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Context:

I have been working at a consultancy bureau as a software engineer for over 2 years in the Netherlands. The company gives each employee a company car which can be used for both business and personal matters. A new employee starts with a basic car, but after 2 years of working, the company provides the employee a better (larger, more options, better engine, ...) car.

Situation/problem:

Two colleagues and I started in January 2016 and have now been working for over two years. The two colleagues got a mail in January this year from the management stating that a new car had been ordered and would be delivered soon. I hadn't heard anything yet, but expected a mail soon because I had been working for two years as well.

After a month of silence I decided to mail the management myself and ask what the situation was. A few days later they mailed me back saying they forgot me due to "administrational reasons" and that they would order a car for me soon.

Recently I received a new mail about the car that is ordered and would arrive soon. However, because of recent "price changes" at the lease company, the car I would get would be one with a lot less value then what my colleagues have. What I mean by this is that the car I'm getting has far fewer options than theirs, a far weaker engine and just overall isn't as good as theirs. On paper it's also a lot cheaper (about 7k € cheaper), but I don't know how the lease company calculates that.

This really bothers me because we all studied together, started together, got the same salary and do the same job. (I don't know if this matters, but I was also praised for my performance during the last evaluation meeting). I just feel like this is completely unfair to me, while I could have got the same car as my colleagues if the management hadnn't forgotten about me. Sadly the car has been ordered and the management is not thinking about changing it.

Question:

Would it be a good idea/reasonable to ask for compensation for the cheaper car? (For example by raising my salary.)

To clarify: the car I'm getting is not a bad car, just not as good as what I should have got. But the real problem for me is that I'm not getting the same treatment as my colleagues on this matter.

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    Comments are not for extended discussion; this conversation has been moved to chat. – enderland Apr 29 '18 at 15:24

10 Answers 10

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Would it be a good idea/reasonable to ask for compensation for the cheaper car?

No, I don't think this is a good move on your part at all. Your company doesn't control the cost of automobiles, and does not have an unlimited budget for compensation.

In this case, I would enjoy the newer car and move on. This really isn't a big deal in the grand scheme of things. You don't want to seem like an ungrateful or petty person by making demands that are IMHO not reasonable.

And equally as important, they are not being complacent about your situation; they are getting you a newer nicer car....

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    I agree of the cars all cost the company the same. But if the purchase prices differ €7k, I too would be very curious how/if the lease price suddenly changed that much. So I would be inclined to ask for the lease contracts of your car and that of the colleagues. – nl-x Apr 28 '18 at 7:18
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    The problem with this answer is that it misses the point of the question, which is not "his car is better that mine" but rather "I was treated unfairly". The car might not be a big deal in the grand scheme of things, but the unfair treatment is a big deal. – Mehrdad Apr 28 '18 at 8:06
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    @Mehrdad it's only 'unfair' because the OP is comparing the car, whereas the company is spending equal amount of money. Contractually it is perfectly fair. There's no way to solve this. So the company forks over 7000 pounds for the same car, then the other two will complain it isn't fair. There's no way to win. – Nelson Apr 28 '18 at 10:44
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    @Nelson: No, that's not how it works. It doesn't matter one bit whether the company is spending less, more, or the same amount of money. That's the company's problem, not his. What affects him here is what he gets in return for the company's spending, and if he's getting significantly different value in return for equivalent work, he's being treated unfairly. Even if the company is spending $1 million/year on him to give him half the same perks that they give others for $10k/year. – Mehrdad Apr 28 '18 at 11:01
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    @Mehrdad then write an answer and let the people vote on the solution. – Nelson Apr 28 '18 at 11:32
37

First, we need to establish: under what premise is the car being provided? Sometimes, "company car" indicates a vehicle provided by the employer, strictly for performing job duties. Other times, the same phrase can mean a vehicle that is provided for job duties, plus for the employee's personal use, as part of a compensation package.

This is a significant difference in terms of answering your question, because it gives us the terms against which you would decide if (or how) to negotiate the specifics. If you're being provided a vehicle strictly to perform your job, you don't really have much ground on which to negotiate for a "nice" vehicle. The employer is basically responsible for providing a vehicle that gives you the transportation you need, and engine size or fancy options aren't really going to come into play (because as has been pointed out in comments, you can get from A to B with a basic car the same as with a fancy one). If, however, the vehicle is provided for personal use, as part of your compensation package, then you and the employer need to agree on the terms under which the vehicle is selected and provided, the same as any other type of compensation - vacation days, salary, etc.

