Reality Alert: An employee at a small community organization leaves in her car to deposit a check at the organization’s bank. While driving there, the employee causes a serious accident, injuring herself and two others in another car. The injured parties sue the employee after finding that her auto insurance doesn’t even come close to covering their medical bills. Since the employee was running an errand for her employer, the organization is brought into the suit. Even though it did nothing wrong, the organization is now on the hook for thousands of dollars.
Personal Vehicle Use by Employees
While this situation is a worst-case scenario, organizations whose employees use their personal vehicles for business purposes take on some serious risks. Whenever employees are driving for their jobs (excluding commuting), the organization can and will be held liable for what happens to them and others if they're in an accident. Employers also may not know the condition of their employees’ vehicles or if they have adequate insurance. This can all add up to an expensive problem.
If employees transport clients or children, the organization should provide and require the use of a company vehicle. This way, the vehicle is maintained by the organization and they can ensure it's safe for the road. The organization’s insurance will also provide coverage for any accidents, eliminating the uncertainty about adequate coverage. But what about employees who don't transport clients? In many organizations, employees regularly travel on business. It may not be feasible for all of these employees to have a company car. So how can organizations manage this risk?
Safety Tips for Employee Drivers
- Screen drivers: Check the driving records of employees who will be driving regularly. If any of them seem reckless, maybe they shouldn’t be driving for the organization.
- Create a safe driving policy: Communicate with employees exactly what's expected of them while they're driving. Emphasize safe driving by developing policies that ban texting or phone calls while driving. Have clear expectations about driving at safe speeds and requirements for not driving while impaired. Making policies known and expectations clear will hopefully result in safe driving by employees.
- Establish minimum limits of insurance requirements: Require employees to provide proof of adequate auto insurance. This will help reduce some of the organization’s liability, as the employee’s personal auto policy usually responds first.
- Establish vehicle standards: An employee with a very old and unsafe vehicle is much more likely to cause an accident. By establishing minimum vehicle standards, employers can try to ensure the employee’s vehicle is safe for the road.
- Ensure the organization’s auto policy is adequate: Make sure the policy covers not just company vehicles, but employees’ personal vehicles that are used for the organization. This is the best way to protect the organization from financial issues if there's a serious accident.