Can we offer employees a car allowance where previously we provided a company car?

Assuming that your company cars are provided as a contractual benefit, moving employees on to a car allowance can be done, but it is not simply a matter of providing the requisite notice. In broad terms, you must first establish whether there is a power in your contracts of employment to vary specific benefits.

These kinds of flexibility clauses are often included in clauses dealing with insured benefits (such as private medical insurance) but may or may not be included in the company car clause.

A flexibility clause is not subject to an implied obligation of reasonableness, so an employer can rely on this type of clause even if it makes changes that are detrimental to the interests of the