Grey fleet – a grey area?
Many UK employers don’t realise that they have a responsibility for grey fleet vehicles, but they do. Research from Driving for Better Business (DfBB) indicates that 60% of executive directors surveyed didn’t even know if they had a grey fleet, or how big it might be.
What is grey fleet?
It refers to vehicles that don’t belong to a company but are used for business travel. It includes any vehicle privately owned or rented by an employee that is used for transport connected to their job.
Employer responsibilities and legal duties
All employers have responsibilities regarding vehicles used for business purposes, and this applies to privately owned or rented vehicles used by staff in the course of their employment, as well as company-owned vehicles. Employer responsibilities with regard to these vehicles include ensuring that:
• Vehicles are taxed and serviced with a valid MOT
• The driver has a valid and appropriate driving licence
• The vehicle is insured for business use
• The driver conducts regular safety checks
• The vehicle is not driven in a dangerous condition
Temporary delivery drivers who are taken on around Christmas or other busy periods and who drive their own vehicles are still considered grey fleet.
Problems and risks
It can get complicated keeping track of these vehicles and managing safety effectively. Employees using their own cars are not usually covered by company insurance, and the company has no direct responsibility, or authority, to take them in for servicing, MOTs and safety checks. They do, however, have the responsibility of ensuring that the owner or other relevant party does so.
There are different levels of business insurance required depending upon the use of the vehicle (Class 1/2 – driving to multiple places of work, such as a care worker, Class 3 – high mileage such as salespersons and specialist commercial insurance for delivery drivers).
Fleet managers also need to ensure that any vehicle used for work purposes is currently roadworthy and fit for work purposes, and that employees who drive for work purposes hold a valid licence and insurance documents.
One major problem is that not all companies have a fleet manager, or know how to manage a grey fleet. Many business owners may not even realise that they are responsible for cars owned by employees but used for business purposes. In the DfBB survey mentioned above, 53% of executives surveyed believed, incorrectly, that the company was not responsible for its grey fleet.
Grey fleet vehicles can be of benefit to businesses, saving them the time and expense of maintaining company-owned cars. It is vital to remember, however, that these vehicles are still company responsibility and must be actively managed. This is fine if a company employs a large number of grey fleet drivers and a dedicated fleet manager. However, many companies that benefit from these vehicles are smaller companies where employees use their vehicles (or rent vehicles) for work purposes from time to time, and there is no dedicated staff member to oversee the management of the vehicles involved.
Managing your grey fleet will require you to appoint someone to monitor all vehicles used for business purposes. You do not need a dedicated staff member. Indeed, in small companies with few vehicles, it will only take up a small amount of time for an existing staff member.
To ensure good grey fleet management, all business-related travel should be approved in advance. It can then be ascertained if a grey fleet vehicle is the best form of transport. It is important to put a grey fleet policy in place, outlining the minimum vehicle standards that employee-owned cars must meet in order to be approved as grey fleet and used for business travel. At a minimum, this will include all legally required criteria such as suitable insurance, up-to-date road tax, and a valid MOT.
Grey fleet vehicles can be a convenient and cost-effective option for many businesses, but they do need to be checked, monitored and carefully managed.