New protection for employers with salary sacrifice for EVs scheme

Businesses deploying an electric vehicle (EV) salary sacrifice scheme through The Electric Car Scheme will now have access to a complete risk protection package.

The package will protect employers from having to pay any extra fees should an employee leave unexpectedly.

The Electric Car Scheme says that concerns still exist within businesses as to the costs and practicalities of implementing salary sacrifice, with risk of early termination fees among the areas holding them back.

For example, in the event that an employer needs to make an employee redundant, the company could incur a fee equal to 50% of the remaining car lease costs, which could amount to tens of thousands of pounds, it says.

Taking significant financial risks, even when offering substantial benefits, is often seen as a blocker for a company to offer a salary sacrifice scheme to employees, according to the benefits provider.

Recent research conducted by The Electric Car Scheme found that 90% of businesses believe that there is a significant risk in having an electric car scheme as an employee benefit.

The new Complete Risk Protection Service from The Electric Car Scheme ensures the employer is protected, it says.

Electric Car Scheme CEO and co-founder, Thom Groot, explained: “We want to make it easy for companies to say ‘yes’ to offering electric car salary sacrifice as a benefit to their employees.

“Financial risk is understandably a big deal for companies. By offering The Electric Car Scheme with Complete Risk Protection, we can create a ‘no brainer’ decision for companies and their employees to transition to net zero.

“This is a huge step for the scheme, one that will make it even more attractive to employers and employees alike.”

The Electric Car Scheme’s Complete Risk Protection Service protects the employer from any shortfall due to employee resignation, redundancies, dismissals, long term sickness and family friendly leave.

A new feature even protects employers if the employee doesn’t repay the company for damage to their car.

Chris Heather, shared services director at TopCashback, said: “One of the concerns we had was the liability the business would incur should an employee not be able to meet their financial commitments or leave the business, potentially risking in excess of £10,000 per car.

“As a result, we had decided not to progress with an electric car salary sacrifice scheme, until The Electric Car Scheme told us about their risk protection offered, which was not something we had come across before.

“This made us feel much more comfortable that these risks were mitigated, so we were delighted to offer our staff the significant savings to help access electric cars in a more affordable way, knowing that we didn't need to worry.”