In the question, you stated,

The company gives each employee a company car which can be used for both business and personal matters

So, it's your impression that the vehicle falls under your compensation package, and is not strictly provided for job duties. This means it's up for negotiation and/or should be stipulated under a job contract the same as any other form of compensation.

Which raises the question: Does the vehicle provided count as "acceptable" compensation? When it comes to other forms of compensation, this is more straightforward: You agree on a specific number for salary, and it's obvious if you're getting that number or not. You agree on a certain number of vacation days, and that's the number you're getting. This makes it easy to negotiate: you can work with the employer on what the number is. It also makes it easy to validate: you look at your paycheck and you know if they gave you the right salary or not.

For a vehicle, it's less clear. At least, it's less clear based on the information you've provided. You stated,

A new employee starts with a basic car, but after 2 years of working, the company provides the employee a better (larger, more options, better engine,...) car.

It's hard to decode this statement you've made. Is it written into your contract or job offer that you get a specific vehicle after 2 years? Is it written that you get a specific value (ie a vehicle that has an MSRP of $X)? A vehicle with a specific monthly lease payment? ($X per month)? Or is that just an informal agreement that has no specific definition?

Let's get back to your question:

Would it be a good idea/reasonable to ask for compensation for the cheaper car? (For example by raising my salary.)

The best way for us to answer your question will depend on those factors:

If there's an agreement that states you get a specific vehicle, defined a certain way, after 2 years, then this becomes easy: you can point that out and negotiate appropriately. Ask for a raise based on the discrepancy, or ask for a better vehicle. But based on the fact that you're asking here, I'm assuming that's not the case.

So: the real problem appears to be, there's a component of your compensation for which you have no specific definition. You think you were supposed to get a specific vehicle, the employer is giving you one based on what they think you're supposed to get. You're defining value as the MSRP, the employer is defining it based on the lease cost.

It's very common for vehicles with vastly different MSRPs to lease for the same monthly payment based on other factors (residual value, differences in interest rates, mileage included, brand or dealer promotions only good for a certain timeframe, etc). So it's no surprise that your definition of value is different than the employer's.

You've already pointed this discrepancy out to the employer, and they explained it - the lease cost determines the car you get. I don't think you pointing it out was unreasonable, but you've already had an answer. At this point, since there is apparently no formal definition of the value of the vehicle as part of your compensation, and the employer has explained how they determine the value, there's not much on which to base your argument for additional compensation. "would it be a good idea" or "what do you think I should do" questions don't really fit the Stack Exchange model well, but in this case, it seems pretty clear that it would not be a good idea to push the issue further, unless you have some grounds on which to do that which you haven't mentioned here.

  • Netherlands, junior software engineer, car provided by the company? There's no question about the premise given the context. This car is without a doubt available for private use, and this is definitely counted as part of the compensation. And yes, as part of the compensation it's entirely negotiable. It's not like the employer is going to just replace him, on the current Dutch labor market. – MSalters Apr 28 '18 at 20:50
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    @MSalters - while good programmers are scarce, juniors are aplenty. – Davor Apr 28 '18 at 21:26
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    @Davor: In the Netherlands? No. The last 4 juniors we hired were a Belarussian, one German/Russian, another German, and a Spaniard. We've approached a Romanian software engineer already living in the Netherlands, but she got an offer from a much larger company. And it's not that we're shunning Dutch, the senior team is all Dutch. – MSalters Apr 28 '18 at 21:50
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In my experience company car benefits like this are generally expressed in terms of a monthly lease cost rather than the retail price of the car. So if lease costs have risen between the company signing up for your colleague's cars and ordering yours then they could easily be paying essentially the same amount for your "lesser" car as they are for the other two.

If this is the case and the policy/contract is worded to the effect that it is the lease amount that is the benefit then I don't see that you are going to have much recourse with the employer. They aren't treating you any worse than the others at your level it's just that the timing screwed you over and if they were to raise your salary or otherwise compensate you then it's going to result in them spending more on you than your peers, who in turn might feel hard done by and so on.

The fact that it was their administrative error in delaying the ordering of the new car is about the only point you could make really - and while I fully agree that it's pretty rubbish that you lose out through no fault of your own I'd question whether this is really a stand worth taking. Genuine mistakes do happen and if you make too big a deal of it then that may reflect poorly on you.

