Business and Operations
By Diana Coutu
Are company vehicles a good or bad investment?
By Diana Coutu
We’ve had a company delivery car for the longest time.
In fact, we’ve had several over the nine and one-half years that we’ve
been in business.
Are company vehicles a good or bad investment?
We’ve had a company delivery car for the longest time. In fact, we’ve had several over the nine and one-half years that we’ve been in business.
It’s nothing fancy, we’ve always chosen used Toyota Tercels, and they have always served us well. In past, we had the back windows wrapped, using the space to advertise. It was very recognizable that it was our company car, and people knew that Pierre and I were often the ones driving, so in traffic, we’d always get friendly honks and waves.
As our roles changed in our business, my husband and I were travelling a lot more, and the company delivery car sat unused for a time.
We decided that it wasn’t doing any good sitting in our car park, so we loaned it to one of our assistant managers, who didn’t have a vehicle of his own. This person had been working with us for over five years, and we felt like he was part of our family.
The particular car was not yet wrapped, but fully realizing the value of a rolling advertisement, we went ahead with having a new design created for it. When we gave our assistant manager the keys, we agreed that he would pick up some food for the store twice a week, and in exchange he could have the car 24/7 and only have to pay for gas and maintenance. We even continued to pay the insurance.
We calculated that it would take him about 45 minutes to pick up food, so, for an hour and a half of his time per week, he could have a free car. We thought it was a great arrangement, for all.
Needless to say, it was a rude awakening when one day we decided to check his hours and found that he had been late 19 out of the last 25 shifts. Also disturbing was that as a salaried manager he was required to work between 40-45 hours per week … and was barely averaging 37.
After some light digging, it was also discovered that he hadn’t been picking up food regularly, that it had been the other managers who were doing the bulk of the work. Also uncovered was that this assistant manager was picking up his girlfriend on every delivery, driving around with her, dropping her back off at home, all while on the clock.
Enough was enough; our generosity was been taken advantage of, and his duties had twisted into something they were never meant to be.
We pulled him into the office to have a chat. He apologized. He had several reasons for his behaviour, but in reality, they were excuses.
It came down to his mentality – he wasn’t thinking like management. Worse, we were paying him top dollars for skills that he wasn’t bringing into the operation. Managers are supposed to set good examples for others to follow. In this case, his actions gave everyone else permission to show up late, leave early, and do a less than adequate job.
Individuals, as such, are toxic to an organization, especially at the management level. In the particular case, our employee was given a written warning, and we decided to take our car back immediately; it was obvious that having a vehicle wasn’t helping his performance or meeting his scheduled commitments.
Just as he hands over the keys he tells us, ‘the windshield is smashed from a near-fatal accident I had’.
And so it was. Much to our horror, the company car was virtually destroyed.
Inside of two months, this assistant manager had taken a perfectly good pizza delivery car and completely trashed it. What’s more, he wanted to fix the car on his own. The accident in question had happened two weeks prior and it was his intention to fix the car without telling us about it.
He didn’t understand why we weren’t going to let him. He was so concerned about his insurance going up and his licence that he thought we weren’t treating him fairly by wanting to let the insurance handle it.
“Besides,” he said. “It’s only a Tercel, what do you expect?”
It was as if that gave him the go-ahead to trash it.
He was asked to sign a simple agreement, stating that he was responsible for the car – which we should have done before we handed over the keys, but this kid was like family and we hadn’t. He refused to sign it.
The situation got ugly before it got better. We went back and forth with him. He was going to lie about the accident, he didn’t “mean” to wreck the car, he said.
Well, he didn’t “mean” to take care of it either, we said.
He put in his two weeks, citing unfair wage compensation for his job.
Funny, prior to taking back the car, we had cited unfair pay rate for his job performance.
The insurance claim went ahead and as we suspected, the car was a complete write-off. Typically the deductible is taken off the value of the car because the driver is responsible for the deductible. In our case we would have to go after the driver to recover the $500 deductible.
No problem we thought, we could take it off his last cheque. Wrong.
Employers beware: there aren’t any employer’s rights. It seems as though the balance of the scales has shifted completely to the rights of the employees, to the point of abdicated recklessness.
As employers, we are responsible if an employee injures themselves on the job, we are responsible if an employee damages our property, we are responsible for all the shortages, cash and inventory – whether intentional or not. It’s our bank accounts that are on the line.
The week of his last paycheque we got a nasty e-mail and voice mail from a third-party government-funded organization, threatening to sue us if we took any money off of this person’s cheque. It turned out that as an employer in the province of Manitoba, we were not allowed to deduct money from an employee’s paycheque for damaging company property.
Employers, as we learned, are not even allowed to deduct money for cash or inventory shortages.
It’s kind of difficult to hold someone responsible for his or her actions when the government makes it illegal.
This employee took a $3,000 company car and reduced it to scrap metal. In fact, by the time the insurance evaluation was done, it was worth less than $1,400, minus the $500 deductible. Imagine our disbelief as we looked at our $900 cheque for a car that was listed as a $2,500 asset in our books.
It turns out that if we wanted our former assistant manager to pay the deductible of the company car he smashed, we’d have to go through small claims court and sue him. Then we’d have to apply to get his wages garnished. It was an expensive and time-consuming lesson.
Company delivery vehicles can be assets. However, unless you’re the only one driving them, you must also expect them to be a liability.
We thought of our former assistant manager like family, and apparently he thought our company asset was his toy to destroy. If this car had been wrapped, it probably would have done more damage to our reputation than good.
One thing I do know for certain is that it was a huge mistake to lend out a company car for personal use. And I’m not sure I should expect anyone to drive a company car responsibly when at the end of the day the provincial employment laws state that they’re not financially responsible for their actions.
There may be chain pizzerias out there that have fleets of delivery vehicles with a good system for managing them and the subsequent expenses and liabilities they bring. But the reality for most independent pizzerias is that providing delivery vehicles makes it difficult to balance the books.•