By Jenny Powley, Sales Director Corporate Business, RAC Business
With the number of grey fleet vehicles now estimated at more than three times the number of company cars in the UK, the need to monitor and manage these vehicles is becoming increasingly vital for small businesses.
The consequences for failing to adhere to the relevant legislation are serious as fines of up to £20,000 can be handed out to businesses which don’t comply, and not being aware of the law is not an excuse.
Grey fleet vehicles are those which are owned and used by employees on business-related journeys and currently it is estimated there are four million grey fleet vehicles in the UK, More often than not, they may be used ad-hoc or for travel to make business appointments.
Although not technically company cars, fleet managers still need to be aware of certain facts, such as how many grey fleet vehicles they have, whether drivers have full clean licences and whether these vehicles are appropriately insured.
So whether you’re a small to medium-sized firm with a small fleet or a large corporate, tackling the grey fleet challenge head-on will help your business save money and meet duty of care responsibilities.
There can actually be benefits to grey fleet vehicles as they present a flexible, cost-effective solution. However, the management of the grey fleet can be complex because you don't own, and therefore don't control the vehicles. As such when a member of staff drives off to a business appointment in their own car, it’s possible to forget that they're actually in the business’ duty of care.
As a fleet manager you should be aware that health and safety legislation applies to employees making work-related journeys regardless of vehicle ownership, including the grey fleet. Therefore it makes business sense to treat your grey fleet as you would your company cars.
Fleet managers must show that grey fleet vehicles as well as company vehicles have followed safety policies and been included in any risk assessments, including an audit trail. Grey fleet vehicles need to be insured, safe on the road, and their drivers, of course, have to be eligible to drive. That should go without saying, but analysis by Licence Bureau has revealed that around five (5.42) in every 1,000 company car, van and truck drivers do not hold a valid licence to legally drive their company vehicle. As such, businesses need to be vigilant with checks.
Fleet managers should record data about the grey fleet just as they would for company cars, such as vehicle details, servicing and MOT information, insurance, taxation and licence checks.
Another issue to be aware of if reimbursement of fuel costs as many grey fleet drivers claim it back using the Government’s tax-free Approved Mileage Allowance Payments (AMAP). However this system is open to abuse and drivers may start to rely on fuel reimbursement as an additional income. Businesses also need to ensure that they can show accurate mileage expenses to avoid potential HMRC audit fines.
Meeting C02 emission standards can also be a challenge when operating a grey fleet as private vehicles may be older and less eco-friendly than your company cars. There is less control over the type of vehicles in the fleet and added to that the AMAP system does not incentivise more economic driving.
So, just how can you manage the grey fleet? Take control.
Advances in telematics tracking systems means that fleet managers are now in control by allowing them to use data and identify poor driving, which can be rectified by training, as well as reducing carbon emissions through more efficient driving techniques.
Risk management programmes can help combat the grey fleet challenge via training or assistance with writing policy documents. Outsourcing risk management can help businesses cover their duty of care responsibilities, whilst freeing staff to get on with the core task of growing their business.