University Car/Car Allowance Policy Human Resources July 2009 LM/HR/University Car Policy Contents Page 1. Introduction 2 2. Essential Car Users 3 3. Options for Essential Car Users 3 4. University Car 3 5. Monthly Car Allowance 5 6. Business Mileage Rates 6 7. University Car Tax 7 8. Temporary Car 7 9. Insurance for University Cars 7 10. Insurance for Employee’s Private Cars 8 11. Entitlement to Drive 8 12. Fitness to Drive 8 13. Health & Safety 9 14. Driver Training 9 15. Motoring Offences 9 16. Taking a University Car Abroad 10 17. Change of Job Role 10 18. Secondments and Temporary Positions 11 19. Absence from Work 11 20. Suspension from Work or Garden Leave 11 21 Return of University Car 11 22 Monthly Allowances and Eligibility Criteria 12 University Car/Car Allowance Policy 1 1.0 INTRODUCTION 1.1 The University may, at its discretion, provide a University car or a Monthly Car Allowance to employees whose principal duties require extensive business travel. The principal indicator will be the requirements of the job role but a review of needs will be carried out when an employee drives more than 12,000 business miles in a year. Once agreed, employees who require a University car or a Monthly Car Allowance will be defined as ‘essential car users’. This classification will be reviewed annually and where an employee has reduced his/her mileage to below this level the company car/monthly car allowance will be reviewed and may be removed. 1.2 This document outlines the options, allowances and choice of cars available to employees who are eligible to receive a University car or a Monthly Car Allowance and the responsibilities and actions required of the employee. 1.3 In each case, the University will consider the use of alternative transport modes, but if the annual mileage is 12,000 business miles or above these are likely. In considering the choice of University cars and setting the monthly car allowance, the University has included the following eligibility criteria for cars: environmental impact; safety; reliability; whole life costs security of University property kept/transported in the car 1.4 The choice of University car must be suitable and appropriate for business use and the University reserves the right to disqualify any car chosen by an employee that is considered unsuitable or impractical for business use. 1.5 Some car makes and models are excluded from this policy because they do not meet the required eligibility criteria and standards. Examples of vehicles excluded from this policy are listed below although it must be noted the list is not exhaustive. If in doubt about any of the definitions below, employees should contact the University Transport Manager. vehicles with less than 4 adult seats kit cars car-derived vans vans commercial vehicles pick-ups convertibles off-road vehicles mobile homes/caravanettes three-wheeled vehicles motorcycles scooters quadricycles University Car/Car Allowance Policy 2 2.0 ESSENTIAL CAR USERS 2.1 An essential car user is defined as an employee whose principal duties, such as those associated with business development and sales, involve him/her in a considerable amount of business travel (see 1.1 above) on a regular basis. Two options for car usage are available to essential car users and these are set out in section 3. 3.0 OPTIONS FOR ESSENTIAL CAR USERS 3.1 Essential car users will have the option of: a fully maintained University car supplied on contract hire a monthly car allowance paid into salary Both of the options above are subject to the conditions laid out in this policy. 4.0 UNIVERSITY CAR 4.1 The option of a University car is based on a monthly allowance aligned to job grade which allows the employee a reasonable and diverse choice of cars, whilst meeting the selection criteria for environmental impact, safety, reliability and whole life costs. The monthly allowances by job grade are shown in section 22, which may be subject to change. 4.2 University cars are usually supplied on contract hire including maintenance for a period of 3 years and 60,000 miles. However, this may be reviewed in line with the likely required usage and/or the mileage accumulated. 4.3 A University car remains the exclusive property of the University and may be used only by the employee and nominated authorised driver who must be a partner or immediate family member - see Section 9. 4.4 The University car must meet the following eligibility criteria: 4.5 have a maximum registered carbon dioxide (CO2) exhaust emissions of 150g/km; have a minimum Euro NCAP safety rating for driver and passengers of 4 stars: be fitted with a hands-free mobile phone kit or Bluetooth compatibility for hands free mobile phone. If this equipment is not fitted as standard, it must be fitted. If the cost exceeds the monthly contract hire rate, the University will pay the additional cost. have a manufacturer fitted alarm and vehicle security system fitted as standard. The University will supply the employee with the following safety items where they are not included in the specification of a car, which remain the property of the University: a first aid kit a high visibility jacket or vest a warning triangle a torch University Car/Car Allowance Policy 3 4.6 The monthly contract hire rate for a University car supplied to the University includes the cost of: 4.7 planned service, maintenance and repairs vehicle road fund licence replacement of worn tyres UK breakdown and recovery service The employee is responsible for: keeping the car secure (and alarmed as appropriate) parking safely on campus when at the University and paying appropriate car parking charges parking the car off road where possible when not being used. removing any University property from the car when left unattended 4.8 An employee who chooses a University car whose monthly charge is less than the allowance will not receive any payment for the difference. 