COMPANY CAR ALLOWANCE SCHEME

Transcription

1 COMPANY CAR ALLOWANCE SCHEME

2 Page 2 COMPANY CAR ALLOWANCE SCHEME CONTENTS Introduction & Scope 3 Driving Licence and Insurance 3 Company Car Allowance 4 Terms of Provision 5 High Mileage Car User Compensation 6 Car Allowance Mileage Claims 8 Links and Relevant Legislation 10

3 Page 3 COMPANY CAR ALLOWANCE SCHEME INTRODUCTION & SCOPE This document provides information about the use of automobiles for business use under the Company Car Allowance arrangements. This document applies to all employees within RWE Innogy UK Ltd. DRIVING LICENCE AND INSURANCE Validity If a job requires the employee to drive an automobile in order to undertake their duties, a valid full driving licence must be produced. Only an automobile which meets the requirements of this policy should be used for Business Travel. Insurance Provision Employees must ensure that appropriate insurance cover is provided when using their own automobile on the Company s business. From time to time employees will be asked to produce their insurance certificate for inspection. Inspection Employees failing to produce the above documents may have their car allowance suspended until the documents are produced. Inability to drive If an employee is disqualified from driving by a court or becomes unable to drive because of some injury or disability, they must inform their manager immediately. If an employee has a job where it is necessary to drive in order to carry out their duties and responsibilities, the possession of a valid driving licence is a condition of employment. In these circumstances, loss of a licence may result in disciplinary action. Driver Awareness Training All staff in receipt of a Car Allowance will be expected to attend training as deemed appropriate by the npower renewables Health and Safety Team. At a minimum this will consist of a group driver workshop. Failure to attend appropriate Driver Training as requested by npower renewables could result in the car allowance payment being suspended until the completion of the relevant training. The licence and insurance certificate should be produced for the Manager to check. From time to time, employees will be asked to produce their driving licence and insurance certificate for inspection.

4 Page 4 COMPANY CAR ALLOWANCE SCHEME COMPANY CAR ALLOWANCE Allowance Eligible employees will be provided with a taxable cash allowance, paid monthly, that they may use towards funding the provision of an automobile. Basis of Allocation The contract of employment will specify whether the allowance is granted on a Job Need or Status basis. The HR department keeps a list of roles that qualify for a car allowance. Recruiting managers should consult with HR if a new role is not on the list to judge whether the job need requirement is met. Eligibility Eligibility for the Company Car Allowance is at the discretion of the Company taking into account the following principles: Type of allowance When awarded New Job Need Allowances The allocation of a new Job Need Car Allowance to a role must be supported by a business case. Each business case will be approved by the relevant Business Director in conjunction with the HR Manager. Job Need Job Need - 4 WD Status The Allowance is awarded where an employee holds a role which has been defined by the company to require a car. The Allowance is awarded where an employee is required, by the Company, to have a 4 Wheel Drive automobile due to the nature of their role. The Allowance is considered necessary when the employee has responsibility for and cause to regularly visit off road locations which are greater than 25 miles from the employees base location. The Allowance is awarded to all staff in grades ML1 to ML5 inclusive, where it is considered an appropriate and necessary part of the remuneration package. Level of Car Allowance The level of Car Allowance is set to enable the employee to properly maintain and insure their car. The Allowance is not intended to cover the full cost of providing a car. As a guide to determining the Allowance, the Company has assumed that the employee will use a Personal Contract Plan arrangement with the maintenance option, although employees may prefer to choose alternatives, such as purchasing a new or second-hand car, provided the Car Allowance terms of provision are met.

5 Page 5 COMPANY CAR ALLOWANCE SCHEME In addition, the current tax treatment has been factored into the calculation of the Car Allowance which takes into consideration the employee s ability to reclaim monies from the HM Revenue & Customs, i.e. the difference between the current Company business mileage rate and that allowable by the HM Revenue & Customs under the Approved Mileage Allowance Payments scheme. Note: It is the employee s responsibility to claim these monies from the HM Revenue & Customs. Allowance rates The allowance awarded is based on an employee s grade as indicated in the table below: Grade Annual Allowance ML3 8, ML4 7, ML5 7, Allowance per month Hold a full valid driving licence, where you are able to drive in the UK Provide an automobile suitable for business use 1 which scores at least 4 stars on the European New Car Assessment Programme (Euro NCAP) safety programme ( Should the Euro NCAP safety programme change the current star rating system then the star rating requirement will be reviewed by the Company. At any point should the employees vehicle fall below a 4 star rating they will be obliged to replace their vehicle with one which meets the requirements. In both the above circumstances a grace period of 6 months will apply before the employee is obliged to upgrade their vehicle. Provide business insurance cover Provide GAP insurance cover (Personal Contract Plan arrangements only) Provide an alternative automobile, whether through insurance or hired at their own expense, if their automobile is temporarily off the road and they are required to travel on company business. PC1/PC2 6, All other grades 4, Submit business mileage expense claims in line with the company s Expenses policy. 4 Wheel Drive 8, TERMS OF PROVISION Suitable 4 Wheel Drive Automobiles An employee who receives a 4 Wheel Drive Car Allowance will be obliged to provide an automobile meeting the following requirements: Car Allowance Wheel Drive An employee who receives a Car Allowance will be obliged to: 1 Please see Suitable 4 Wheel Drive Automobiles Section