  • Do you really think the leasing company changed their pricing to be 7k€ more expensive for a lesser car? Sounds like they would be losing a lot of business. – GrumpyCrouton Apr 27 '18 at 15:56
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    @GrumpyCrouton In my experience (UK) List price has only a tenuous relationship to leasing costs to be honest, there are many other factors that go in to making it up so I'm inclined to think the €7k difference in list price of the car is a red herring. – motosubatsu Apr 27 '18 at 16:40
  • Hmm, okay. I don't have any experience with this – GrumpyCrouton Apr 27 '18 at 16:49
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    I would add that it's probably worth (gently) making sure management is aware of the problem and that it was due to their error, even if you don't push for immediate action. Even if they can't do anything about it now, they can make up for it the next time you're due for an upgrade. – bta Apr 27 '18 at 17:48
  • In my car shopping past, I have seen several thousand dollars difference in total cost for a car based on lease vs purchase. This was the same car at the same dealership. Who knows what incentives (or lack thereof) goes into the leasing deal. – cdkMoose Apr 27 '18 at 18:43
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Background: I'm Dutch, working in the software industry as director of R&D, and we're hiring. I don't want to imply we're looking to hire you specifically (besides, we usually don't offer cars), but I am very much aware of the current state of compensation. And I've driven lease cars on arrangements very much like yours.

The first surprise would be that you got a "new" car after 2 years. The standard lease periods in the Netherlands are 3 or 4 years. I suppose you didn't get a brand new car when you started. That's common for starters in the Netherlands; the first car may be a left-over from an employee that quit.

Anyway, new car. HR ordered two, and didn't order one for you. At this point, things get a bit fishy. They order cars? Without asking you? I've heard of companies that had forbidden brands. I've even heard of companies that had restricted the choice to a few specific brands. And some may add restrictions like "no cabrio".

Now if you would have been a service mechanic, Dutch companies might have given you a company car with company logo, and they would have chosen everything. That is not the custom higher up in the labor market, neither at consultancy firms nor for software engineers. What you usually get is a lease budget - say €700/month - and an indication what that can get you. For your position in the Netherlands,t he full expectation is that you choose.

Mind you, I just checked (https://gathering.tweakers.net/forum/list_messages/1811481/last) what a typical Dutch lease car budget would be today, and 700 euro/month would be on the low end. If that's offered, don't take that offer right away.

And that's basically where I'm getting with the advice. Time to look for job offers. In the current Dutch market, it's fairly easy to find a new job as a software engineer. Leaving after two years isn't seen as bad (for a starter), having a pretty good reason (HR choosing cars for you without asking) doesn't hurt either.

BTW, that "prices have risen" story? Wrong. There's a microkernel of truth (sorry, software joke there). In September 2018 the Dutch prices of new cars will rise as taxes will be based on the WTLP emission figures, instead of NEDC. Those emission estimates are more realistic and significantly higher, thus the taxes will be higher as well. That almost certainly does not apply to you. Since car companies know this, they aim to get deliveries in by August.

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If they really messed up due to administrative reasons (as you mentioned) and:

  1. there's such a big discrepancy in value from the lease company;
  2. you are in good stands with the company, i.e. there are no conflicts you believe that might have lead to this administrative lapse and your co-workers are not out-performing you;
  3. if you are given an alternative compensation, then you don't mind driving the basic car you have been driving for the past couple of years...

Since it was your company's fault for messing things up, I don't see why not proposing an alternative solution:

Dear [HR manager/boss name],

I appreciate your gesture in attempting to fix the administrative lapse [i.e. this is their problem, not yours] that is leading to a different lease contract to be soon written for the company's car assigned to me.

However, since the car I have driven so far is still adequate for my needs, I suggest to lessen the administrative burden by providing instead a monetary compensation equivalent to the bonus given to my classmates after the 2 years probation period.

This way it looks like you are trying to help them (not demanding anything) and it may actually open the door for future working conditions negotiations within your company (not only for yourself but to other workers as well, i.e. you're turning a mistake into an improvement).

Please, don't copy and paste the text above. If you plan to use this kind of approach, smooth its edges and adjust it better (according to the way you normally address your company).

