Cash-for-car schemes 'a safety timebomb'
Privately-used cars driven on business fail to register with the vast majority of company bosses as a risk management issue...
Latest research from a number of organisations has highlighted significant concern at the apparent lack of control that many employers appear to have over the maintenance and repair of cars driven for work purposes but which are officially owned by the employees themselves
But, where it has registered, it is believed to be the reason for a number of businesses to turn their back on the trend to offer cash alternatives to the traditional company car.
Latest research from a number of organisations has highlighted significant concern at the apparent lack of control that many employers appear to have over the maintenance and repair of cars driven for work purposes but which are officially owned by the employees themselves.
However, legislation makes it abundantly clear that employers have an obligation to ensure that vehicles driven for business reasons, irrespective of how they are funded, are fit for purpose and entirely legal and responsibility cannot be passed off on to individual employees.
Calling the growth of cash-forcar schemes 'a safety time bomb waiting to go off', Steve Johnson, of the Fleet Safety Association, said regular safety checks on privately-owned cars driven on business were frequently ignored.
Highlighting the dangers of tyre neglect, ignoring fluid levels, the 'one eyed monster' - cars with one headlight out - and the chancers who ignore the tortured squeal of metal on metal brake components, and, said Mr Johnson, all are a recipe for potential disaster.
"The only way to address the problem is for employers to implement some form of mechanical inspection on a regular basis to ensure that vehicles are in a safe condition. It is not suffi cient for a well-meaning amateur to carry out a casual visual check, which is highly likely to miss something crucial," he said. "Without checks like this taking place as a matter of routine, employers really are not only risking their reputation but also falling short on their corporate governance obligations."
But, 35% of HR and finance directors do not believe employees driving their own cars for work are a cause for concern. However, the same survey, carried out by vehicle management group LeasePlan among 150 finance and HR directors, also found that 89% viewed driver safety and corporate liability as a key issue.
The survey reveals a worrying gap in the understanding of the issues surrounding employers' duty of care and LeasePlan managing director David Brennan, said: "These findings suggest that many companies have still to fully understand the scope of that liability.
"Employers have far less control over the maintenance and condition of those cars and if an employee is in an accident, a business could still find itself facing litigation if the vehicle is deemed poorly maintained and unsuitable."
Given the issue Mr Brennan said that companies should consider encouraging cash-takers back into company cars, where there is 'strict control over the maintenance and condition of the vehicles'.
That is a trend that rival car leasing firm Alphabet identified in its report Risk and Reward 2007, which revealed that only 40 out of 251 companies questioned were more likely to offer cash in the future. When the same question was asked in 2005, half of the companies said they were more likely to offer cash. Almost two thirds of companies said they did not intend to increase their use of cash while 11% were less likely to offer cash in future, while 32% of employers were in favour of returning to company cars.
Better control and manageability were the top reasons given by firms that saw returning to company cars as positive.
Richard Schooling, Alphabet commercial director, said: "These findings certainly suggest that more employers are factoring issues such as duty of care and adequate control over driving at work into their fleet funding decisions. They also underline the fact that the decisions firms make on fleet funding and at-work road safety are inextricably linked. Businesses can leverage the link to design safer, lower-cost fleet operations."