Activa Contracts has won a sole supply, full outsourcing fleet deal with Winterbotham Darby that also sees it take on a consultancy role to the organisation’s cash allowance drivers potentially resulting in them opting for company cars following the introduction of new tax rules.
Redhill-headquartered Winterbotham Darby, which has manufacturing sites operating under its Deli Solutions and Alatoni subsidiaries in Clitheroe and Bicester respectively, operates a 40-strong company car fleet and also has a similar number of employees who have opted for a cash allowance in lieu of a company car.
Winterbotham Darby, a fast-growing food business that predominantly supplies own-label chilled food produced in Europe to the major supermarket chains in the UK, historically relied on a broker to supply company cars on non-maintenance contract hire via a number of leasing providers.
However, Winterbotham Darby conducted a root and branch review of its fleet operation and Activa Contracts won the fully outsourced contract hire with maintenance deal in a competitive tender. It has already delivered three new company cars and has taken over in-life management of the remainder of the fleet until renewal.
Following the comprehensive review, employees across four grades of vehicle benefit from an enhanced company car choice based on “effective rental” after VAT recovery with a CO2 emissions cap - 120g/km for the lowest band and 130g/km for the three remaining bands. The fleet of diesel, petrol and hybrid cars operates over a three-year/60,000-mile replacement cycle.
Jacqueline Fowler, Winterbotham Darby’s senior HR advisor, who is in charge of the fleet, said: “Fleet management responsibility has been within the HR team for many years. However, changes in the team gave the company the opportunity to review its entire fleet operation, including the choice of cars available to employees and whether management remained in-house.
“We analysed all the options available and decided that outsourcing management of the fleet gave Winterbotham Darby access to significant external expertise that was not available in-house. What’s more Activa Contracts’ approach enabled the company to fundamentally review our vehicle choice list and further enhanced our duty of care compliance.”
Activa Contracts’ consultancy approach has also seen it undertake two roadshows at Winterbotham Darby’s head office during which it has introduced the company to drivers, highlighted the revised fleet policy and explained the new car or cash allowance tax rules that came into effect on April 6.
The new rules, known as Optional Remuneration Arrangements (OpRA), essentially mean employees opting for a company car in lieu of a cash alternative will pay tax on the higher of the existing company car benefit value or cash allowance given up. However, car arrangements in place before April 6, 2017 are protected until April 2021 and ultra-low emission vehicles - currently those with CO2 emissions of 75g/km or less - are exempt from the regulation.
Activa Contracts’ area manager Sally Lewis said: “Activa Contracts has effectively become Winterbotham Darby’s fleet department taking on the day-to-day management of the fleet.
“At the roadshows, using our ‘business car toolkit’, we were able to clearly highlight to drivers the financial viability of cash or car with all the critical information displayed. The financial outcomes are different for individual drivers due to numerous different factors.
“Employees driving their own cars on business trips continue to prove to be an administrative and compliance burden for many employers. We believe a company car remains exceptional value for money for both employers and employees and limits organisations’ risk exposure. We believe that company car policy changes and the calculations worked through with employees highlight that some will switch to a company car.”
Additionally, Activa Contracts is delivering a full suite of in-life vehicle and driver services to Winterbotham Darby including: accident management and risk management that includes employee driver licence validation and daily rental provision.
Ms Fowler added: “We are delighted with the approach and impact that Activa Contracts is having in managing the fleet and liaising with all of our at-work drivers. Activa Contracts has brought new levels of knowledge and experience, which our employees are benefiting from while the burden of managing and administering the fleet on a day-to-day basis has been eased for Winterbotham Darby’s HR department. The decision to outsource is proving both cost-effective and, importantly, time-efficient for the business.”
Activa Contracts is also managing all documentation relating to the company’s ‘grey fleet’ - employees that drive their own cars on business trips, which includes the cash allowance drivers and a handful of additional staff that do not qualify for a company car. That includes ensuring cars are correctly insured, have current MoT certificates, a Road Fund Licence and undergo scheduled servicing as well as validating drivers’ licences.
Furthermore, Activa Contracts is also working in partnership with Winterbotham Darby on updating its driver handbook to ensure that its meet current best practice standards.
Activa Contracts’ sales and marketing director Lisa Temperton said: “Our consultancy approach has transformed Winterbotham Darby’s company car policy and ensured maximum duty of care compliance. We have also taken away the administration burden and provided drivers with a single point of contact for all their requirements.”