960,000 people in the UK currently use a company car – including field sales, directors, delivery drivers, meter readers and many more.
But who’s responsible when things go wrong?
A study conducted by RAC Business found that a whopping 9 out of 10 company car drivers admit to speeding on motorways, and almost half admit breaking the speed limit on MOST journeys – which is almost double the figure among private motorists (26%).
So, let’s say a driver is caught speeding in a company car. Who’s actually responsible? The driver? The employer? Both? Let’s explore the answer…
First, let’s look at what actually happens when an employee is actually caught speeding in a company car?
For starters, it depends on how they’re caught.
If they’re pulled over by the police, they’ll need to provide their details at the scene. It’s their responsibility to disclose the incident and any resulting action to you as their employer.
If they’re caught by a speed camera, a notice of intended prosecution (NIP) will probably materialise through the post, addressed to the ‘registered keeper’ which, for most company cars, will be the company’s business address. Or if you lease your vehicles, then it will most likely be sent to the leasing company.
The company who receives this notice is then fully responsible for naming the driver and, indeed, failure to disclose this information can itself be considered an offence – which can be alleged against either an individual or a company.
If the company is not in a position to be able to name the driver, it needs to prove that reasonable diligence has been used to find the driver’s identity, in accordance with Section 172(4) of The Road Traffic Act 1988. Even then, the company needs to prove that no records were kept to show who was driving or is driving the car at any given time, and why that was the case. If a company is legitimately unable to name the driver, nobody can be prosecuted. However, an offence of failing to provide driver information carries a fine of up to £1000.
Of course, ultimate responsibility for the way a vehicle is driven, lies with the driver.
But things get murky when that vehicle is being driven for work purposes – regardless of who owns the vehicle.
When a driver is using their vehicle for work – whether for central part of their daily role, or simply for a short trip to a sales meeting – the employer shares responsibility for making sure that the vehicle is roadworthy, and driven safely.
A range of legislation mandates employers to keep their employees safe – as well as anyone who may be affected by their actions at work – and this still applies if that working environment is out on the road, rather than in the office.
It is possible that employers can be prosecuted for offences ranging from corporate manslaughter to aiding and abetting in the event of a serious incident.
So, yes, an employee is responsible for the actual offence of exceeding the speed limit. But you, as their employer, might be held liable if the driving is considered to be reckless and leads to an accident, and you can’t demonstrate that you’ve reasonably fulfilled your duty of care obligations.
Speeding: the true costs
A driver being caught nominally over the speed limit will generally be dealt with by way of penalty points on their license and a fine (usually payable by the employee themselves). Indeed, research from Lex Autolease has found the amount of money being paid out on fines against company cars has risen by 25% over the last two years.
Of course, penalty points bring their own level of cost which can affect not just the employee, but you as their employer. Research from comparethemarket.com suggests that drivers who clock up six penalty points on their license – which can now happen with one speeding offence – could see their own insurance premium rise by a staggering 76%.
Speeding can also manifest itself in a variety of other cost factors. For example, according to the Department for Transport, driving at 80mph can use 25% more fuel than driving at 70mph, which can add up to a significant impact on a business’ bottom line, even for smaller fleets.
Who’s responsible for speeding in company cars? The driver – pure and simple.
But as an employer, you shouldn’t assume that this exonerates you from extensive responsibilities. A telematics system is a quick and effective way to monitor and measure the behaviour of your drivers, helping drive efficiency, save money and make life easier and safer for drivers in your organisation.
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Please note: The information in this blog post is meant for reference only. TomTom Telematics does not warrant or imply that the use of this text or its products or services can in itself guarantee compliance with your tax or legal obligations. To ensure compliance with these obligations you must always seek individual advice from a legal counsel or a qualified tax compliance specialist