4.9 An employee must not modify or add accessories to a University car without the permission of the Head of Department. If permission is granted, the employee will be responsible for the cost of the modification or accessories and the cost of removing them at the end of the contract if necessary, any costs of making good and/or extra depreciation associated with the modifications. 4.10 An employee is responsible for maintaining the University car in a clean and tidy condition, and that it is regularly serviced and maintained in accordance with the schedule set out by the manufacturer. 4.11 If an employee finds a fault with their University car, they should report it in the first instance to the supplier of the car. The supplier will authorise any necessary repair work to be carried out and pay the cost of the repair. The costs for any unplanned maintenance or repair work will be recharged to the University accordingly. (Employees should note that if a fault with or repair for a University car is considered to be due to negligence or misuse of the car on the part of the employee concerned, the University will seek to recover the full cost of the repair from the employee.) 4.12 The University car is available to the employee for private use and will therefore be subject to “benefit in kind” taxation which will be deducted via the payroll. The employee must notify their local tax office of any change in circumstances in writing with a copy to the Payroll Office in the University. The University car is available for the employee’s partner or immediate family member to drive subject to approval from the Head of Department and subject to the conditions of cover stated in the University’s Vehicle Insurance Policy – see http://www2.warwick.ac.uk/services/finance/insurance/motorfleet. See Section 9 for Insurance details and requirements. The key qualifying conditions are that a partner or family member must be over 21 years of age, hold a full UK or EU equivalent driving licence, which has been in force for at least 1 year and have no serious driving convictions (any period of disqualification must have expired by at least 1 year). If the designated partner/family member is under 25 and has an ‘own fault’ accident, the University Car/Car Allowance Policy 4 employee will be responsible for the payment of the excess for any insurance claim. This provision will be reviewed from time to time. 4.13 Employees who choose the University car option will first be allocated an unassigned car from the University fleet in the appropriate category. The type and capacity of car assigned to the employee will be appropriate to their job role and will meet the eligibility criteria specified in section 5. If there are no unassigned cars available, the employee may choose a new University car from a list of qualifying cars, which is available from the University Transport Manager. 4.14 Approximately four months before the end of the contract term the employee to whom the University car is assigned will be contacted and will be offered: an unassigned company car a new University car supplied on contract hire payment of the monthly car allowance into salary 4.15 The University reserves the right to extend the contract term of a University car if it is in the University’s financial interests to do so. In such circumstances the employee will be contacted and consulted before any decision is made. 5.0 MONTHLY CAR ALLOWANCE 5.1 The monthly car allowance is payable in return for the employee’s agreement to be mobile at the reasonable request of the University, and is equivalent in value to the provision of a company car, but with the addition of a payment of £10 as a contribution towards the cost of the employee’s car insurance premium referred to in section 10. 5.2 The monthly car allowance is non-superannuable (ie does not contribute towards pension payments) and is not subject to any annual pay award. It will be subject to review at intervals and amended accordingly. 