Business travellers who use their own cars could be putting themselves and their companies at risk. Sara Turner explains why it’s safer to rent.
New legislation means that, for the first time, companies and organisations can be found guilty of manslaughter on the basis of gross corporate failures in health and safety. The Corporate Manslaughter Act, which came into force in April 2007, is about making companies more responsible for their employees’ welfare, and one area where it is having an immediate effect is on ground transportation.
“The new Act looks to complement the existing legislation rather than replace it,” says Roger Grainger, UK sales director for Avis. “It clarifies the responsibility of the employer towards employees and towards potential victims of its employees.”
Under the Act, a car being used for business purposes is considered a place of work, something which car rental companies have picked up on. According to research by Europcar, over a third of UK employers encourage staff to use their private cars for business, which may leave them exposed to potential health and safety pitfalls.
The survey, in which over 300 businesses took part, showed that 37 per cent of companies offer cash-for-car schemes and almost one in six (15 per cent) operates 100 per cent cash-for-car fleets. Europcar also found that almost 25,000 company car drivers had opted to take cash and use their own vehicle for business purposes.
The problem comes if the cars in this so-called “grey fleet” are not roadworthy. Obviously, there is an obligation on the employee here, but there is also one on the company to prove they have the processes in place to cover all aspects of their employees’ welfare whilst driving for business. As Andy Lewis, head of marketing for EMEA at Budget points out, this could well be costly if companies continue to allow employees to use their own cars. “For the ‘grey fleet’, the cost of the bureaucracy you would have to put in place to ensure that each and every car is checked at the appropriate time is significant. Plus, if your company has a car pool, there’s also the real cost of capital to consider. Those cars might sit idle for days, which is not a smart use of business capital.”
David McNeill, corporate sales director for Europcar, says that it is not a surprise that the current situation has arisen. “Transport has to be straightforward and cost-effective,” he says. “So it’s easy to see why many businesses encourage staff to use private vehicles for business, or offer cash for cars.” But a vehicle used for business travel, even for the occasional office errand, is regarded as a place of work and is subject to all the health and safety legislation that applies to the workplace.
Not surprisingly, the car rental companies point out that using them avoids all these problems. “By renting a car they can be absolutely sure it is fit for purpose,” says McNeill. “Ultimately, that is our business. It’s all we do. So they can be confident that, if they’re putting one of their employees out for business travel, then it’s in a vehicle that has been checked, is a new model, and has been regularly serviced.”
As an aside, McNeill adds that there are concerns about people’s driving skills. “There’s an awful lot of work that needs to be done around people’s driving habits,” he says. “Anything that makes people more aware of their responsibilities as companies and as motorists has got to be a good thing.”
According to Sixt, for company liability purposes, another good reason for choosing rental vehicles is insurance. Most car rental companies can utilise a client’s own insurance as part of a corporate rental package and it can provide, where required, third-party, damage and theft protection. This gives the reassurance that, should an accident happen, the vehicle is covered for any repairs, and compensation can be paid to any injured parties.
All the car rental companies offer special rates for businesses, plus drop-and-collect services. Competition focuses on service and the range of vehicles available, and avoiding or speeding up the process of form-filling. But concerns about the cost of renting a car can also be answered, say the companies.
Renting a car on demand which is suitable for the occasion has strong economic arguments behind it, since at an average of 40 pence a mile being paid to people who use their own cars on business, the cost of renting soon pays for itself. “All you have to do is pay a nominal fee to rent the car for the day,” says Grainger, “and you know that just by doing that you are ticking all of the boxes around these vehicle checks.”
As the Act is so new and untested in the courts, there is still a lack of clarity, but Grainger warns it should not be taken lightly. “In the nerve centre of the industry we’ve known this has been coming for a long time, but some people may not be well versed in what this legislation could mean,” he says.
“I’m certain that somebody is going to come a cropper and they are going to get dragged through the courts, on the front page of the paper, and everyone’s going to say, ‘That could have been us!’ The company will be found to be negligent and everyone will sit up and take notice.”