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    Unfortunately, it does not work like that. Giving a car is less onerous to the company, as they can offset the cost in tax cuts declaring the car leases, depreciation and often fuel costs as part of operational costs - and also because if they pay money, they also have to pay more IRS and social security. Which kind of leds me to suspect the difference of monthly costs between the two car models is a lie, the net difference should be minimal for the company budget at the end of the day. – Rui F Ribeiro Apr 28 '18 at 13:16
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    @RuiFRibeiro not sure if the Netherlands has the same situation (but would not be surprising since they're a neighbour), but in Belgium there's a law you can in fact demand monetary compensation in lieu of a company car. However, this might only apply to getting one at all, not an upgrade. – htmlcoderexe Apr 28 '18 at 15:09
  • @htmlcoderexe I did not meant it is not possible, it just translates to a considerable less amount of money – Rui F Ribeiro Apr 28 '18 at 15:13
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    @RuiFRibeiro: Dutch tax law treats almost all expenses equally for tax purposes, the chief exemption being food&drinks. But wages and employee cars? All costs of employment. The chief thing however with wages is that wage increases would be treated as permanent; i.e. if next year he'd get a 5% pay raise it would be over the whole package. And in 40 years time, his pension will be based on the increased pension premium over 40 years cumulative. – MSalters Apr 28 '18 at 20:58
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    @htmlcoderexe: No such law in the Netherlands. However, the industry sector is competitive enough that can usually negotiate an 18 cents/kilometer tax-free rebate for using your own car, or tax-free public transport. – MSalters Apr 28 '18 at 21:00
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If you've missed out on something that you would have been entitled to because of a mistake by HR, then it's entirely reasonable for you to complain. If they had not made the mistake, you would have been entitled to get a car under the previous rules, so you are suffering a measurable, material loss as a result of their mistake. Speak to your union rep if you have one, otherwise go to HR.

I wouldn't expect any financial compensation, and there may be tax implications if the actual value of what you receive ends up being higher than it would have been, but an upgrade would definitely be reasonable.

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    Union rep? In a Dutch software company? HR wouldn't know what happened to them, if they ever met one. A better recommendation in Dutch circumstances would be to check your insurance, to see if it covers legal advice. – MSalters Apr 28 '18 at 20:54
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But the real problem for me is that I'm not getting the same treatment as my colleagues on this matter.

I believe that's the core of the problem. Personally, I would be less bothered by lower salary than by worse car (disclaimer: I'm not a car person, I don't even have have a license). The issue here is perception: your car is very visible. It's a representation of how the company values you. It creates your image. If 3 persons are at similar positions, and one of them got a smaller salary - nobody would know until they start boasting about it. But if one of them got a worse car - it's a clear sign to everyone around that this person is of lower importance, even if he/she is not. Everyone who can see the cars will think of you less. We are still driven by simple animal instincts deep inside, bigger horns make a pack leader.

I don't think there is a compensation possible. The loss is on your image and it can't (or rather I believe it: shouldn't) be compensated financially. I would explain this concern to your management and insist on getting the exactly same car. The fact that they forgot about you is already a slap to your face bad enough. It's not you who made the mistake of forgetting to order a car, you cannot be punished for anther person's mistake. Any "price changes" are simply out of the question here, it's an inadmissible argument in this discussion because it was not your fault. I can't think of anything that could counterbalance the loss of authority other than an actual promotion (eg. not an empty title), complete with appropriate salary bump (otherwise there is a risk of yours getting frozen and when other people get promoted, they'll get more with less experience).

The price change is meaningless even if you want to take the blame for not pushing for new car right away. Because it's irrelevant how much someone up the chain paid for the perk. The value of the perk is the value of the car, period. If the company would struck a particularly good deal and lease a Ferrari for $1/month - would they give it to the CEO or to the doorman? By their logic, a doorman would get it, and CEO would get a $100/month Nissan Micra "because it's 100 times more expensive therefore it's a bigger perk". If they want to shift the responsibility for managing the lease to you, then let them give you a car lease budget, and you'll decide how much of you'll put to the lease, maybe pocket the rest, maybe add something from your salary and you pick the car and the leaser (such arrangements are not unheard of).