5.3 The monthly car allowance must be used by the employee to fund the acquisition, running costs and insurance for a private car used for business travel. The allowance will be subject to the following eligibility criteria (which the employee must supply documentary evidence of meeting) the car used for business travel must be less than 4 years old have a maximum registered carbon dioxide (CO2) exhaust emissions of 150g/km have a minimum Euro NCAP safety rating for driver and passengers of 4 stars have a manufacturer fitted alarm and vehicle security system fitted as standard. be fitted with a hands-free mobile phone kit or Bluetooth compatibility for hands free mobile phone be suitable and appropriate for business use (the University reserves the right to disqualify any car used by an employee that is considered unsuitable or impractical for business use) be insured for Class 1 business use University Car/Car Allowance Policy 5 5.4 The University will supply the employee with the following safety items where they are not included in the specification of a car, which remain the property of the University: a first aid kit a high visibility jacket or vest a warning triangle a torch 5.5 The monthly car allowance will be paid into the employee’s monthly salary and will be subject to current PAYE taxation and National Insurance contributions. 5.6 Employees must ensure that the car used for business travel is regularly serviced and maintained in a safe and road worthy condition at all times. The employee’s car used for business travel must comply with the Road Traffic Act and at all times display a valid vehicle tax, have a current MOT certificate (where required) and be insured for business use. Employees are responsible for: checking fluids and lubricants regularly checking tyre pressures, tread depth and general condition of all tyres regularly (note: minimum legal tread depth in UK is 1.6mm across 75% of the width of the tyre and 100% of the circumference) checking lights and electrical equipment regularly servicing in accordance with the manufacturer’s schedule keeping the car secure (and alarmed as appropriate) parking the car off road where possible when not being used parking safely on campus when at the University and paying appropriate car parking charges removing any University property from the car when left unattended 5.7 The University reserves the right to inspect vehicle documents and carry out physical checks of an employee’s private car used for business travel without notice. 5.8 If an employee opts to receive the monthly car allowance, but then wishes to take a University car instead, the employee must submit a written request to the Head of Department. 6.0 BUSINESS MILEAGE RATES 6.1 Business Mileage rates are paid to employees using University cars or receiving the monthly car allowance and are in line with the Approved Mileage Allowance Rates (AMAR) issued by HMRC, which are reviewed from time to time. The rates can be viewed on the University intranet: www2.warwick.ac.uk/services/humanresources/payroll/expenses/uk1/travel 6.2 Mileage is paid for authorised business miles accumulated less the distance between the employee’s normal residence and the employee’s normal place of work. 6.3 Fuel cost is not reimbursed by the University for any private mileage incurred while using a company car. University Car/Car Allowance Policy 6 6.4 The mileage allowance rates for essential car users are the same; the allowance factors in the cost of wear and tear and depreciation. A higher mileage rate is paid to employees who occasionally use their private car for business and the higher rate reflects an allowance for wear, tear and depreciation. 7.0 UNIVERSITY CAR TAX “BENEFIT IN KIND” 7.1 At the end of each financial year, the University will collate data on the use of University cars in the form of a return for HMRC (Her Majesty’s Custom and Revenue). A copy of form P11D will be sent to employees assigned University cars to assist them in the completion of their own tax return. 7.2 The University has a duty to inform the HMRC of the monthly payments made by the employee who adds optional extras to their company car. Such payments reduce the amount of taxation levied on an employee for the benefit in kind they receive through use of the car. 7.3 It is the responsibility of the employee to inform HMRC at the earliest opportunity of any changes that could affect their personal tax liability. 7.4 An employee who is assigned a University car, which has accessories added by the previous driver, will be responsible for paying the benefit in kind tax liable in respect of the P11D value of the upgraded car. Where the tax liability represents a substantial increase to the employee’s expected level of benefit in kind tax liability, individual circumstances will be considered. 8.0 TEMPORARY CAR 8.1 There may be occasions when it is necessary to supply an employee with a temporary contract hire car or short-term hire car. Arrangements for an employee to use a temporary contract hire or a short-term hire car will be decided and organised by the Head of Department, following advice from the University Transport Manaqer. 8.2 Use of a temporary contract hire car or short-term hire car is considered by HMRC as a benefit in kind and therefore tax is payable by the employee accordingly. 9.0 INSURANCE FOR UNIVERSITY CARS 9.1 All vehicles owned, on contract hire, rented or loaned to the University are covered by the University’s fully comprehensive motor insurance policy which is available at http://www2.warwick.ac.uk/services/finance/insurance/motorfleet 9.2 Departments must ensure that individuals are suitably qualified to drive and must obtain a copy of the driving licence of anyone (including individual and nominated authorised driver) intending to drive a vehicle owned or hired by the University (a provisional licence is not acceptable). Driving licences should be examined at least once on an annual basis. The nominated authorised driver must also complete the Additional Drivers Form (Appendix 1) and submit this to the University Purchasing Office with a copy of their driving licence. University Car/Car Allowance Policy 7 9.3 The policy does not provide Breakdown cover which is the responsibility of Departments to arrange. 