Another HR / terms of employement poser..

Mike,

I have been through a couple of takeovers in my time. One was essentially neutral, the other raised the barrier for company cars etc (anyone who had one could keep it but anyone subsequently promoted to that grade could not!)

Is that the same thing as a car allowance or is that an option?
What are the personal tax implications?
Have they explained the new terms to you completely and do they conform to the TUPE regulations for employees who are transferred to new Ts&Cs?

I guess your contract of employment just states that you are eligible for a company car under the company scheme at the time. In my days as a wage slave I actually benefited from this as my employer at the time (CSC) changed the rules just as I joined them so I didn't have to have a Mondeo like every one else on my grade. They also, subsequently, changed the length of time you kept it so you had to like it or lump it. There were also complications about topping up the lease to obtain a more expensive car, I didn't go there do to the potential for hassle if/when I left the company.

I'm sure Mr Parry'll gladly charm things out for yer matey !


Fritz Von Slipimaladythough

They're fl<yin in fick & fin, I wonder why ?

Mike

I'm not a legal type let alone a hr type but my first thought was this looks somewhat out of order. How have newco dressed this up? Newco are switching the risk (associated with the lease commitment) to you, the employee.

What does your contract of employment allow for? This could well be a variation of your contract - perhaps a little sweetner should have been offered to you and your colleagues.

I haven't even touched upon the tax issues yet.

Regards

Mike

Simon / Mike

The take over came a coupelof years ago. TUPE and TURERA seem to have been covered as there where no major changes to terms of employment at the time. This change is about to be put into effect.

The comments about liability being put across to us have already been mentioned internally - and from what we can see, we are NOT being incentivised to accept.

Regards

Mike

Spending money I don't have on things I don't need.

It seems to me that the company is effectively disbanding 'company cars'. In which case you have your own car for which you are responsible and when you leave it is still your car for which you are responsible.

If this isn't the case and you're being required to lease a car otherwise you lose out in terms of effective pay, then I think examination by an expert is required.

Paul

Mmmm, sounds like a change to the company car policy rather than a TUPE related thing.

I guess that as they are still going to be financing it then it is still classed as a company car.

What are the tax liabilities though? The lease contract would appear to be between you and the leasing company so you would be liable but what about the amount the company pays you, will that be taxed?

Also would you be liable for any other costs at the end of the lease (e.g. if the mileage was higher at the end of the lease than the agreed mileage. I did more than half of my car's 3 year lease mileage in the first year on legitimate company business alone!)

Who is responsible for insuring and servicing the car (or is the latter included in the lease?)

Are you then restricted to using the 'approved' leasing company, or could you choose your own? They are not all the same.

Is there a car allowance available so that you can tell them to bugger off and you'll sort your own car out?

Mike, It doesnt all have to be bad BUT the exact details do need to be looked into in a little more detail. I for example work for a car manufacturer probably not a million miles away from you! and technically i lease my own company cars! The scheme is excellent and has significant tax benefits for me personally...

It is now quite common for companies to offer cash for car schemes, and if the terms are right it can work well for both parties.. but as i hinted at before the schemes are made or broken in the detail! In some of the schemes ive come across employees basically get a monthly allowance or a cash sum, its then upto the employee what they spend it on... the can either go down a grade and pocket some cash! (eg a civic with a 552 in the boot!!! rather than an accord etc) or add to is and go up the scale.. Leasing type deals are often associated with these types of schemes as some sort of balloon payment scheme is needed to keep the monthly payments in line with the allowance.. the idea is that you sell the car at the end to pay off the balloon.. so if its your money pick something with good residual values!!
You also need to be clear as to what happening with insurance etc...

Feel free to PT me if you want to discuss in more detail.. im not a HR expert, but i know plenty about the leasing end of the deal!

Neil

If yopu're obliged by your terms of employment to take out a personal lease to run a company car it's a stitch up. You should be given a monthly allowance from which YOU chose how to obtain and run a car. Is this perhaps poor communication by the management - if not it could be constructive dismissal?

Cheers

Harry