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Grey fleet management

Grey fleet management – your obligations in black and white

The risks arising from grey fleet management are often neglected within businesses. Not only can general fleet management be overlooked by those operating fleets of company vehicles but many organisations simply do not appreciate that they have ‘a fleet’ of vehicles for which they bear- at least some- responsibility.

A recent YouGov survey revealed that six out of ten UK businesses doubted whether their existing fleet policy was sufficient to protect their business and employees under current ‘duty of care’ legislation. Yet in order to meet the obligations imposed by the Health and Safety at Work etc Act 1974, it is crucial that every company has a comprehensive and auditable ‘driving for work’ policy covering every element of their fleet operation, no matter how few vehicles are used and who owns them.

In this article, the often forgotten area of grey fleet is considered, the risk it can pose to unwary businesses and practical guidance offered on how to effectively manage your grey fleet.

What is Grey Fleet?

A business’s grey fleet are all vehicles, owned by its employees, which those employees use for business purposes. Grey fleet travel refers to mileage in employee-owned vehicles making journeys for business purposes. Unsurprisingly, it gets its name as this is a ‘grey area’ for fleet that many businesses forget about or simply do not think about.

All employees that use their own cars for business travel are seen as using grey fleet. There are estimated to be three to four million such vehicles being used on the roads in the UK today with nearly 1 in 4 vehicles being driven on business being a ‘grey fleet’ vehicle.

Businesses which require its employees to drive any distance to and from meetings, between sites or to visit laboratories or customers all effectively operate a grey fleet. Left unattended, the risks posed by such workplace activities can cost businesses dearly.

Why Manage Grey Fleet?

Many employers fail to appreciate that they are legally obliged to manage the grey fleet they operate.

The duties imposed by the Health & Safety at Work etc Act 1974 (HSWA) to ensure the health, safety and welfare at work of all employees and third parties who are affected by the activities of the business are sufficiently wide enough to impose on all employers a duty of care towards all employees making work related journeys as well as those who interact with these employees whilst they travel for work purposes.

No distinction is made under safety law between general fleet vehicles and grey fleet vehicles and the obligations that arise under HSWA and its regulations apply regardless of who owns the vehicle employees travel in whilst working for the organisation. Whilst ‘work related driving’ does not include the normal commute to and from the base office, it covers all other driving activities for work such as driving to and from customer meetings, business offices, making ad hoc collections or deliveries.

So if an employee falls asleep at the wheel on the way back from a long business meeting off-site, which injures a fellow road user, the business as well as the driver could be held accountable for that accident. This remains the case even when the driver was using their own vehicle.

As a significant risk, the general use of grey fleet must be risk assessed. Companies must ensure that they adopt a safe system of work put in place to manage the use of private vehicles for business purposes, ensuring that then their staff are trained on the systems and any risks. Any safe system of work through a grey fleet policy must actually be implemented, monitored and reviewed to avoid criticism in the event of an incident. Companies must ensure that this is firmly incorporated into existing safety management systems.

In addition to the range of applicable safety legislation, businesses may also find themselves in breach of The Corporate Manslaughter and Corporate Homicide Act 2007 if they fail to correctly manage their grey fleet. A failure to meet the required legal standards constitutes a criminal offence for which businesses and its employees and managers could be convicted. If found guilty of breaching safety laws, companies face unlimited fines and untold reputational damage. As stated, individuals could also face prosecution and upon conviction, imprisonment.

But whilst there are clear legal reasons for managing such a fleet, there is also a strong business case for managing work-related road safety. Controlling the number of journeys undertaken by staff, as well as how and when those journeys are made allows businesses to reduce the likelihood of a work related road accident taking place. Fewer road incidents means:

  • fewer days lost to injury
  • fewer repairs to vehicles
  • less business disruption
  • reduced running costs (mileage claims from employees)
  • more competitive business insurance premiums
  • reduced damage to business reputation.

Travel using grey fleet is often perceived as the easiest method of transport for employers and employees alike. Employers gain the advantage of having a readily mobile workforce without incurring the capital expenditure and ongoing costs of sourcing a business fleet of vehicles. However, with the advantages come disadvantages as businesses must take steps to ensure employees are capable of driving safely for work purposes and that their vehicles are fit for purpose.

Enforcement of grey fleet safety

The HSE is becoming increasingly interested in managing workplace driving risks and driving at work. As between 25 and 33% of all fatalities and serious injuries on Britain’s roads involve somebody who is driving for work purposes this interest is unsurprising. As far back as 2003, the HSE went on record to state that organisations have the dame duty of care towards its employees making work journeys regardless of vehicle ownership.

However, road accidents are still not reportable under the Reporting of Injuries, Diseases and Dangerous Occurrences Regulations 1995. They are simply left to the Police to investigate, and their focus is on driving standards and occasionally on employers for “aiding, abetting, counselling and procuring the commissioning of road traffic offences by employees”. Such charges against employers would usually require proof of knowledge on the part of the employer that the vehicle, driver or activity was unlawful. The Police focus has not been on looking at the circumstances to why the driving was driving, and instructions/practices from their employer. The HSE has issued guidance on how they would normally deal with work-related road traffic accidents and acknowledge that where a road traffic accident has arisen because of a serious managerial failure then use of health and safety law may well be appropriate and therefore employers may find themselves at risk, especially in the undermanaged area of grey fleet.

