Managing fleet risk in the public sector

2009-01-12

New health and safety legislation will have a significant impact on fleet managers, particularly in the public sector if an organisation’s employees use their own cars for work travel, says Nic Paton

Much has been said about the need for employers to manage risk more closely after the Corporate Manslaughter and Corporate Homicide Act 2008 was introduced last year. But there has been little mention of new health and safety laws that are due to come into force this month on 16 January, which will, arguably, have a greater impact on fleet managers whose responsibilities extend to private cars that staff use for work, otherwise known as "grey fleets".

Under the Corporate Manslaughter Act, an organisation can be prosecuted and fined if it is found to have caused a person's death because of grossly inadequate management of work-related driving. However, the Health and Safety (Offences) Act 2008 applies to a broader range of offences and a breach does not need to have resulted in death. The act increases the penalties for individuals who break health and safety laws, raising the maximum fine from £5,000 to £20,000 and broadening the range of offences for which they can be jailed. The legislation could be used to prosecute managers who have, for example, turned a blind eye to driving disqualifications, lack of insurance or poorly-maintained vehicles and an accident has occurred because of one these factors or other management failings.

So it is critical for employers to pay close attention to fleet safety, especially as between one-quarter and one-third of all road fatalities are work-related, according to a report published by the House of Commons Transport Committee in October 2008, Ending the scandal of complacency: Road safety beyond 2010.

Grey fleets should not be ignored, says John Lewis, director-general of the British Vehicle Rental and Leasing Association. "The number of business miles done by private cars has grown substantially, as has the number of private cars being used for business trips. We are also entering a world where it is no longer satisfactory for an employer to simply ask an employee whether they have a valid MOT or that the car has been serviced properly."

Staff use of private vehicles for work is particularly prevalent in the public sector. According to the Office of Government Commerce's Grey Fleet Best Practice Guide, published in June 2008, grey fleets account for 57% of total road mileage in the public sector, equating to 1.4bn miles a year.

Alasdair Tose, transport services manager at Gateshead Council, says: "The road safety implications of a grey fleet are enormous because you can have someone driving a high-end car or something that really deserves to be in a museum."

Gateshead Council, a "business champion" under the government's Driving for Better Business programme, has a fleet of 400 vehicles supplemented by a much larger grey fleet. It has a specific health and safety policy on driving at work, which is included in its employee handbook. "Before you can put in a claim for business miles, you have to make sure your licence and insurance documents have all been checked, that the vehicle has been serviced and, if appropriate, has an MOT," says Tose.

The council also offers certain employees the option of using a pool or lease car.

Whatever policies are in place, they should be clearly communicated to staff and regularly updated. The BVRLA's Lewis says: "The employer should become involved in the trip before it takes place. It might be that you authorise an employee to drive a regular route, but they need to get a new sanction for a longer trip."

When it comes to managing insurance, many policies can be upgraded to business use at a relatively low cost, although this can result in staff using a plethora of insurers. Offering corporate insurance will be taxed as a benefit in kind, and may not be practical for a grey fleet.

Employers may also want to consider identifying the types of motorist who are of particular risk, for example, young male drivers or departments with a poor safety record, and perhaps assess their safety training needs and any cultural issues.

Employers should ensure they have sufficient procedures in place to manage grey fleets so they can adequately defend themselves in court, says Tose. Although it is unlikely employers will ban grey fleets completely, the tougher laws may mean there is more focus on providing benefits to help manage health and safety, such as company cars and insurance, or making those perks already provided, such as mileage payments, subject to strict processing requirements. "As an employer, you have to balance how much control you can realistically have against how much risk you want to manage," he adds.

If you read nothing else, read this...

- The Health and Safety (Offences) Act 2008 will bring in tougher sanctions for firms that flout health and safety on the road.

- Grey fleet risk management is hard to implement and there are no easy answers.

- Employers need a consistent, robust system for checking licences, insurance and MOTs.

- Offering access to pool or lease cars, agreements with rental firms, upgrading insurance and clearly communicating policies can all help.