, reliability, better residual values and so on.
“You will also minimise the chances of a risk taker damaging your company’s reputation and good name,” adds Mr Johnson.
Should the worst happen, evidence of care taken over a grey fleet could reduce the risk of prosecution, according to Jason Francis, managing director of software and risk management firm Jaama.
“An audit trail of all vehicles driven on business and all staff taking to the wheel is crucial to safeguarding any company against possible prosecution in the event of a serious road traffic accident,” he says.
“With the Government, police and HSE united in a bid to reduce the annual toll of crashes involving at-work drivers, it is vital that all fleets can prove they have taken every possible action to ensure the safety of staff who drive on business.
“Many companies have moved away from traditional company cars, believing they have eliminated a health and safety headache. They haven’t.”
As Stewart Whyte, Association of Car Fleet Operators director, says: “It is established beyond doubt that if the employer commissions the journey, then the duty of care applies.”
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