Nottingham City Council amends staff travel schemes in response to salary sacrifice changes

Nottingham City Council closed its company car scheme and amended its staff travel benefits to be offered through net pay in order to counteract the loss of tax advantages.

The council, which has 7,000 employees, closed its company car scheme in December 2016 to new members, following the government’s confirmation that it would change the tax and national insurance contribution (NIC) treatment of certain benefits when offered through a salary sacrifice arrangement. The government’s changes came into force on 6 April 2017, with transitional protections for car salary sacrifice arrangements entered into before this date in place until April 2021.

The council’s car scheme, which has approximately 100 current members, was originally introduced in January 2015 to help staff move from old vehicles into new cars. The benefit was particularly aimed at employees such as social workers, who cover a lot of mileage during working hours. Lynn Griffin-Pearce, resourcing and reward consulting at Nottingham City Council, says: “Everybody who has got a car at the moment [is] covered by the grandfathering rights, so no one’s impacted detrimentally, but it means that new joiners can’t join a car scheme.”

Nottingham City Council has also revised its workplace parking scheme to move from salary sacrifice to a net pay deduction scheme. Originally launched via a salary sacrifice arrangement in 2011, the scheme was relaunched in April 2017. The benefit, which is paid back by the employee over 12 months direct from salary, allows staff to park at a reduced rate at both the organisation’s head office car park and other city-centre-based car parks. The parking benefit can be used during normal working hours, evenings, and at weekends.

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The council also offers net pay deduction schemes for discounts on public transport to help support the 50% of its workforce that reside in the city. This includes discounted tram and train passes, as well as a discounted smartcard travel pass that can be used on trams, buses and trains, and works like an Oyster card. These are offered in the same format as a season ticket loan, enabling staff to spread the cost from their pay over a 12-month period.

The council also offers bikes for work, which was implemented from 2008. To support these schemes and encourage take-up, the council introduced facilities such as showers, a drying room, safe bike storage, and lockers. In addition, it provides bike MOTs and services twice a year during the spring and summer, and offers free Ride Wise training to help new or nervous cyclists gain confidence on the road.