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Company vs. Personal car

  • 1.  Company vs. Personal car

    Posted 08-14-2019 14:37
    I have a project that is going to require driving for site access and the employee I would like to assign to this project does not have a car.  I've looked into getting a company car, but I don't think it's going to be the right option for us.

    Has anyone had to ask an employee to get a car? How did you handle it and did you offer an incentive/bonus?

    Many thanks!
    Chyanne


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    Chyanne Husar AIA, LEED BD+C
    Principal
    husARchitecture Inc
    Chicago IL
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  • 2.  RE: Company vs. Personal car

    Posted 08-15-2019 17:41
    I haven't, no. If Uber is out of the question, is zipcar an option? Perhaps reimbursed to the client or partially reimbursed to the office?

    JMT

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    Jonathan Taylor AIA, NCARB, LEED AP BD+C
    Senior Associate/Director of Design Implementation
    LLB Architects
    Providence RI
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  • 3.  RE: Company vs. Personal car

    Posted 08-15-2019 17:56
    I don't think asking an employee to buy a car is a reasonable route...especially if mileage and travel are in your contracts as reimbursable expenses.

    Zipcar, Uber, or using rental cars are probably your best options - compare pricing of those 3 options for a given site visit against IRS mileage reimbursement ($0.58/mile) and see which option is the most economical for the client.

    C
    hristian Rogers, AIA
    205-447-1226

    Blackmon Rogers Architects, LLC
    3 Office Park Circle, Suite 316
    Birmingham, Alabama 35223






  • 4.  RE: Company vs. Personal car

    Posted 08-15-2019 19:10
    How often would the person be driving to the site and for how long? I'd be uncomfortable asking an employee to buy a car and even moreso if the travel was infrequent and for a short duration. Depending on the length of the project, distance, and frequency of visits I'd look at some of the rental/ridesharing options on the short end to a lease on the longer end.

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    Thomas Bank AIA
    Principal Architect
    Simply Stated Architecture, P.C.
    Lemoyne PA
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  • 5.  RE: Company vs. Personal car

    Posted 08-16-2019 17:33
    You don't mention if the employee even wants a car with all the attendant extra costs, insurance, maintenance, parking, etc. Do they want to take on an auto loan? what would that do to their credit rating?  Contingent consequences need to be considered.
    I would consider the company purchase a decent used car, get great liability insurance and just let him use it for project-related travel throughout the life of the project then sell it off when the project is over.   I don't think any of us expect our employees to buy workstations, software, plotters, and all the other tools required for the work, we supply them, I think this is a case where you should supply the employee the means to carry out his duties for the company.

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    Mark Domiteaux AIA
    Principal
    Domiteaux Architects
    Dallas TX
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  • 6.  RE: Company vs. Personal car

    Posted 08-19-2019 17:28
    Company owned cars should be carefully considered.

    Understand that if your employee misuses the car (for example, stops off at a bar on the way home, has a few too many and injures someone) your may have liability.  At the least you probably have an issue to defend (injured plaintiffs seek deep pockets and most younger architects don't present that opportunity whereas firms and insurance carriers tend to)

    I generally recommend clients require employees to use their own vehicles and just pay them at the IRS mileage rate.  Of course you need to make access to a vehicle a condition of employment if you expect an employee to travel on their own to client meetings or on field visits, but most employees will seek those things out as they are also a path to advancement (at least the employees you want long term will do that)

    It can be a difficult question but generally speaking keeping business use separated from personal use is the best idea


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    Frederick Butters, Esq.
    Attorney at Law
    Frederick F. Butters, PLLC
    Southfield Michigan
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  • 7.  RE: Company vs. Personal car

    Posted 08-16-2019 03:38
    If travel expenses are reimbursables in your project's Owner-Architect Agreement:

    Uber, etc.
    Or a car-sharing service.

    On a recent project, in part because there was no good place for them to park a company car at their office, a consultant used rental cars to get their staff to job sites.  I think they arranged a standing deal with a car rental business and employees just had to walk a block or two to pick up a car.

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    Joel Niemi AIA
    Joel Niemi Architect
    Snohomish, WA
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  • 8.  RE: Company vs. Personal car

    Posted 08-16-2019 09:58
    We leased her a car as part of her compensation.


    William T. Eberhard AIA, IIDA, Managing Partner
    Eberhard Architects LLC
    2077 East 4th Street, Second Floor
    Cleveland, OH 44115
    v: 216.452.4592
    f: 216.737.9999
    c: 216.513.1300







  • 9.  RE: Company vs. Personal car

    Posted 08-19-2019 19:40
    I see you are located in Chicago that has reliable transportation for the employee to commute to work without owning or leasing a car.  Generally, the employee is expected to get to their employer's office on time by any means necessary.  Then using the same type of transportation be able to get to meets outside of the office and maybe reimbursed for cost for any transportation beyond 10 miles away.  That 10 mile policy was generally in place to avoid nit picky paperwork for reimbursement.  I think I saw where you said the client agreement excluded reimbursement for travel which complicates this issue otherwise the employee could use the most economical and timely mode of transportation to the jobsite from your office and ask for reimbursement to be invoiced to the client.
    So some assumptions, the employee must come to the office each day as they normally do and then go to the daily job meetings.  If it is the intent for the employee to be on the jobsite daily instead of your office then basically you are changing the location they are to commute to and they are responsible for the commute if it is not over a reasonable commute for your area.  As the employer and hopefully a fair employer, considering having a discussion with employee to find an acceptable solution for you both instead of dictating a solution that might not make the employee happy with their employment with your firm.
    1.  They have the choice of declining this assignment because it entails changing where they report to work at their own expense and let someone who has their own transportation have this assignment.
    2.  You can buy, rent or lease a car that stays at the office for all employees to reserve to do their job as needed and end the lease or buyout and sell at the end of the lease.  Hopefully, you can find a lease that coincides with the length of the construction admin.  Of course you have to consider all the added expenses of maintaining a company vehicle.
    3.  Someone mentioned negotiating terms for a rental for the time period.  You will still have gas  and parking expenses.  May Be cheaper to have your own insurance instead of rental insurance.
    4.  If public transportation, uber or some other rideshare is available to the jobsite, just reimburse the employee for that expense.  If you think that is going to be to much or not available, offer the employee a raise so that they could get transportation that works for them.  Raise should cover insurance, tags and any other out of pocket expense for maintaining a car and parking they would not have been spending except to do your project construction admin.
    4.  If you present a vehicle as a benefit for this project and/or considering it being compensation on their W2, Keep in mind they are going to have to also pay income tax on that additional compensation just for transportation for your project.  Please make sure they realize they will be paying additional taxes for this perk.  I got an all expense paid trip to the cayman's from an employer.  It was presented as a company retreat and everyone was going.  It would have been political suicide to decline.  At the end of the year on my W2, I was shocked to see the cost divided equally among all the employees and then additional amount of taxes I had not counted on just to pay for that trip I thought was a free ride and I felt like I had funded others drunken binges in the end.
    Hope you find a reasonable solution for all.

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    Elaine Bright, aia LEED AP
    Owner
    Bright Ventures Architectural Consulting
    Nashville, TN
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