Company car

Can a company car, which is also used for personal purposes, be reclaimed from an employee who has resigned and is exempt from the notice period?

The notice period is the period of advance notice that you and your employee must, in principle, observe in the event of the termination of the employment contract following dismissal, resignation, etc.

If you exempt the employee from serving their notice period, you must pay them compensation in lieu of notice based on the wages, bonuses and benefits the employee would have received had they worked during that period.

Even if the employee is no longer performing their duties, the contract continues until the end of the notice period.

Exemption from the notice period: the return of the company car

A company car constitutes a benefit in kind for the employee if they have permanent access to it for private use.

Where the employment contract specifies that the company car may be used for personal purposes, you cannot unilaterally decide to withdraw the provision of this vehicle. The withdrawal of such a benefit is treated as a reduction in the employee’s contractual remuneration.

You cannot demand the return of a company car provided for both business and personal use before the end of the notice period, even if the employee has been exempted from working during that period.