Risk Areas

When considering your employees driving their own vehicles, you must consider some of the risks that they are exposed to within your control:

  1. Insurance – this must appropriately cover business use, not just social and domestic purposes. If an employee is involved in a serious collision, claimants may look to the employer to claim from as they will undoubtedly have more money and it can be argued that they were under a duty to manage the employee. This can particularly arise where it turns out that the employee had the incorrect insurance. PRACTICAL TIP: CHECK THAT EMPLOYEE’S INSURANCE INCLUDES BUSINESS USE COVER
  2. Safety of the Vehicles – businesses must be satisfied that vehicles being used by employees for business use are fit for purpose and meet a pre-defined basic level of safety. For example, employers may want to think about imposing a maximum age or mileage on a vehicle being used for grey fleet purposes. Another control that can be implemented on grey fleet vehicles is insisting on a minimum standard of maintenance being observed by employees, for example, ensuring that the vehicle is serviced by the manufacturer and that MOT checks are completed and copies of certificates handed in. PRACTICAL TIP: ASK TO SEE THE MOT CERTIFICATE FOR EMPLOYEE VEHICLES
  3. Driver Competency – ensure that drivers are competent and capable of doing their work in a way that is safe for them and other people, for example, has the employer considered whether the driver has the necessary driving licence and if so whether further training is required to carry out that particular task? Is the driver sat on 9 points with the clear potential of losing their licence? PRACTICAL TIP: TWICE A YEAR ASK TO SEE THE PAPER AND CARD DRIVING LICENCE FOR EMPLOYEES
  4. Fitness and Health – the employer has ignored obvious signs that an employee may be unfit to drive, for example, from the effects of drink or drugs (it may be known, albeit ‘off the record’ that an employee has an issue) or medication. PRACTICAL TIP: ENSURE THAT HR HAVE A ROLE IN FLEET AND GREY FLEET POLICIES
  5. Mileage – driver’s being asked to travel more than 50 miles before and after a full days work/meetings are liable to drowsiness. Also time pressures being placed on employees to get between locations can lead to poor driving or risks of the employee having to eat, drink, or speak on the telephone at the wheel. PRACTICAL TIP: ENSURE PROPER PLANNING AND MANAGEMENT OF MEETINGS AND DEMANDS ON EMPLOYEES
  6. Mobile Telephones – it is well known that it is illegal to use a hand-held mobile phone or similar device whilst driving.  However HSE guidance suggests that employers can also be prosecuted if employees are distracted because they require them to use their mobile phones (or even hands-free) whilst driving. As a minimum, employers must have a mobile phone policy in place giving employees clear guidance on the use of mobile telephones and / or hands-free devices. PRACTICAL TIP: IMPLEMENT AND ENFORCE A MOBILE TELEPHONE POLICY AND CHECK LICENCES FOR OFFENCES CODES CU80 (MOBILE TELEPHONE USE) AND MS60 (FAILURE TO HAVE PROPER CONTROL)
  7. Workers carrying dangerous materials – this is a potential risk in the scientific sector, where the transportation of chemicals and dangerous substances could be a daily occurrence. Risk assessments should be carried out on a normal basis, and you should always ensure that the type of vehicle being used is suitable for that particular job. PRACTICAL TIP: RISK ASSESS AS YOU WOULD WITH ANY DANGEROUS GOODS CARRIAGE

Grey Fleet Policy

Hopefully, it is now clear that the recommendation is that employers look at their employees’ travel and where grey fleet is relevant; a proper policy is drawn up and implemented. Any employer with robust policies and procedures and a strong audit trail would be best placed in the event of an incident.

The Policy should look primarily at two things

  1. The driver – does the driver hold a valid driving licence? Are they fit to drive?
  2. The vehicle – does it have an MOT, is it roadworthy, is it properly insured?

It should be set out that employees will only be reimbursed for expenses for which they actually and necessarily incur in the course of official travel. The policy could set out that decisions whether or not to use grey fleet should be made by line managers to ensure that their employees use the most efficient and economical means of travel, taking into account the cost of travel, the cost of subsistence and savings in official time. You could look at the necessity of the journey, for example can the need for the journey be carried out equally well using video conferencing facilities, telephone, email? Is a colleague already travelling to the same meeting or location by car, with spare capacity etc?

Finally, the policy ought to cover a ’round up’ on safety points, explicitly setting out, amongst others things, the prohibition on the use of mobile telephones whilst driving, observing speed limits, taking regular breaks and so on.

Effective management goes beyond drafting the policy. Employers must ensure that they are ‘practising what they preach’ and ensuring that the policy is enforced across their business. It is no use to say that employees must have appropriate business use on their insurance if you are not checking.

Conclusion

If you do two things from today to take a step in the right direction, as a minimum, we would urge you to ensure that your employees are properly licensed and insured before you allow them out on the road for work purposes, whoever the car belongs to.

However, if you follow the advice set out above, you should have no problem in ensuring that grey fleet within your business looks pretty black and white to your employees.

lorrylawyer@dwf.law

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