Resources to help employers understand the issues associated with employees operating company vehicles on or off duty, such as motor vehicle records checks and wage and hour considerations. These resources include a sample company car policy with important drafting tips.
Employee use of company vehicles on or off duty raises several concerns, including safety standards, liability for injury and property damage, and compensation for vehicle expenses and travel time. Employers should consider implementing a company car policy that clearly addresses the following issues:
Minimum requirements to operate a company car, such as a valid driver's license.
Permissible uses of company cars, including whether personal use is allowed.
Safety standards.
Responsibility for expenses, such as fuel and maintenance.
Mileage and other recordkeeping.
Amount of taxable income for employees, if personal use is allowed.
Use of hands-free devices while driving.
Possession of guns in company cars.
Practical Law has published a sample company car policy that addresses these issues and more. Employers can download Standard Document, Company Car Policy and customize the policy to their particular circumstances.
Motor Vehicle Records Checks
Employers often conduct motor vehicle records checks on employees who operate company vehicles. The Driver's Privacy Protection Act (18 U.S.C. §§ 2721 to 2725) is a federal law that imposes some restrictions on the disclosure of information by state departments of motor vehicles. For more information about obtaining driving records, see Practice Note, Background Checks and References.
State law may impose additional or different requirements on the use of driver information in background checks. For more information on state laws governing background checks, see Background Check Laws: State Q&A Tool.
Company Car Wage and Hour Considerations
Compliance with federal and state travel time compensation rules is often a target of litigation. Determining whether time spent travelling is compensable depends on the kind of travel involved. For example, commuting time to and from work, even in a company-provided vehicle, is generally not compensable working time. However, travel between worksites, same-day travel out of town on business and commuting time in emergency call-back situations is typically compensable.
State guns-at-work laws often establish an employee's right to store a firearm in their locked, personal vehicle. However, many states do not extend that right to vehicles owned or leased by the employer unless the employee must transport or store a firearm as part of his employment duties. For example, North Dakota's guns-at-work law does not apply to any motor vehicle that is owned, leased or rented by the employer or the landlord of the employer (N.D. Cent. Code § 62.1-02-13(6)(e)). For more information on guns-at-work laws, see Practice Note, Guns at the Workplace and State Guns-at-work Laws Chart: Overview.