10.0 INSURANCE FOR EMPLOYEE’S PRIVATE CAR USED FOR BUSINESS TRAVEL 10.1 Employees who use their private car for business travel must arrange Class 1 Business Use insurance cover. The University must receive a copy of the employee’s motor insurance certificate which will be held on the employee’s personal file, before the monthly car allowance payments are made. 10.2 It is the responsibility of any employee in receipt of the monthly car allowance to maintain valid insurance cover for the use of their car on business and to submit this to the Department. The University cannot be held responsible if, for any reason, the employee’s motor insurance policy becomes invalid and the employee is then involved in an accident, or has a claim made against them. The employee must notify the Head of Department and the Transport Manager if he/she is no longer covered. 11.0 ENTITLEMENT TO DRIVE 11.1 Before becoming an essential car user, all drivers including nominated authorised drivers must present their original driving licence and information on eye examinations/medical conditions to their line manager for inspection and a copy(s) will be held on the employee’s personal file. 11.2 Driving licences will be checked at least once every 12 months, but the University reserves the right for line managers to check driving licences more frequently where a driver has accumulated penalty points on their driving licence. 11.3 Employees must inform their line manager immediately if they or a nominated driver receive any fixed penalty points, endorsements on their driving licence, or any convictions for a driving related offence. 11.4 The University’s insurers reserve the right to refuse insurance cover for any driver and their decision is final. Should such a decision have an impact on the employee’s ability to carry out his/her job role, this will be discussed with the employee. 12.0 FITNESS TO DRIVE 12.1 Employees who drive a car on University business have an obligation to inform the Driving and Vehicle Licensing Authority (DVLA), and the University, if they have a medical condition that may have an adverse effect upon their fitness to drive. Further information can be obtained from www.dvla.gov.uk or from the University’s Transport Manager. Failure by the employee to notify the University of any Medical Conditions that affect their fitness to drive may result in further action being taken against the employee. 12.2 If an essential car user has their driving licence suspended by the DVLA for medical reasons, a meeting will be held between the employee, their line manager/Head of Department and a member of the Human Resources Team in order to discuss the impact on the employee’s ability to carry out his/her job role. University Car/Car Allowance Policy 8 12.3 It is a legal (and disciplinary) offence for a driver to drive a vehicle whilst under the influence of alcohol or drugs at any time. Employees are expected to comply with the prevailing law and regulations at all times. 12.4 The University reserves the right to require an essential car user to undertake a medical examination, including a sight examination, at any time. 13.0 HEALTH & SAFETY 13.1 The University’s Safety in the University (SITU) policy covers Transport and Travel in Part 17. It covers aspects associated with driving and makes reference to current legislation such as the use of mobile phones whilst driving and how the smoke-free legislation affects the use of company vehicles. 13.2 Employees must familiarise themselves with the relevant sections of this policy before driving on behalf of the University. Full details of Part 17 can be viewed using the following link: http://www2.warwick.ac.uk/services/safety/health_and_safety/policy/17/ 14.0 DRIVER TRAINING 14.1 Essential car users may be required to participate in driver training which will equip a driver with skills for defensive driving and to drive in an in an ecofriendly style, helping to reduce fuel consumption, CO2 emissions and the wear and tear of the car. 15.0 MOTORING OFFENCES 15.1 Employees are responsible for paying any fines imposed upon them for motoring offences, including parking offences, which they have committed whilst in possession of a University car or when using a private car for business. 15.2 The registered owner of a University car used by a University employee is the contract hire car supplier. Should the registration number of a contract hire car be reported to, or noted by, the police for any reason, or taken by a speed camera, the police will contact the supplier to establish who is the driver of the car. The University is obliged to supply the name and address of the principal driver to the authorities as and when requested. In some cases the supplier may have to pay a fixed penalty notice and seek to recover this from the University, incurring an administration fee. Before becoming an essential car user an employee must give consent to the University recovering all costs for fixed penalties by deductions from pay, and for any road traffic offences where an employee is subsequently charged and convicted. 