To company car or not to company car: Making the right choice for your needs
31 May 2023 · 3 min
Mieke Van Alphen
People & Culture Manager
Wheels or no wheels? Designing compensation packages can be challenging for HR professionals, but at icapps, we're committed to creating sustainable solutions that align with our values. For instance, rather than implementing an IP ruling which had previously caused some concern, we opted for a mobility budget a few years ago. We take a thoughtful approach to compensations that benefit our employees and our organization.
But what exactly is a mobility budget?
A mobility budget is a benefit that provides employees with a budget, related to the TCO (total cost of ownership) a company would have to pay for a car, to cover sustainable/eco-friendly commuting costs. It offers increased flexibility in transportation modes, cost savings, and sustainability by promoting alternative transport options like public transportation or bicycles.
This aligns with our goal of taking care of 'Our World' (one of our strategic pillars), which emphasizes sustainable practices, from our carbon footprint to how we interact with each other.
Why we didn’t choose ip-ruling
We didn't choose ip-ruling in the past because you give up part of your (gross) salary in exchange for an immediate net increase. But it was always a grey area where official instances indicated that it would be abolished at some point, and that would involve a significant net impact for colleagues.
Freedom of choice is essential
At icapps, we allow our employees to choose between a mobility budget and a company car. We understand that everyone's circumstances are unique and offering options that best fit their needs is crucial. That's why we let our colleagues switch between the two options once during their journey at icapps, as their needs substantially change. Their situation may change over time, making one option more suitable than the other.
I considered opting for the mobility budget since I cycled to work occasionally. After tracking how many times I needed my car for two months (once or twice) and adding the financial aspect to the equation, I gave up my car.
Recently, I had to leave during rush hour, and it only reaffirmed that switching to the mobility budget was the right decision for me!
Head of Sales
The pillars of the Mobility Budget at icapps
Pillar 1: A Car or Mobility Budget
Since we chose to go full electric as far as our fleet is concerned, our colleagues can choose between a well-equipped EV or Mobility budget.
Pillar 2: Sustainable modes of transportation and housing costs
Within this pillar, employees can choose from a whole range of sustainable modes of transportation, such as:
organized shared transport;
Employees who live within 10 km of their workplace can also finance rental expenses or opt for repayments of their mortgage loan with the mobility budget.
Pillar 3: Money
If the mobility budget is only partially spent in pillars 1 and 2, the employee receives the remaining amount in cash. This amount is first reduced by a particular employee contribution of 38.07%. This contribution builds up social rights, including pension rights, except the right to annual leave.
(1. Wat Zijn De Basisprincipes Van Het Mobiliteitsbudget? | Mobiliteitsbudget, n.d.)
I use public transportation (almost) daily and thanks to the mobility budget, I no longer have to worry about buying subscriptions. I use it for trains, trams, and buses, and I can put the remaining budget into my home loan.
The ups and downs of offering this option
Our colleagues who chose a mobility budget over a company car can enjoy greater autonomy over their commute by allowing them to select the transportation mode that suits their needs and preferences at any moment.
Furthermore, the mobility budget promotes environmental consciousness and sustainability. Opting for eco-friendly modes of transportation like cycling or public transport can reduce CO2 emissions and positively impact the environment. Our goal is to prioritize responsibility for our environmental impact, and the mobility budget is crucial in achieving our sustainability objectives.
Of course, every up has a down. Since this legislation is relatively young, changes are still occurring. This is perfectly ok but it challenges us to stay on top of things and communicate changes to our team as soon as we know about them (and about their impact). An effort we gladly put in, in exchange for the positive impact we see on both our carbon footprint and our employee satisfaction.
1. Wat zijn de basisprincipes van het mobiliteitsbudget? | Mobiliteitsbudget. (z.d.).