Picture this: It’s Friday evening, and your employee tells you a scheduled vehicle maintenance visit is taking much longer than expected. “Can I take the van home after because it’s getting late?” she asks.
Whether you’re managing a fleet of 5 or 500, figuring out if you should let employees take company vehicles home is tricky. Liability issues might convince you to say no automatically.
But do you want to risk dissatisfied employees? Denying such requests could also delay important jobs, frustrating your customers.
In this article, we break down the 4 most important factors to consider before deciding whether you should let employees take company fleet vehicles home.
Factor 1: Your Employees’ Transportation Situation
How reliable is your employees’ transportation? If you’re operating in a remote area or if your employees live a fair distance away, letting them take a company vehicle home might just be your secret weapon against the dreaded “my car broke down” call.
Also, letting your employees take a company vehicle home can be a perk with a purpose. In today’s competitive job market, offering a take-home vehicle can be the golden carrot for top talent. It’s a benefit that can help your company stand out from the crowd.
There are some caveats you must remember before you hand out those keys though. Check where your employees will park your vehicle. A secure driveway beats street parking in an unknown neighborhood.
Aside from reviewing these arrangements, leaning on telematics to track vehicle usage is a great way of ensuring your company vehicle stays within bounds. Electronic logging devices can give you route information, mileage, and real-time location information.
You can even set up geofences to alert you of a vehicle leaving an authorized area. Pair this with a smart fuel card, and you can automate the prevention of unauthorized employee spending. For instance, define pre-approved routes and fuel stations in an area, and your employees cannot fill up at stations outside that list.
This prevents any chances of collusion or misusing your company’s fleet vehicle.
Remember, it’s all about finding that sweet spot between empowering your drivers and protecting your assets. Get it right, and you’ll have happier employees and a more efficient fleet.
Factor 2: Your Insurance Liability Risks
If you’re considering letting employees take company vehicles home, you first need to dive into the deep end of the insurance pool. And things can get a bit complicated here. Most standard business insurance policies have exceptions regarding personal use of company vehicles.
Say your employee takes a company van home, decides to pick up some milk on the way to work the next morning, and gets a fender bender in the supermarket parking lot. Many policies will look at that scenario and leave you holding the bag, and it’s not filled with groceries—it’s filled with repair bills and potential lawsuits.
Now, you can modify your policy to cover personal use, but (there’s always a ‘but’) be prepared for higher premiums. The insurance company sees extended use as extended risk and will want compensation.
It’s like upgrading your economy ticket to first class—sure, you get more legroom, but your wallet feels much lighter.
Your employees’ driving records could become your new bedtime reading because they’ll impact your premiums. If star employee Steve has a rap sheet of speeding tickets longer than War and Peace, your insurance company will make you pay for it.
You might also have to increase your breadth of fleet insurance coverage. Existing Workers Compensation insurance plans might need some modifying to account for this new scenario.
For instance, check whether you have to compensate workers if they have an accident in your vehicle when off the clock.
Your expanded auto insurance policies might come with maintenance clauses—meaning you’re dependent on your employees parking and maintaining your vehicle correctly. If they forget, and something goes wrong, you’re on the hook.
Diving into the nitty-gritty of insurance policies is as exciting as watching paint dry, but it’s a necessary evil. A little pain now can prevent a major wallet-ache down the road.
Ultimately, letting your employees take company vehicles home can result in great things like increased productivity and employee satisfaction. With the right insurance coverage and policies, you can minimize those risks and sleep a little easier at night—even if your company’s vehicle is parked in someone else’s driveway.
Factor 3: The Employee’s Role
Not all jobs have the same employee transportation needs. For employees working in emergency response roles or those working in remote areas, they’re practically a job requirement.
But before you start handing out keys, you’ll want to draft a company vehicle usage policy that’s watertight. This isn’t just about covering your bases—it’s about setting clear expectations and keeping everyone on the same page.
Set vehicle tracking through telematics integration as the default approach and explain that it’s not about being Big Brother—it’s about being a smart, responsible fleet manager. Combine telematics with a smart fuel card, and you’ll automate several fuel management scenarios.
For example, have your divers check in via SMS to restrict the fuel card’s use only to authorized employees. You can also have employees enter odometer readings and compare them to telematics data. Telematics devices can also track a vehicle’s fuel tank capacity and alert you of excess fuel filled.
(Did you know: Coast’s Fuel Fraud Guarantee protects you from fuel fraud up to $25,000.)
These alerts remove any incentive for employees to fill their personal vehicles with your money. Aside from these controls, set standards for driving history—think safe drivers, no recent incidents, and definitely no felonies. And don’t forget about maintenance and storage standards.
For employees in situations where company vehicle use for personal needs is almost unavoidable, consider splitting usage time. Define work hours when the vehicle will be on the clock and when it becomes personal transportation.
This setup can be tricky to execute. Your employees must log personal use hours and you’ll have to withhold taxes based on the vehicle’s value, since the IRS considers the use of company vehicles in this manner as compensation.
Clearly, you have some pros and cons to weigh here. Take the time to speak to your accountant to understand the tax implications of letting an employee use a company vehicle off the clock and weigh that against the benefits.
Factor 4: Your Ability to Track Fleet Vehicle Usage
Monitoring company vehicles when they’re off the clock is not just about trust—it’s about having the right systems in place to track and manage your assets effectively.
For many companies, regardless of size, implementing a take-home vehicle policy can feel like opening a Pandora’s box of logistical challenges. You’re suddenly faced with a whole new level of monitoring and record-keeping.
It’s not just about where the vehicle is, but how it’s being used, when, and by whom. This level of scrutiny requires time, resources, and specialized technology.
If you’ve got the right tools like telematics systems and fleet management software, you’re in a good position to monitor these new processes. Throw in a smart fuel card integration, and you’re cooking with gas. Many of those manual controls become automated, giving you more time to focus on the big picture.
But installing these systems and getting them to work with your current operations takes time. Take a hard look at your current capabilities and what you’d need to implement to make a take-home policy work. Ask yourself questions like:
- Can your current systems handle the additional tracking load?
- Do you need manpower to manage and analyze the extra data?
- If not, what would it take to get there?
If the cost and effort of monitoring outweigh the benefits, letting your employees take company vehicles home might not be worth it.
Should You Let Employees Take Company Vehicles Home?
So what’s the bottom line? Should you let your employees use company vehicles on personal time? The answer depends on your company’s situation based on the 4 factors we’ve explained above. Take the time to discuss the issue internally and weigh the pros and cons.
Remember that while the answer might be “no” from a liability perspective, your employees could benefit from such an arrangement, helping you increase their and your customers’ satisfaction.
This question is just one of several fleet managers regularly deal with. From fleet monitoring to preventing gas theft, technology like Coast’s smart fuel cards can help you nip issues in the bud and give you more time to focus on building your fleet’s efficiency. Learn how you can stop wasteful spending and get control of fleet expenses with Coast’s fleet and field Visa cards.
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