Do you have employees driving around town on business matters using their own private vehicles? These typically unmarked cars are what is known as the “Grey Fleet.” These are vehicles not owned or leased by the company. Common examples include:
- Rented vehicles used for business travel.
- Employee personal vehicles used to run business errands or visit clients.
- Vehicles on novated leases (where the company leases it on your behalf and pays for it on pre-tax salary deductions).
- Vehicles where the company reimburses the employee like Uber.
The risk of the grey fleet
Grey fleets can definitely have benefits over managing company-owned vehicles. However, they can also pose problems if not treated like an actual business fleet. At the end of the day, it doesn’t matter who owns the vehicle your employees uses to conduct business. Companies can still be liable or negligent for hiring unsafe drivers.
The National Safety Council reported an example of both vicarious liability and negligence. “An employee was involved in a fatal crash while making ‘cold calls’ as he drove to a non-business-related event on a Saturday night. The firm did not own the phone or the vehicle. The plaintiff claimed that the company was liable because it encouraged employees to use their ‘car phones’ and lacked a policy governing safe cell phone use. His firm settled the lawsuit for $500,000.”
How to mitigate risk?
Employers have the responsibility to ensure that employees and their vehicles are safe and legal when used for work. Not knowing about a driver’s history doesn’t exempt companies from this responsibility.
Follow these best practices to mitigate grey fleet risk:
Assess the extent of grey fleet risks. Ensuring your organization holds details for all those who drive for work is essential, whether there are company vehicle drivers or members of your grey fleet
Develop driver and vehicle policies. A clear driver and vehicle policy will help state the expectations, rules, and obligations for their driving employees. See the Grey Fleet checklist for a guideline on what to include in your policy.
Take a risk-management approach. Checking your driver’s MVRs constantly can give employers a full picture of who should and shouldn’t be driving on behalf of the business. Grey fleet management technologies like MVR Monitoring can help assess unsafe driving behaviors in real-time.
Need help with a solution to better manage your grey fleet? Contact Us.
