A French employee was terminated for using his company car to carpool. On a regular basis he had given employees – of other companies – a ride while travelling to and from the work place. He received compensation for these rides but this compensation had been diligently donated to a charity of his choice. To his employer, however, this was not relevant. Carpooling was not explicitly prohibited by the company's car policy, but that was not relevant to him either as he considered such a prohibition to be self-evident.

But is that really so? An employer who puts a company car at the disposal of his employee and allows the employee to use this car during his private time awards a benefit in kind to that employee. How that benefit should be shaped, however, is not determined by Belgian law.

The employer is free to impose restrictions on the use of the car. He decides unilaterally to award the car and is therefore also free to determine the terms and conditions of its use. Quite often these restrictions are in fact imposed by the insurance or the leasing company. In determining the limits of the use of the company car, the employee's obligation of loyalty towards the employer and a legally compliant use as a "prudent person" will serve as guidelines for the employer.

A solid and transparent car policy is therefore of the utmost importance. The car policy should not only determine who may use the car (e.g. are family members also allowed to use the car, can the employee lend his car to a colleague of the same company?), but also under which circumstances the car may be used. For example, thecar policy often prohibits the employee from using the car to give driving lessons or to participate in street races. The employer is also recommended to prohibit any other professional activities with the car. Newspapers have already reported on the first Uber drivers who got caught using the company car (and fuel card) to drive customers around during the weekend.

Liability for damages is another important topic to address in the policy: who pays the first tranche which is not covered by the insurance company, the employer or the employee? As from which accident is the employee required to pay this amount? If the car policy is violated, sanctions may apply, but those sanctions are to be determined by the employee handbook. These sanctions may vary, depending on the gravity of the case, from a (temporary) revoking of the car to a termination with or without cause.

In the absence of (clear) provisions in the car policy, the situation must be assessed in fairness between parties or, if they do not come to an agreement, by the employment tribunal. The Uber driver probably shouldn't count on the sympathy of the tribunal. The case of the carpooling employee, however, is far more nuanced.

In our opinion, a tribunal would take into consideration the fact that there was no car policy prohibiting carpooling, that the employer had not been affected by the carpooling and finally, that the employee had not benefitted either. A Belgian tribunal would probably not confirm a termination for cause. And even if the employee had been terminated with immediate effect and payment of a severance indemnity, he could still attempt to obtain additional compensation for a "manifestly unreasonable termination". Compensation in such cases varies between 3 and 17 weeks of pay.

This article was also published in Trends and Trends Tendances of 12 May 2016 in the Dutch and French language.