Another angle is to interpret the "mistake" as deliberate, because you're not perceived as as valuable as your colleagues. It's perfectly possible: they can't easily lower your salary, so they make the cut somewhere it's convenient. You can use it as an argument: What message are they trying to send? Because it is a message (whenever they intended it or not). Just be prepared for the truth to be harsh. It could ultimately work out to the better: you can force the management to say what aspects of your performance are lacking so you can improve them (usually in cases like this, it's self-promotion skill).

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Unless the specifics of the company car were mentioned in the work contract there is nothing you can do, there also is nothing you can ask for. You weren't promised a specific car.
One question I would ask myself would be "would I be unhappy about the car I was given if my coworkers had received the same car ?". (Slight aside... one of the lead developers in a company I worked for asked for a company car, then got a 10+ year old VW Golf).
What I would do in your situation is accept the car gracefully, don't say anything more about it, but do bring it up in your next evaluation meeting or whenever you would ask for a promotion/raise anyway. But in a more "I've saved you money on my company car" kinda way rather than "I deserve a raise because you screwed me on the car" way.

  • "I've saved you money on my company car"... this would backfire when they can just claim that they spent the same on everyone. – Mehrdad Apr 28 '18 at 11:17
  • In that case I might just tell them flat out that I question their judgement or negotiating if they paid the same for a car that costs $7k less. (I'm assuming that we're talking around 20%) – xyious May 4 '18 at 21:58
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There's no compensation due because your company is spending the same amount on you as your colleagues, due to "price changes". Unfortunately, someone made a mistake that delayed your car and by the time you and they got to it, you suffered from a market flux. Life's not fair, but it's not your companies fault. Asking them for compensation would be like "looking a gift horse in the mouth"; almost literally, and even worse: not just looking but complaining. Don't take it personal, stuff happens and you still get a car.

But the real problem for me is that I'm not getting the same treatment as my colleagues on this matter.

That's not actually true; your company is spending the same on you as your colleagues, just your company (and you by proxy) are being screwed by the car people. Hate the car people, but don't feel insecure about your value in the workplace.

When I was 9 my dad bought my brother and me the last two scoops of orange ice cream, both of our favorites. As he was handing me my cone, it fell on the ground. When he went to get me another, they were sold out of orange, and I had to get lemon. It wasn't my dad's fault they ran out, and somehow I picked up the pieces of my shattered life to live a somewhat fulfilling and interesting life. Don't let the thing get you down, just crash the car next year and make them get you a newer car than your colleagues...

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    -1 "Unfortunately, someone made a mistake that delayed your car and by the time you and they got to it, you suffered from a market flux." Erm, what? If "someone" made a mistake then shouldn't that "someone" be the one that suffers from a market flux? Why do I have to accept that if you make a mistake then I have to accept that I'm the one who pays for it rather than you? – Mehrdad Apr 28 '18 at 11:14
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    In what sense is it a "gift"? Is your salary a "gift" too? I know in the US at least the IRS won't consider something a "gift" just because you called it that... if it was in return for work you did, it's income. – Mehrdad Apr 28 '18 at 11:38
  • There's a very, very thick line between "there's no compensation due because your company is spending the same amount of money on you" and "yeah, you're right, but I don't recommend you point that out because you'll look like a jerk regardless". If you mean the latter, I would edit the answer. – Mehrdad Apr 28 '18 at 11:45
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    It seems you're still completely missing my point? You say "we tend to worry too much about what others get" but I literally just said that this wouldn't be such a big deal if the dealer was the cause of the problem. The problem is the company screwed up, so it's not just a matter of what others get; it's a matter of being treated fairly, and it's not fair to screw up and expect someone else to bear all the consequences. – Mehrdad Apr 28 '18 at 12:05
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    If it helps, maybe ask yourself if you think this guy would have had the same problem seeing his coworker win that car in a lottery, rather than from his employer. I don't think that would've been the case. Unless you have evidence to believe otherwise, that should make it pretty clear that the problem isn't what the other guy is getting, but that he's simply not being treated fairly. – Mehrdad Apr 28 '18 at 12:13
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I agree with you, that this is unfair, but life will always be unfair. As mentioned by others, your management will likely see you as ungrateful, because they give you a nice car and all you do is complain (from their view). I understand that this is especially unfair, because someone might view you as less important. However, by being graceful, you indicate maturity and that might help you in the long run. If your management does not make such mistakes all the time, I would not recommend looking for another job, just because of this incident.

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    They're not "giving" a car. It's part of the salary. – James Moore Apr 28 '18 at 3:54

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