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UKSolicitorJA, Solicitor
Category: UK Employment Law
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Experience:  solicitor
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Hello,I started working at my present company in Jan 2001,

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I started working at my present company in Jan 2001,
The original job offer was a position that included a company car, this was included in the contract Offer stated “entitled to a company car (Mazda 626 or equivalent)”

This was a lease car which was financed by the company, which also included a fuel card to cover all fuel expenses. In 2002 as the company started to grow in numbers they decided to take the company cars off the people who had them, and then gave a fuel allowance up to the maximum pre tax liability. This was originally 45p per mile up to 10,000 miles and then 0.25p per mile after 10,000 miles.

I signed up to the mileage deal on 24/04/02
The first mileage payment was made on 30/04/02

Although on paper it appeared to be a good deal for the company, I was soon realised that it was not the perfect deal for the me (employee) who was to maintain a decent car originally within 3 years old, and all the depreciation cost of running a decent vehicle (although this was never an enforced factor having a 0 to 3 year old car it was an original stipulation of receiving this mileage allowance).

In order to ‘cushion’ this move from a company car the board decided they would fund an allowance upto a certain mileage which was the maximum a company could give pre-tax. For my position it was an allowance of 15000 miles which worked out at around £5250.
This would be paid at the guaranteed payment per month & paid in advance. £435 per month
This allowance was originally given regardless of actual mileage that we had completed.

We also knew unofficially that depending upon your rank or position within company the entitlement was higher
Sales Reps and a Training Manager had a guaranteed 18000 miles
Line Manager 20000 miles etc etc

There is nothing in writing to back the mileage allowance as quoted above.

Moving on the company grew larger and was partly bought out with a finance group owning 49%. Many Managers got promoted to a position which gave them a higher position and a better package, which then took them off this unofficial deal. As a new finance department got slicker, mileage sheets are required to back up the claim at the end of year. Due to my role changing over the years I now find I do not do the 15,000 miles a year but more like 7000 therefore my time sheets were in all honesty made up to make the mileage fit, so that I didn’t end up paying money back to the company. I believe that it is widely understood and accepted

This unofficial deal has been going on for the last 11 years, but things are becoming more uncertain as Senior Management come and go, my feeling is that they may rescind the offer and claim that it was never agreed, and that only official mileage would be honoured. This would mean a loss to me financially as I would now be providing a car with the expense and depreciation that goes with it, whereas before I had a company car or the 15,000 paid on account deal.
There are 3 others in the same situation as myself. The company employs 150+.

Question 1 - Where do we stand with this offer going forward, do we have any rights to maintain this offer or be recompensed?

Question 2 - I have heard of something called Custom And Practice will this help?

Employment Context:-

Something which has been done that way for a while. In particular in employment law your contract of employment can change by custom and practice. For example, it may have become normal to allow staff to go home early on Christmas Eve and a court might decide that this has now been included in your contract of employment by custom and practice.

For example, it may become customary (over a period of time) to leave early on a Friday, or to add an extra day to a Bank Holiday. In order for an entitlement to become established by custom and practice, it must usually be long-standing, uninterrupted, automatically received, expected and well-known.


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Customer: replied 4 years ago.

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Hi Dave,

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Hello Dave,

To answer both your questions, custom and practice does come to your rescue as it means that any unwritten practice with your employers may become implied and part of your employment contract over time even though there is nothing in writing.

If you are challenged about the £15000 allowance or mileage sheets, you may simply argue that they are part of your contract through custom and practice and your employer will be bound to honour them.

Hope this helps
Customer: replied 4 years ago.

Thank you for your answer, it was the answer that I wanted to hear and has made me feel much better about the situation.


What would you advise I do going forward?


Should I try and raise the matter and secure a new deal (I feel sure that I would lose out in this case)


Should I continue to submit my mileage sheets to show 15000 miles or less, building up more Custom & Practice in the process?






You may want to continue the current practice and submit your mileage claims as before, if this is challenged, you can then raise the issue that it is an implied part of your contract through C&P.

Hope this clarifies. Please leave feedback
UKSolicitorJA, Solicitor
Satisfied Customers: 4312
Experience: solicitor
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Customer: replied 4 years ago.

Reference my unofficial deal that has been going on for the last 11 years i.e.getting paid £5,250 tax free per annum for a 15000 mileage allowance that I do not genuinally do.


Well today my company have said they are scrapping this deal and I have been asked to propose a new deal i.e. a pay increase.


Can I ask for a package that equates to the £5,250 based on 'Custom & Practice'?


Currently I only do about 4800miles a year which at 45p a mile is £2,160 so was thinking of asking for a pay increase of £3090 net.


What do you think?

I think your proposal is fine as you have not been asked to justify your mileage allowance in the past.

Make the proposal and see what they say.

All the best