When a company provides its employees with a company car, it can be a great perk. It allows employees to have access to a personal vehicle without having to bear all the expenses that come with owning one. Although it can be an attractive benefit, it is crucial to have a company car agreement in place to ensure that everyone is clear on the terms of use.
A company car agreement is a legal document that establishes the terms and conditions of the company-provided vehicle`s use by the employee. The agreement should detail the following:
1. Authorized use: The agreement should detail the authorized use of the company car, such as commuting to and from work or using it for business purposes. This helps set boundaries and prevents misuse of the vehicle.
2. Maintenance responsibilities: The agreement should mention who is responsible for the upkeep and maintenance of the vehicle. The company might cover costs such as oil changes, tire rotations, and regular maintenance, while the employee could be responsible for detailing and cleaning the car.
3. Fuel expenses: The agreement should state who is responsible for fuel expenses. The company might choose to provide a fuel card for business travel or require the employee to keep receipts and submit them for reimbursement.
4. Insurance: The agreement should specify who is responsible for the car`s insurance coverage. The company might have a policy in place that covers the vehicle, or they might require the employee to have their coverage.
5. Mileage tracking: The agreement should outline how the company tracks mileage. This helps the company keep tabs on the car`s use and mileage expenses.
6. Termination of agreement: The agreement should state what happens if the employment relationship ends or if the employee loses their driving privileges.
A company car agreement helps define the expectations and responsibilities of both the employer and employee. It is essential to ensure that everyone is aware of these expectations upfront to prevent misunderstandings or disagreements.
In conclusion, having a company car agreement in place is essential to prevent confusion and ensure everyone is clear on the terms and conditions of the company-provided vehicle`s use. It is a legal document that establishes the expectations and responsibilities of both the employer and employee. By having a clear agreement in place, everyone can drive stress-free.