6 Page 6 COMPANY CAR ALLOWANCE SCHEME Increased Ground Clearance (minimum 175mm) Doors Seating Capacity for 4 adults Tyres suitable for the terrain with appropriate sidewall support (e.g. not low profile tyres) Luggage capacity of at least 500ltr for equipment Long-Term Sickness Absence Employees in receipt of a car allowance who are absent due to long-term sickness absence will continue to receive their full car allowance whilst they are in receipt of company sick pay. When an employee exhausts company sick pay, then the car allowance will be suspended. Removal of Job Need Car Allowance Managers will review the roles which are entitled to a company car annually. In the event a role is no longer deemed to require a car allowance the Car Allowance will be removed. In such circumstances the employee in the role will be given six months notice that the Allowance will cease, during which time the monthly car allowance will continue to be paid. Part-Time Employees Part-time employees or who are eligible to receive a car allowance, will receive the full car allowance value appropriate to their grade. Resignation or Dismissal If an employee resigns, or is dismissed, from the Company, the Car Allowance will cease with effect from the employee s date of termination. Redundancy, Ill Health Retirement or Death in Service No compensation will be paid to employees in relation to Car Allowance in the event of redundancy, ill health retirement, normal retirement or death in service. HIGH MILEAGE CAR USER COMPENSATION Maternity Leave Employees in receipt of a car allowance who take maternity leave will continue to receive the car allowance throughout the full period of maternity leave. Overview A small number of car users within the Company are required to travel significant mileage. Where this level of mileage is an ongoing job requirement, additional support over and above the monthly Car Allowance is available.

7 Page 7 COMPANY CAR ALLOWANCE SCHEME Eligibility An employee who travels in excess of 18,000 business miles per annum, between 1 April and 31 March each year Pro-rata claims for part-year eligibility will not be accepted. Claiming Compensation Claims for high mileage compensation must be submitted annually, relating to the period 1 April to 31 March each year, using the following procedure: Stage Description Responsibility Compensation The Company will compensate an employee for the additional mileage incurred as a result of their high business mileage, over and above 18,000 business miles per annum. This compensation is an additional mileage supplement, based on the employee s actual mileage in excess of 18,000 business miles per annum. Calculation of Compensation Each year the mileage rate for the additional mileage supplement will be calculated, based on the motoring costs for the period. This rate will be applied to all high mileage claims. Compensation Payments Compensation payments will be paid via payroll, subject to normal statutory deductions. The actual compensation payment amount paid will be grossed up to ensure the employee receives the full amount of compensation. 1 Employee travels more than 18,000 business miles during period 1 April to 31 March. 2 Employee submits high mileage claim, using the high mileage claim form, detailing total business mileage during the period. 3 Line Manager authorises high mileage claim and passes to HR Department for payment. 4 HR Service Centre ( HRSC ) via an HR Query form or by dialling 166 internally ( externally)arranges payment in the next available payroll. 5 Requested payment is grossed up to ensure net amount received is equivalent to high mileage compensation value. Employee Employee Line Manager HR Department Payroll

8 Page 8 COMPANY CAR ALLOWANCE SCHEME High mileage claim forms must be submitted by 31 May each year. The current reimbursement rates for business miles are: Employee s Responsibility It is the employee s responsibility to: retain their own personal mileage records, based on the mileage submitted via expense claims; to submit high mileage claims within the policy timescales. Manager s Responsibility Fuel type Petrol Diesel LPG 4WD Rate 20 pence per mile 18 pence per mile 12 pence per mile 30 pence per mile It is the line manager s responsibility to review all high mileage claims in order to understand the business requirement for the employee to travel in excess of 18,000 business miles and, where practicable, to reorganise the employee s duties to reduce the employee s mileage. Mileage Rate Calculation The mileage rate formula is based on published AA motoring costs and average fuel prices. This mileage rate calculation may mean that rates are reduced as well as increased. CAR ALLOWANCE MILEAGE CLAIMS Policy The Company will reimburse employees in receipt of a Car Allowance for the business mileage that they incur when travelling on business. Mileage rates Mileage rates are reviewed annually and rates are effective from 1 April each year. Mileage rates are paid to reimburse the cost of petrol or diesel, oil and any top-up fluids. Applicable Journeys Employees in receipt of a Car Allowance may claim mileage for business travel, which is defined as journeys an employee has to make in the course of doing their job. Ordinary commuting travel, between the employee s home and their normal place of work may not be claimed for. Reducing Business Mileage RWE Innogy UK Ltd seeks to encourage environmental practices wherever possible, but this must be balanced against operational requirements.

9 Page 9 COMPANY CAR ALLOWANCE SCHEME Employees travelling on business journeys are encouraged to use public transport or car sharing wherever possible. Mileage Allowance Relief The Company expects employees to claim Mileage Allowance Relief under the HM Revenue & Customs Approved Mileage Allowance Payments scheme for the difference between the RWE npower renewables rates and the HM Revenue & Customs Approved Mileage Allowance Payment rates. The current Approved Mileage Allowance Payment rates are 43 pence per mile for the first 10,000 miles in a tax year and 23 pence per mile thereafter. Tax relief is available on the difference between these rates and the amount that the Company pays. Employees should maintain their own mileage records and submit claims for Mileage Allowance Relief on their Self Assessment Income Tax form.

10 Page 10 COMPANY CAR ALLOWANCE SCHEME LINKS AND RELEVANT LEGISLATION Payment of salaries Recruitment and Selection Expenses Policy Driving Section Health and Safety website Redundancy Retirement Sickness Policy Maternity Leave and Pay Termination of Employment Policy High Mileage Claim Form see forms page

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