Last reviewed 25 August 2020
For many people, the most dangerous thing they do at work is drive on the public highway. Gordon Tranter considers the importance of managing the use of employees’ own vehicles for business.
The grey fleet
“Grey fleet” is the term that refers to vehicles owned by employees that are used for making work-related journeys on behalf of their employer. It should be noted that cash opt-out cars are grey fleet, too. Employees receive additional salary, enabling them to acquire a vehicle as an alternative to a company car. This form of grey fleet may be a result of an active choice by drivers opting out of a company car, or by default in the absence of a structured company car scheme.
Following the move to working from home for many during the pandemic lockdown, a poll carried out by Fleet News showed 68.1% of respondents expected that working from home would become their “new normal”. Organisations will need to review contracts of employment if roles that were previously designated as office-based change to being officially home-based. In these cases, journeys into the office by car would no longer be classed as commuting but would most likely count as business mileage. For this use, the car would be classed as a grey fleet car and would need to be managed as part of the organisation's grey fleet.
It is estimated that there are approximately 14 million grey fleet cars in the UK compared with an estimated 900,000 company cars.
Of the 1870 fatalities and 25,950 serious injuries in the year ending June 2019, at least 31% fatal crashes and 26% serious injury crashes in Britain involve someone driving for work. This is likely to be an underestimate, as the purpose of a journey is not always recorded by the police at crash scenes. Consequently, even when accidents involving lorries are taken into account, a substantial number of these accidents will have involved grey fleet vehicles.
Businesses in which employees use their own car as part of their employment, eg care workers, engineers installing or maintaining plant or equipment, or workers attending meetings, visiting customers or delivering, all effectively operate a grey fleet. Unmanaged, the risks posed by such workplace activities can cost businesses dearly.
The importance of managing the grey fleet
Effective management of the grey fleet is crucial with respect to three key policy areas:
duty of care and health and safety
corporate environmental responsibility.
In addition failure to manage the use of employee's cars for work has the potential for the employer to be subject to serious legal action(s).
Duty of care
The fact that employees use their own private vehicles for business purposes does not release the company from its duty of care responsibilities. An organisation has a legal duty of care to an employee using a car for work, regardless of vehicle ownership. An employer is liable for prosecution and could also be subject to a claim for compensation.
The Health and Safety at Work, etc Act 1974 states that it shall be the duty of every employer to ensure, so far as is reasonably practicable, the health, safety and welfare at work of all employees, and that persons not in its employment who may be affected are not exposed to risks to their health or safety. So, if an employee falls asleep at the wheel on the way back after working a long distance away from their base, and injures a fellow road user, the employer as well as the driver could be held accountable for that accident. This is the case even when the driver is using their own vehicle.
Under the Corporate Manslaughter and Corporate Homicide Act 2007, organisations can be found guilty of corporate manslaughter where senior management can be proved to be responsible for a gross breach of their duty of care which causes the death of an employee driving for work. This can lead to an unlimited fine and a publicity order.
The Road Traffic Acts and the Road Vehicles (Construction and Use) Regulations are administered by the police and other agencies such as the Driver and Vehicle Standards Agency (DVSA) and apply to all vehicles in which business journeys are made. It is open to the police/Crown Prosecution Service/Procurator Fiscal in Scotland to prosecute employers of employees using their own car under “cause or permit”.. Examples of offences which can constitute an employer committing an offence under “cause or permit” include:
if an employer schedules a journey or gives any directions that it should be completed within a specific time and this results in an employee speeding, the employer may be liable for procuring the offence
an employer can be guilty of an offence if he causes or permits another to use a motor vehicle or trailer on the road when its condition, purpose for which its being used, number of passengers or weight, position or security of the load is such that it involves danger of injury to any person
causing or permitting another person to drive a motor vehicle without a licence.
Other offences include, causing or permitting another to use a vehicle while not insured, leaving a vehicle or trailer at rest on a road in such a position or condition that it involves danger to other road users, and causing or permitting another person to use a hand-held mobile phone while on the road.
Left unattended, the risks posed by employees using their own car for work purposes can cost businesses dearly. It is essential that there is a safe system of work for workers using their own car on company business.
The requirement on employers under the Management of Health and Safety at Work Regulations 1999 to carry out a risk assessment applies to grey fleet drivers in exactly the same way as to employees using owned or leased vehicles. The risk assessment is therefore the first step in preparing a safe system of work for managing the health and safety of journeys carried out by drivers driving their own vehicles. The risk assessment should consider whether the journey can be avoided and whether the need for the journey, or task, can be carried out equally well using video, audio-conferencing facilities, telephone or email. When the journey is necessary, the assessment should consider the following factors.