15.3 If an essential car user receives fixed penalty points or endorsements to his/her licence, the employee must present the amended licence to the University immediately and a copy will be held on the employee’s personal file. 15.4 In the event of an employee being disqualified from driving, a meeting will take place between the employee, their line manager/Head of Department and Human Resources in order to discuss the potential impact of this on the employee’s ability to carry out their job role. In the case of disqualification, University Car/Car Allowance Policy 9 Heads of Department/line managers may discuss whether the allowance or University car may be withdrawn or continued. The longer the disqualification the more likely it is that the allowance or car may be withdrawn immediately. 15.5 Failure by the employee to notify the University of any motoring offences or disqualification from driving may result in further action being taken against the employee. 16.0 TAKING A UNIVERSITY CAR ABROAD 16.1 Before taking a University car abroad for pleasure or business purposes, the employee must seek approval from the Head of Department. If approval is granted, the employee must ensure that they are in possession of the following documentation: valid UK driving licence certificate of car insurance for cover on business outside the UK form VE103 from for the University car supplier additional Breakdown and Recovery cover for the University car in the event of an accident or breakdown outside the UK – this must be paid for by the employee travel insurance including employer’s liability – provided by the University if for business purposes 16.2 If an employee has to leave a University car in the UK during an extended period of work overseas, they must consult their line manager/Head of Department and Human Resources about the safekeeping of the car while they are away. Please see also 19.1 below. 16.3 An employee who takes their own car abroad on University business must ensure that they are in possession of the following documentation: valid UK driving licence certificate of car insurance for cover on business outside the UK travel insurance including employer’s liability – provided by the University for business purposes additional Breakdown and Recovery cover for the employee’s private car in the event of an accident or breakdown outside the UK – this must be paid for by the employee 16.4 Employees should note that different rules and legislation apply when driving in foreign countries it is the employee’s responsibility to ensure that they comply with the local and national rules and legislation applicable to that country at all times. 16.5 Information and guidance on driving abroad can be found on the following website: http://www.theaa.com/motoring_advice/overseas/index.html 17.0 CHANGE OF JOB ROLE 17.1 When an essential car user leaves his/her job role, the requirement for that role to be designated for an essential car user will be reviewed. University Car/Car Allowance Policy 10 17.2 Employees who are essential car users who change job and whose new role requires an essential car user will be eligible for a University car or monthly car allowance as set out in Section 22. 17.3 Employees who are essential car users and who are promoted to a job which still requires an essential car user and which carries a higher allowance, will continue with their existing University car arrangement until the contract has expired. They will, however, receive a monthly payment with their salary which is equivalent to the difference between their existing level of car allowance and the allowance applicable to the new job. 17.4 If an employee who has been receiving a monthly car allowance changes job to one which does not require an essential car user, the monthly car allowance will normally cease immediately. 17.5 If an employees who has a University car changes job to one which does not require an essential car user, the arrangement to have a University car will normally cease within one month. 17.6 Reviews on an employee’s essential car user status will take place from time to time and if it is identified that the status should be removed the provisions in 17.5 and 17.6 above will apply. 18.0 SECONDMENTS AND TEMPORARY POSITIONS 18.1 Employees who take up a secondment or change roles on a temporary basis will continue with their existing arrangements for both the University car and monthly car allowance, as long as the new job role remains as an ‘essential car user’. If employees take up secondments or temporary positions which do not require an essential car user the situation will be considered on an individual basis. 19.0 ABSENCE FROM WORK 19.1 An employee who is absent from work for an extended period e.g. because of sickness, will retain any University car assigned to them, or continue to receive the monthly car allowance at the discretion of the Head of Department. Employees on maternity leave will retain the University car or car allowance for the full period of their maternity leave. 