How upcoming legislation will impact your fleet

There are many new laws and regulatory revisions ahead, both national and regional, including those related to pay, emissions, validation and leasing. Are you aware of them all?

The next five years and beyond will see a wide range of changes to fleet industry regulation. Here, we take a look at the main revisions and new laws and how they might affect operators.

Health and safety laws, 2016

Companies that breach health and safety laws will face fines of up to £20 million after new sentencing guidelines came into force on February 1.

The move is intended to ensure that large organisations pay higher fines, with penalties having been brought more closely into line with those for economic crimes such as competition law breaches. The guidelines set out procedures that take into consideration the degree of harm caused, the turnover of the organisation involved and the culpability of the offender.

The BVRLA says: “Fleets must ensure they are using well-maintained, safe vehicles. Employees who drive for work should also have their driving licences checked regularly.”

Safer Lorry Scheme extensions, 2016 onwards

London’s policies tend to flavour political discourse; they also have a disproportionate effect upon the many national fleets that run vehicles into the capital. Current developments in London are held up by election purdah at the time of writing, so it is uncertain which of mayor Boris Johnson’s recent initiatives will go forward.

Transport for London (TfL) may extend the Safer Lorry Scheme (SLS), which currently mandates class 5 and 6 mirrors and supports protection for almost all commercial vehicles in London, to include bigger, lower side-windows in the passenger side of large vehicles to protect vulnerable road users. These are often referred to as ‘direct-vision’ windows. TfL suggests they would cost between £1,000 and £1,500 to retrofit.

Freight Transport Association (FTA) head of national and regional policy and public affairs Christopher Snelling says: “This would be worth doing for new vehicles, but it is a bad idea to force retrofits. In the majority of cycling fatalities it would have made no difference and neither does it protect pedestrians. If something like this is introduced simply because it makes people feel better, then safety budgets will be spent on this and not something more useful.”

TfL is also conducting testing with independent labs to verify the effectiveness of technologies such as 360-degree cameras and proximity alarms, and will add such devices to its vehicle prescription if proved to have an impact on road safety. There is no timeline for completion of this testing.

Gender pay gap reporting, October 2016

Regulations covering pay gap reporting duties for companies with more than 250 employees are expected to come into force in October. There are various ways in which this data must be collated and reported but the crucial aspect for the fleet industry is that it struggles to hire women in operational roles. It is possible that this is one way in which the industry could examine its own hiring and progression processes and possibly attract female workers. The Equal Pay Portal is providing tools for employers to begin considering their approach to this at equalpayportal.co.uk/tools/.

According to the Equality and Human Rights Commission, a low-risk pay system is “transparent, systematic, inclusive, well-managed and based on a measurement of job demands”, rather than just job titles, i.e. an analysis of what skills and requirements the job entails. More information can be found at: commercialfleet.org/low-risk-pay

Earned recognition pilot, 2016/17

DVSA’s 2016 business plan says it will “develop the operator earned recognition scheme further to enable deployment following a pilot”. Earned recognition (ER) will be available to operators who voluntarily share data that demonstrates compliance with the DVSA.

How much data and in what format are not yet defined, although DVSA says it will be looking for “the effectiveness of the operators’ transport systems and how they manage drivers speed, driving style, driving time, location mapping, weight […] and brake performance [...] A potential entry requirement for ER is to allow DVSA access to the operator’s tachograph and maintenance records, it is not, however, envisaged that DVSA would have direct access to an operator’s telematics management system”.

It says that driving instructors will also be participants in earned recognition, which may affect in-house or external fleet trainers. The BVRLA and FTA are both working with the DVSA to have their specific codes or accreditations recognised. However, the FTA says it is disappointed that early lists of requirements show ER diverging substantially from O-licensing regulations.

Smart ‘digitachs’, 2018

Regulation (EU) N° 165/2014 defines the introduction of new digital tachographs with better security mechanisms, GPS interfaces, an ITS interface, which will allow the tachograph to link to other transport applications, and, crucially, a remote communication function.

This last aspect means an enforcement officer can identify basic compliance errors from the roadside while the vehicle is moving, including potential security breaches, interruption to the vehicle’s power supply, sensor or motion data, vehicle motion conflict, a lack of a driver card, time adjustment and calibration data. The officer cannot remotely download the data in this way.

GPS function will enable automatic location capture for the beginning and end of the driving period, as opposed to the current units, which only record country of use.

Technical specifications are currently being approved.

BVRLA says: “The new tachograph should be more secure and make fraud more difficult, at the same time reducing the administrative burden on operators.” 

FTA head of licensing policy and compliance information James Firth says the tachographs are a positive move with the potential for making better use of telematics data and more automation. “The lesson we must learn is not to tie the technology too tightly into the legislation,” he says, “because technology can improve quickly while the regulatory process is slow.”

Changes to leasing regulation, January 2019

The new standard brought in by the International Accounting Standards Board, IFRS 16 Leases, brings almost all leases onto the balance sheet.

This will change debt to equity relationships, raise gearing ratios and capital ratios, and will also affect other financial metrics, such as earnings before interest, taxes, depreciation and amortization.

Companies which lease vehicles are advised to start analysing the impact this could have on their businesses now, and will need to produce a set of comparable accounts for 2018.

