Claire Evans: Designing and marketing an effective car salary sacrifice scheme

This article is supplied by Lex Autolease  

Making company cars available to all employees via a salary sacrifice scheme is a popular way for organisations to enhance benefits packages.

Claire Evans, Lex Autolease

Lease providers should offer their expertise and support to employers considering a salary sacrifice scheme at every stage of the process, from initial policy designs through to a campaign to reach and inform eligible employees.However, this should not be considered a quick fix for employers. To make such a scheme effective for both the business and its staff, the design and marketing must be carefully thought out

From the outset, it is crucial for all parties understand the difference between a salary sacrifice scheme and a traditional company car scheme. The two types of scheme are complementary and can sit side by side to meet different objectives for an employer, rather than one replacing the other.

Whereas a company car is primarily a business tool, a salary sacrifice vehicle is a way for non-company car drivers to benefit from the all-inclusive package offered by a company car, without the employer bearing any costs. 

Well-designed policies fully consider cost risks

A well-designed policy ought to fully consider the cost risks, such as early termination costs resulting from redundancies, and any statutory pay implications for employees on maternity or long-term sick leave where salary deductions can no longer be taken.

In conjunction with the scheme provider, the organisation should fully model the potential costs of these factors and put measures in place to shelter employers from any cost exposure.

There should also be a degree of foresight when designing a policy, given possible future tax increases for company cars. The impact of such changes on employers’ national insurance savings could be considerable. One way for employers to address this is to impose a sensible CO2 cap on the range of vehicles available, while still offering enough choice to make the scheme attractive for employees. 

Once the design of the scheme has been finalised, full and thorough preparation for the launch is vital. A bespoke marketing campaign is needed to ensure staff have the appropriate level of awareness and understanding of how the scheme will work. 

Successful schemes are backed by targeted promotion

Successful schemes are often backed by targeted and varied promotion in the build-up to their launch. This might include posters or leaflets in offices, teasers in payslips, articles in employer newsletters and communications through email or on internal intranet sites.

Roadshows, run by an organisation’s lease provider, allow employees to drop in and ask questions about the scheme. Then, after the first vehicle delivery, distributing a case study and testimonial to show the experience of a satisfied colleague can be very effective in generating interest from other employees.

The mark of a successful scheme is one that results in ongoing interaction and discussion between the lease provider and employer about its design and marketing, where the employer’s risks are carefully considered and covered, and employees are equipped to make informed choices.

Claire Evans is consultant, strategic fleet consultancy, at Lex Autolease