How to Stay Safe from HMRC
4 January 18 | By: Jas Jhooty
There are an estimated 14 million grey fleet vehicles on UK roads. Of those, 11.8 million are associated with the private sector and 2.2 million are within the public sector.
Regardless of the reason for the journey – whether your employee is driving to a customer meeting half way across the country or driving to the shop to pick up milk during the working day – they must have, at the very minimum, Class 1 business insurance to cover their journey. Worryingly we have discovered that not all employees have the correct level of cover.
Upon auditing a selection of our clients’ expenses data we have discovered a disturbing trend that up to 21 percent of drivers are failing insurance checks and may not be eligible to drive for work purposes.
Specifically, 12 percent didn’t have business insurance so it is illegal for them to make work-related journeys of any kind. Worryingly, nine percent of drivers that failed our insurance checks had out of date insurance policies meaning they’re not insured to drive at all.
It’s a shocking set of statistics that points to an issue that businesses should not be ignoring. Their employees are breaking the law, either inadvertently or potentially on purpose. In one instance, we discovered that an employee didn’t have a driving licence, yet they were regularly making work-related journeys.
The implications for the employee are fairly obvious; a roadside fine of £300 and six penalty points. If the case goes to court then there is the potential for an unlimited fine, a driving disqualification and the vehicle could be seized and destroyed. However, employers too, can be on the hook for fines and potentially worse, if it’s deemed they haven’t carried out the necessary checks of driving licences, MOT certificates, and insurance documents.
It’s a legal obligation under the Health and Safety at Work Act for employers to check at least once a year that their employees are safe and legally allowed to drive for work purposes. If your employee is in an accident, the Police and the Health and Safety Executive (HSE) may check whether the correct policies and procedures are in place for duty of care within your company and will take punitive action if they aren’t.
These punitive measures could be exacerbated if the HSE finds that businesses are ‘looking the other way’ and ignoring bad driving habits, or if they aren’t proactive in promoting safe driving practices to employees.
Our advice is simple; you need to put processes in place to demonstrate to the HSE that you are meeting your duty of care obligations. Sometimes it’s not very easy for companies to do these checks themselves – MOT certificates, driving licences, and insurance documents should be checked at least once per year for every single driver. For the higher risk drivers – those with penalty points – more regular checks would be advised.
Unfortunately, you can’t stop risky drivers from speeding and you certainly can’t prevent accidents just by checking documents, but it does demonstrate that you do have your employees’ wellbeing in mind. Updating company handbooks to include safe driving advice and guidance will also demonstrate to the HSE that you take your duty of care responsibilities seriously.
There are also a few challenges in checking documents; it’s time consuming and takes up storage space, either electronically or physically for paper copies. And, most challenging of all, sometimes it can be incredibly difficult to determine whether an employee actually has the right insurance cover.
There is also the potential for your employees to push back on having to change their insurance, not least because their premium is likely to go up. Some of our customers cover the extra cost to include business cover and some don’t, the choice is down to the individual company.
If employees do push back on the cover, our advice is to withhold paying out any travel expenses until the employee is covered. If there is an accident with your employee and you haven’t checked insurance cover, or you still pay for expenses then the HSE may well treat the accident under the corporate manslaughter act, which includes personal liability for senior directors.
This is potentially very serious for employers with incredibly serious consequences if adequate checking is not undertaken.
If you want more information on how we can help you to check that your employees who drive their own cars for work purposes have the correct level of insurance cover and also possess a valid driving licence, please do not hesitate to contact us.