Trevrev
Veteran
- Location
- Southampton
Norm said:
I think the fact of the matter is, the company i work for just couldn't be arsed!!
Cycle to Work outrage
- Thread starter junglegusset
- Start date
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I think the fact of the matter is, the company i work for just couldn't be arsed!!
I helped to set up the cycle to work scheme where I work, using CycleScheme:
http://www.cyclescheme.co.uk/
In the process, I've wound as unofficial "cycle champion" at my workplace. The main advice I'd offer is to do as much as you can yourself, so that you're making life easier for the people who need to approve the scheme. For instance, we have various policy documents, covering maternity leave, pension schemes, etc., so we needed one for this as well. I drafted this new document, then gave it to my boss for approval, rather than asking someone else to write it.
The paperwork is pretty simple, particularly if your company already has a salary sacrifice system in place (e.g. for pension contributions). There is a cost to the employer, since they have to pay the cost of the bike upfront. They'll normally be able to reclaim the VAT, but even so that means that for a £1000 bike they'll be paying £870. If you have 50 employees who all decide to take advantage of this new scheme at once, that's £43,500, and some companies may not have that much spare cash sitting around.
On the plus side, the employer won't have to make National Insurance contributions on the sacrificed salary. That's currently 12.8% (at least in my case), so if I sacrifice £870 of my gross salary for this bike then the company saves £111. Hopefully this will outweigh the cost of someone's time in dealing with the admin issues (e.g. modifying payroll).
The "50% of journeys" thing is a bit vague, with conflicting information out there, but as far as I can tell it means "at least half of our journeys must be for work", so if you only use the bike once a month that's fine. I don't think that mileage matters, so if you do a 2 mile commute 5 days a week and then do a 50 mile tour at the weekend that's fine. The employer certainly doesn't have to enforce this, and the employee doesn't have to keep any records. In practical terms, it just means that you can't buy a child's tricycle or a roof rack to put your bike on a car: it should at least pretend to be relevant to your daily commute.
Regarding health and safety, the slight quirk of this scheme is that the employer technically owns the bike, and they are renting it to the employee. The employer might choose to sell it to the employee at the end of the rental period (at "fair market" second hand price, typically 5%), but they can't actually promise that in advance, otherwise it gets treated as hire purchase and there are different tax regulations. It's a bit like the old question of whether Jaffa Cakes count as biscuits or cakes... Anyway, some companies might be concerned about liability in this situation, e.g. if you have a crash because the front wheel falls off, is that their fault? Some people had similar concerns about repaying mileage expenses to cyclists, on the grounds that the company might be considered negligent if they didn't provide safety training etc. In our case, we've made it a specific part of our written policy that the employee is responsible for bike maintenance while they hire it, but I can understand why other companies might be a bit more risk averse.
http://www.cyclescheme.co.uk/
In the process, I've wound as unofficial "cycle champion" at my workplace. The main advice I'd offer is to do as much as you can yourself, so that you're making life easier for the people who need to approve the scheme. For instance, we have various policy documents, covering maternity leave, pension schemes, etc., so we needed one for this as well. I drafted this new document, then gave it to my boss for approval, rather than asking someone else to write it.
TheBoyBilly said:
The paperwork is pretty simple, particularly if your company already has a salary sacrifice system in place (e.g. for pension contributions). There is a cost to the employer, since they have to pay the cost of the bike upfront. They'll normally be able to reclaim the VAT, but even so that means that for a £1000 bike they'll be paying £870. If you have 50 employees who all decide to take advantage of this new scheme at once, that's £43,500, and some companies may not have that much spare cash sitting around.
On the plus side, the employer won't have to make National Insurance contributions on the sacrificed salary. That's currently 12.8% (at least in my case), so if I sacrifice £870 of my gross salary for this bike then the company saves £111. Hopefully this will outweigh the cost of someone's time in dealing with the admin issues (e.g. modifying payroll).
The "50% of journeys" thing is a bit vague, with conflicting information out there, but as far as I can tell it means "at least half of our journeys must be for work", so if you only use the bike once a month that's fine. I don't think that mileage matters, so if you do a 2 mile commute 5 days a week and then do a 50 mile tour at the weekend that's fine. The employer certainly doesn't have to enforce this, and the employee doesn't have to keep any records. In practical terms, it just means that you can't buy a child's tricycle or a roof rack to put your bike on a car: it should at least pretend to be relevant to your daily commute.
