In brief
A company car use agreement sets out the provision of a company vehicle to a particular person. It applies the general company car policy to the individual case and forms part of the employment arrangements.
What does it cover?
The particular vehicle, the extent of permitted private use, who else may drive it, the allocation of costs and employee contributions, duties in caring for the vehicle, what to do after damage, and the terms for return and replacement.
How does it relate to the policy?
The company car policy applies to everyone who is eligible and sets out the general rules. The use agreement concerns one person and one vehicle and usually refers to the current version of that policy.
This approach is common because otherwise every policy change would require new individual agreements. Whether, and to what extent, such a reference is effective is an employment-law question.
What matters when managing the agreement?
It must remain easy to find. The agreement is signed when someone joins or changes vehicles, then may not be needed again for years, often until an awkward moment: departure, extended absence or a dispute over damage.
It makes sense to store it in the digital driver file, linked to the vehicle, and set a reminder when the vehicle changes because a new car generally requires an updated agreement. The wording itself should undergo employment-law review.
Further reading
Fleet Management Without Excel Spreadsheets
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