RSS Feed


More Articles: Latest Popular Archives

Grey fleet is a grey area

Are you and your business drivers breaking the law? Simon Turner Managing Director of Fleet21 presents some Essential facts about assessing and managing your grey fleet risk.

“Grey fleet” is a term given to those drivers who use their own vehicles to make business journeys and we have seen that employers are now focusing more and more of their attention on assessing this risk. The reason for this is because employers are starting to realise that, however far, or frequently, their grey fleet drivers’ travel, they still pose a significant risk to their business. Despite this, HR departments are often unsure how to assess this risk and what action to take. To tackle the issue, the first thing to do is understand exactly what constitutes a grey fleet. In short, any member of staff who uses their own car to make a business journey, however small, can be considered a grey fleet driver. For instance, these might be employees who only make the occasional work trip, or they might be high mileage reps who have taken a cash option to purchase their own car, rather than take a company car. In each case, the employer is making the decision to use the employee’s car as a company vehicle and therefore, it must be treated as such.

The criteria for assessing risk can be divided into two key areas – legal compliance and driver knowledge. Should the worst happen, and one of your grey fleet drivers be involved in a serious accident that causes injury to either themselves or another road user, it goes without saying that the police will investigate the circumstances surrounding the incident. As part of this investigation, they will pay close attention to ensure that all legal obligations under the Health and Safety at Work legislation had been completed by the respective employer. This investigation may include questions such as: Did the driver have a valid driving licence? Was the driver correctly insured? Was the vehicle roadworthy? Was the driver in a fit state to drive? Did the employer have a driving policy in place? Did the employer make the driver aware of his/her own responsibilities when driving on behalf of the organisation?

If you’re an employer and you’re unable to answer these questions satisfactorily, and prove that you have done your best to assess and minimise any risk associated with your grey fleet drivers, then you could end up facing unwelcome legal action. The vast majority of incidents are, and will continue to be, dealt with as breaches of the Health and Safety at Work Act for which the penalties are quite severe. These include a £20,000 fine for each proven breach – and any single incident could involve multiple breaches, plus the possibility of director disqualification or negative publicity order whereby the judge orders the guilty company to advertise the circumstances surrounding their conviction.

Therefore, it’s clear to see that when HR fails to assess and manage risk appropriately, the consequences can be catastrophic. So, what do you need to do to ensure you deal with these risks appropriately? The first step is basic compliance activities. The easiest way to start covering your obligations and minimising risk is to have a suitable driver policy in place and a driver handbook available to all employees, which clearly states their personal responsibilities and why these are important, both for them, and you as their employer. Then you, as the employer, need to complete a series of simple driver checks too. It may sound obvious, although there are many organisations that still don’t do this, but employers need to regularly check the licences of each of its drivers.

Recent research has shown that there is estimated to be 24,000 employees driving illegally for companies in the UK.1 This includes drivers who only have provisional licences, those with licences that have been revoked or suspended and those who have invalidated their insurance by amassing too many penalty points. It goes without saying that you wouldn’t want anyone listed in the above categories driving for your business. Yet, if you aren’t checking these, then how would you know?

In 2003, the Health & Safety Executive produced a very simple common sense guide called Driving at Work in which it specifically asks: “Do you check the validity of the driving licence on recruitment and periodically thereafter?” The key part of this is “…and periodically thereafter” because, whilst it is obviously essential to check an employee’s driving licence when they first join, it is also crucial that you keep checking it. At Fleet21, we have found that drivers often fail to inform their employers about penalty points, and even when banned from driving, because they know they would lose their job if they were found out. It’s a scary thought and if any of these drivers were stopped or involved in an accident then the company could, and often does, find itself liable.

Insurance is another potentially confusing subject. Many employees may not even realise that they require business insurance, so it is essential that the employer highlights this out to them and insists that they take out suitable cover. Remember, as an employer, you have effectively commandeered the employee’s car for use as a company vehicle and therefore, take on the associated responsibilities. An employee’s standard private motor policy for social, domestic and pleasure use will generally only cover them to travel between their home and one main place of business. An employee such as a sales rep, who is on the road all the time, is obviously going to require business motor insurance. However, if you ask an employee to work from a different office one day a week, or ask another to make a detour via a client or a supplier, or simply to run an errand, such as going to the bank or post office, then this also becomes a business journey for which they may not be covered under their own insurance. If the employee doesn’t have business motor insurance, you could be deemed to be asking that employee to break the law, i.e. to drive without proper insurance.

Where it gets even more confusing is with the different types of business insurance available. We estimate that 20 percent of those employees that do have business insurance actually have the wrong type and, therefore, aren’t covered correctly. As an employer, you should make sure the employee is aware of what types of journey they will be expected to undertake, and in what circumstances, so that they can discuss the matter with their insurers and get the correct policy.

Receive more HR related news and content with our monthly Enewsletter (Ebrief)