20.0 SUSPENSION FROM WORK OR GARDEN LEAVE 20.1 If for any reason, the employee is suspended from work, is placed on garden leave or is working a period of notice, the University reserves the right to withdraw the employee’s University car and pay the employee an allowance equivalent to the value for the normal use of the University car instead. In such cases a meeting will be held with the employee accordingly. 21.0 RETURN OF COMPANY CARS 21.1 An employee, who adds optional extras to a University car (see section 4) and leaves the University before the expiry of the contract for the company car, will be required to make a final payment for any additional contributions University Car/Car Allowance Policy 11 outstanding. 21.2 At the expiry of the contract hire of a company car, an employee will have the opportunity to purchase the car from the supplier on a commercial basis. Details can be obtained from the University Transport Manager 21.3 The car must be returned with (where issued): The car handbook, documents and service information; Interior floor mats all sets of keys all safety items supplied by the University such as first aid kit etc any optional extras and standard equipment supplied with the car 21.4 The employee must ensure that they have removed all personal accessories from the car. If the employee considers that removal of any personal accessory could result in damage to the car, they must consult the University Transport Manager. 21.5 A standard allowance is made by suppliers for normal wear and tear on contract hire cars by the end of a contract period, but anything above this allowance will be chargeable to the University when the car is returned to the supplier and will be recovered from the employee. 22.0 MONTHLY ALLOWANCES AND ELIGIBILITY CRITERIA Salary Monthly Grade Contract Hire Allowance inc. Vat 1a to £350.00 5 Monthly Car Allowance CO2 Emissions EuroNCAP Age of Safety Rating Own Car £360.00 < 150g/km Min. 4 stars Max. 4 yrs 6&7 £420.00 £430.00 < 150g/km Min. 4 stars Max. 4 yrs 8 £525.00 £535.00 < 150g/km Min. 4 stars Max. 4 yrs 9+ £590.00 £600.00 < 150g/km Min. 4 stars Max. 4 yrs (includes £10 contribution towards insurance) 22.1 All allowances are subject to review (see Section 1.0 above) by the Reward Manager in conjunction with the Transport Manager. 22.2 A list of qualifying cars is available from the University Transport Manager on request. 22.3 The University reserves the right to withdraw the University car policy and car allowance scheme at any time by giving reasonable notice. University Car/Car Allowance Policy 12 SUPPLEMENTARY DECLARATION IN RESPECT OF ADDITIONAL DRIVERS Insured's/Proposer's full name: The University of Warwick Certificate Number: 25522626 A Full Name (State Mr, Mrs, or Miss) B State Country of Birth (if overseas state how long resident in the UK) State type of Licence(s) held – Car/HGV/PSV Full/Provisional. C D Also State Country of Issue. State Driving Licence Number E State Home Postal Code F State National Insurance Number G Age (State Date of Birth H I Occupation(s) (Full and Part Time) Give details of any conviction or pending prosecution in connection with any motor vehicle and amount of fine including details of any fixed penalty offences. Please state any penalty points or suspensions imposed. J K L If None say "None" State how long regularly driving motor vehicles in the European Union. State how long in each Member State(s) (If only motor cycle or tractor experience please state so). State date on which driving test passed for each type held, eg car/HGV/PSV. Also state Country of Issue State if suffering from: (1) defective vision or hearing (2) now, or within the last five years, from diabetes, fits or any complaint of the heart (3) any other physical or mental infirmity. If so give details. M N O If None, say "None". State Company or Underwriter with whom previously insured in respect of any motor vehicle. If None say "None" State if any Company or Underwriter has ever declined, cancelled or refused to renew in connection with the insurance of any motor vehicle or increased the premium or required the first amount of any loss to be borne or imposed any special condition. If No say "No". Give details of any accident whilst driving any motor vehicle during the last three years and full cost involved. If None say "None". I/WE, the undersigned, do hereby declare and warrant that the above statements and particulars are true and that within my/our knowledge there is no other material fact which should be disclosed. I agree that the University may use these details to confirm my licence with DVLA Additional Drivers signature………………………………………………… ..Dated……………………………………… I/WE hereby agree that this Supplementary Declaration shall, in conjunction with my/our original proposal, be the basis of the contract between me/us and AIG Insurers. Insured's/Proposer' signature...........................................…………………… Dated.............................................. Please return completed form to Andi Poole, Administrative Assistant, Estates Office Confirmation that driving licence has been checked by the Estates Office and is in line with declaration under I above. YES/NO 2 July 2015