Regarding health and safety, the slight quirk of this scheme is that the employer technically owns the bike, and they are renting it to the employee. The employer might choose to sell it to the employee at the end of the rental period (at "fair market" second hand price, typically 5%), but they can't actually promise that in advance, otherwise it gets treated as hire purchase and there are different tax regulations. It's a bit like the old question of whether Jaffa Cakes count as biscuits or cakes... Anyway, some companies might be concerned about liability in this situation, e.g. if you have a crash because the front wheel falls off, is that their fault? Some people had similar concerns about repaying mileage expenses to cyclists, on the grounds that the company might be considered negligent if they didn't provide safety training etc. In our case, we've made it a specific part of our written policy that the employee is responsible for bike maintenance while they hire it, but I can understand why other companies might be a bit more risk averse.
mr Mag00 said:
Used to be by bike... When I was in the RN we always had a Sick Bay Bicycle* - usally a "Red Devil" workbike which we all used. No-one drove at all.
In fact it used to be great for us cyclists as there was actually a cycle workshop, fully equipped for their maintenance.
* NO Comments please.
gaz
Cycle Camera TV
- Location
- South Croydon
I'm not sure if this has been raised yet as i've not read all 30 odd posts in this thread.
But the main issue is that your employers have to put the money up front. so if 1,000 staff asked for £1,000 then that is £1,000,000 a company has to output from there cash flow to buy the bikes. they recover that money over a minimum 12 month period.
But the main issue is that your employers have to put the money up front. so if 1,000 staff asked for £1,000 then that is £1,000,000 a company has to output from there cash flow to buy the bikes. they recover that money over a minimum 12 month period.
Not necessarily.gaz said:
The scheme I set up has a minimum repayment period of 3 months, there's nothing in the rules to say it has to even be that long.
The rules say:
There is no fixed time period for which cycles and cyclists’ safety equipment must be loaned under a Cycle to Work scheme. Similarly, there is no fixed time period for which a salary sacrifice scheme must run where one is used to offset the cost of loaning the cycle and cyclists’ safety equipment.
I am paying back over three but, because I run the payroll and I want to show the boss that it's not a drain, I paid 2 months in the first payment. With that, the reduction in e'ers NI and the VAT reclaim, it's pretty much cash neutral.
I'm also doing it over three months because you can have a couple of bikes a year but only one "loan" at a time (without a credit licence) so I'll be shopping for a Sirrus in January.
gaz
Cycle Camera TV
- Location
- South Croydon
And how many other schemes run like that Norm?
not many, most are set out for a 12 month period.
Your lucky to be in that boat *jealous*
not many, most are set out for a 12 month period.
Your lucky to be in that boat *jealous*
That could add a further complication.....
The fewer repayments the more each repayment will be. If the employees salary is close enough to the minimum wage, he/she would not be able to take part.
(Salary sacrifice schemes are not allowed to reduce the employees pay to below minimum wage)
The fewer repayments the more each repayment will be. If the employees salary is close enough to the minimum wage, he/she would not be able to take part.
(Salary sacrifice schemes are not allowed to reduce the employees pay to below minimum wage)
Some people look for problems! Thinking like this is why so many companies don't take advantage, IMO, so their employees don't get the chance to benefit.Bongman said:
Besides, whilst what you say is true in theory, I wonder if someone on the minimum wage will be looking for a grand's worth of bike, which is the scenario we were discussing.
Crankarm
Guru
- Location
- Nr Cambridge
Cycle haters that's what they are. Feck 'em .
.
shouldbeinbed
Rollin' along
- Location
- Manchester way
Norm said:
a grand was mentioned in a previous post and would seem to be the norm (no pun) for b2w but it doesn't have to be a grand and someone at the lower salary is less likely to have a car or the disposable income usually to lash out £1000 or anywhere near that on a bike, so they could well want to use b2w over a longer repaymnet period to purchase not only their primary form of transport (so generally after more reliability =better quality = costs more money initially) but also something that they'd not be able to afford any other way. A shorter repayment period would make b2w exclusive to those on a better wage, surely against the whole inclusive aim of cycling
I've taken the full £1000 over 12 months and whilst I'm lucky to be comfortably over minimum wage, It would still be a lot for me to pay off in much less than the year with my other living costs.
Read it again. I suggested the shorter loan period as a solution of potential cash outflow if 1,000 people buy bikes for £1,000. I was not demanding it for everyone. I'm the sort who looks for solutions rather than problems, which is fortunate for those who are able to benefit from the Cycle To Work policy at my employers.
If you want me to write your company's policy too, let me know what real and perceived hurdles you've got and I'll sort a policy that can cover all bases (although I bet I can come up with more than you can!) but I'll be looking for at least £200 an hour.
If you want me to write your company's policy too, let me know what real and perceived hurdles you've got and I'll sort a policy that can cover all bases (although I bet I can come up with more than you can!) but I'll be looking for at least £200 an hour.