There are also simplifications that mean leases can  be reported as a portfolio, rather than individual vehicles. Short-term hire vehicles, informal vehicle extensions and ancillary leasing services do not need to be reported. The new rules initially only apply to public sector organisations, or those reporting to International Financial Reporting Standards. This could affect existing and future credit lines or investment including whether to buy or lease vehicles. However, BVRLA chief executive Gerry Keaney says: “Vehicle leasing’s popularity has little to do with balance sheet advantages. Its main value comes elsewhere: sheltering companies from the risk of fluctuating values, providing them with extra flexibility and purchase power and freeing-up precious working capital.”

Van CO2 mandatory targets, 2017

The European Commission wants to reduce the average CO2 emissions of new vans to 175g/km by 2017, with a further reduction to 147g/km by 2020, says the BVRLA.

London ultra-low emission zone, 2020

From 2020 - or 2019 if new Mayor Sadiq Khan's proposals are passed - all vans and trucks will have to be Euro 6-compliant in order to meet the ultra-low emission zone (ULEZ) standard in London. Currently, trucks and vans over 3.5-tonnes gvw need to meet Euro 6 standards or pay a daily charge. From 2020, small diesel vans (below 3.5 tonnes) will have to be a maximum of four years old to avoid the charge of £12.50 a day, and larger commercial vehicles no older than six years, or they will incur a £100 daily charge. The ULEZ will cover the existing congestion charge zone.

FTA’s Snelling says: “This is particularly problematic for vans, for which Euro 6 only becomes mandatory in October 2016. So a van leased today would not be ULEZ-compliant.”

There are several Government-funded feasibility studies on low emission zones taking place with local authorities in the UK. However, Snelling says: “It is an expensive measure, with limited effect, because eventually all vehicles will meet the emissions level naturally. However, we expect Euro 6 LEZs in Birmingham, Leeds, Nottingham, Derby and Southampton by 2019.”

Birmingham and Leeds zones are likely to include vans; the others will be HGV-only. FTA says this will present the greatest problem for regional fleets who cannot swap vehicles between areas.

The BVRLA says the Government should introduce a national framework to ensure common standards across participating cities. BVRLA’s Keaney says: “We totally support ultra low emission zones and believe our members will have a key role to play in delivering efficient cities. What we don’t want to have – and the Government has been reluctant to step up to the mark on this – is a different zone in Manchester, a different one in Leeds and a different one in Bristol. There is every possibility of that happening.”

Jack Semple, head of policy at the Road Haulage Association, says: “We need to better understand the problem they are seeking to solve and whether this is a good use of tax payers’ money. Euro 6 vehicles are popular with operators – in TfL’s words ‘ultra-low emission’ – and are already on the roads in increasing numbers.”

Vehicle design legislation, by 2022

The European parliament has set a date of 2022 for the introduction of radically new heavy vehicle design, which will give trucks crumple zones, longer aerodynamic noses and flaps and better driver visibility. The new design requires greater flexibility in the weight and dimension of vehicles, although the rules say that trucks longer than 18.75 metres can only be trialled within national borders.

The extent to which the UK is involved with these changes depends upon the nature of its relationship with the EU in the coming months and years. Truck manufacturers will not produce products specifically for the UK market, so it is likely that any design changes would be reflected in the vehicles available to UK fleets. However, how much influence the UK market has in shaping such future vehicles will depend upon its ability to negotiate with the rest of the EU.

Customer-driven compliance, ongoing

Mandatory fleet recognition systems, including EcoStars, the Freight Operator Recognition Scheme (FORS), and the Construction Logistics and Cycle Safety standard (CLOCS), will all have a growing impact on fleets, but with customers mandating compliance rather than legislation. London-born FORS and CLOCS have now been rolled out nationwide. Furthermore, FORS is now a commercial operation run by the FORS Community Partnership.

Fleet customers may therefore dictate vehicle specifications and safety standards previously only mandated in London. CLOCS applies to all vehicles at a depot regardless of application; FORS differentiates between trucks and vans. These standards are designed to be progressive, so are likely to change.

In addition, the FTA has launched Truck Excellence, which will audit fleets against their operator licence (see page 43). It is in discussion with TfL to offer a simultaneous audit against the FORS standard should operators want this.

Drink-drive limits

Scotland recently lowered its drink-drive limit to 50mg  per 100ml of blood, which is in line with most other European countries. Northern Ireland is currently consulting on such a move and transport minister Andrew Jones told the commons that he intends to review the effects of  Scotland’s move.

The Department for Transport says it has no plans to review the limit in England and Wales; however, it is likely that pressure will grow to bring the current limit of 80mg/100ml in line with the rest of Europe.

Brexit implications

There is a plethora of road transport legislation, or legislation which directly affects fleet operation, which originates in Europe and which in theory could be amended or discarded.

One example is the Working Time Directive. Although some commentators hope that an exit from Europe could loosen such strictures on UK industry, the Government would need both the political capital and the political will to remove such regulations from the UK statute book. Politically, it is unlikely that any UK administration would relax rules geared toward road safety such as drivers’ hours.

Cabotage rules, which affect how long a hire-and reward truck can work in another European state, may be affected, and supply chains complicated, by new import-export rules which could include tariffs. Finally, the availability of labour and particularly of vocational drivers could be affected if the UK was no longer a party to the enshrined EU rule of freedom of movement for European citizens.