The driver, including a regular check on their licence and their fitness to drive which may include areas such as health, fatigue, eyesight and alcohol/drug (medicines and recreational) use.
The vehicle, including a regular check on whether it has an MOT certificate, has been serviced in line with manufacturers’ recommendations, and has the appropriate insurance. Studies show that employees’ own vehicles are typically older than company cars, less regularly serviced, emit higher levels of pollution and are incorrectly insured.
The journey, including the nature of the roads, bad weather, the schedule for the journey and whether it puts the driver under pressure to drive too fast for the conditions or to exceed speed limits, or if it is too long and has a risk of fatigue. Whether the journey can be carried out by foot, bicycle or public transport should be considered. Public transport is often a safer mode of transport than a car.
Communication with the driver while on the road, including arrangements that do not involve the use of hand-held phones while driving, as that is hazardous and against the law.
Whether there is a clearly defined responsibility for drivers using their own vehicles and who is in charge of managing it.
Standard car insurance is for “social, domestic and pleasure” purposes only, which permits travel to and from the normal place of work, but not the use of the vehicle while at work.
Employees who use their own vehicles for work-related purposes should ensure that their personal insurance policy states “for business use” to avoid invalidating their insurance. Even if the use is for convenience to travel to meetings or undertake similar work-related activities, the insurer should be informed that the vehicle will be used for “occasional business use”.
The ability to demonstrate the duty of care requirement has been met when it comes to the grey fleet, requires ensuring that the checks on the driver, the car, its insurance and the nature of the journeys are documented.
Road accidents, with a few specified exceptions, are not reportable under the Reporting of Injuries, Diseases and Dangerous Occurrences Regulations 2013. They are left to the police to investigate, and their focus is usually on driving standards and occasionally on employers for “aiding, abetting, counselling and procuring the commissioning of road traffic offences by employees” offences.
Employee-owned vehicles are typically older and therefore more damaging to the environment, contributing more to the organisation’s carbon footprint than other forms of transport, including company and daily rental cars.
Reducing grey fleet mileage
Studies have shown that there are significant costs and environmental benefits to cutting the miles claimed by employees using their own cars on business. This has led some companies to use a range of initiatives including the use of public transport or leased cars or hire cars, video conference facilities and the introduction of ultra-low emission pool cars and pool bicycles for staff to use on shorter business.
Although pool bicycle schemes require investment, this can be rapidly recouped through the savings generated. Other advantages are improved health, fitness and mental wellbeing, improved air quality and enhanced corporate social responsibility reputation. One of the greatest benefits of cycling is the speed and convenience when making short journeys.
Although, cycling can also be perceived as unattractive, despite the evidence that it is associated with improved health, fitness and mental wellbeing, improved air quality and enhanced corporate social responsibility reputation. One of the greatest benefits of cycling is the speed and convenience when making short journeys. However, there has been concern about recent fatalities associated with the cycling superhighways in London and the number of fatalities caused by blind spots on HGVs.
Although pool bicycle schemes require investment, it is claimed that it can be rapidly recouped through the savings generated.
It should not be forgotten that employers have a duty of care for employees cycling on work-related business either on pool bicycles or on their own bicycles. They should:
ensure a risk assessment is in place
ensure the bicycles are maintained regularly so that they are safe to ride and have the correct reflectors and front and rear lights
check that their employers’ insurance policy covers the use of bicycles for work purposes
ensure that their employees are competent to ride the bicycles.
Pool bicycles provided for work should be provided with panniers to carry work equipment and accessories such as helmets, wet weather clothing and lights. Any helmets, high visibility vests and protective clothing provided to employees who use pool bicycles for work purposes should be free.
The use of pool bicycles has to be optional, unless specified in the employee’s contract.
The financial perspective
Grey fleet vehicles can be the most cost-effective solution for an employee needing to make a short ad-hoc journey. It is often perceived as the easiest method of transport for both employers and employees. Employers gain the advantage of having a readily mobile workforce without incurring the capital expenditure and ongoing costs of sourcing a business fleet of vehicles.
However, for longer and more regular journeys, alternative options could prove to be more cost effective and a lower risk. For certain types of journeys, using a grey fleet car is an expensive option, for example if an employee drives more than 80 miles in a day. Daily rental is a cost-effective alternative for longer trips and also addresses health and safety and environmental concerns related to the use of a private vehicle.
The coronavirus epidemic has introduced pressures to replace travel by using technical means of communication such as video and audio-conferencing facilities, and for walking and cycling to replace the use of cars on shorter journeys. It remains to be seen what effect Covid-19 has on the way we travel for work.
Company Car Use topic
Fleet Management topic
Fleet Fuel Management topic