{"id":551,"date":"2026-02-20T17:47:43","date_gmt":"2026-02-20T16:47:43","guid":{"rendered":"https:\/\/www.kanzlei-wuebbeke.de\/nicht-kategorisiert\/the-company-car-rights-obligations-and-typical-disputes\/"},"modified":"2026-02-27T15:49:16","modified_gmt":"2026-02-27T14:49:16","slug":"the-company-car-rights-obligations-and-typical-disputes","status":"publish","type":"post","link":"https:\/\/www.kanzlei-wuebbeke.de\/en\/labor-law\/the-company-car-rights-obligations-and-typical-disputes\/","title":{"rendered":"The Company Car \u2013 Rights, Obligations and Typical Disputes"},"content":{"rendered":"<p>In many employment relationships, a company car is an attractive component of remuneration. It not only serves professional mobility, but is often also provided for private use. It is precisely this dual function that makes the company car complex under employment law. Time and again, disputes arise over the scope of use, costs, revocation options, or return upon termination of the employment relationship. A clear classification under employment law is therefore essential.    <\/p>\n<h2><strong>Company car as a work tool or a component of remuneration<\/strong><\/h2>\n<p>From an employment-law perspective, the first step is to distinguish whether the company car is provided exclusively for business use or whether private use is also permitted. If the car is made available only for operational purposes, it is purely a work tool. In this case, the employer can generally determine when and how the company car is used.  <\/p>\n<p>The situation is different if the employee is permitted to use the car privately. In that case, the company car regularly constitutes a <strong>taxable benefit in kind<\/strong> and thus part of the remuneration. This has significant employment-law consequences. The employer cannot simply withdraw the company car or restrict private use, as this would constitute a unilateral reduction in remuneration. Corresponding provisions should therefore be clearly set out in the employment contract or in a separate company car agreement.    <\/p>\n<h3><strong>Rules on use and allocation of costs<\/strong><\/h3>\n<p>In practice, disputes often arise over the scope of use. Typical questions concern <strong>private use<\/strong> by family members, trips abroad, or use during vacation. In the absence of a contractual provision, comprehensive private use is generally to be assumed in case of doubt.  <\/p>\n<p>The allocation of costs should also be clearly regulated. While the employer typically bears ongoing costs such as insurance, tax, maintenance and repairs, employee contributions can be agreed. Liability for damage is also relevant: if the employee causes damage to the company car, the <strong>limitation of liability under employment law<\/strong> generally applies. In cases of slight negligence, the employee is not liable; in cases of moderate negligence, liability is apportioned; and in cases of gross negligence or intent, the employee is liable in full.   <\/p>\n<h3><strong>Revocation and withdrawal of the company car<\/strong><\/h3>\n<p>Revoking the right to use a company car is particularly prone to conflict. Such a revocation is permissible only under strict conditions. If the company car is part of the remuneration, the employer can generally withdraw it only if a <strong>valid revocation clause<\/strong> has been agreed. This must be transparent and must not unreasonably disadvantage the employee.   <\/p>\n<p>If such a provision is missing, withdrawing the company car is generally impermissible. The same applies to a unilateral restriction of private use. Even in the event of prolonged incapacity for work, the company car cannot simply be demanded back unless there is a clear contractual basis. This highlights the considerable importance of careful contract drafting.   <\/p>\n<h3><strong>Company car upon termination of the employment relationship<\/strong><\/h3>\n<p>Upon termination of the employment relationship, the question arises as to the return of the company car. In principle, the employee is obliged to return the car as soon as the employment relationship ends. However, situations during the notice period, in the event of garden leave, or even summary dismissal can be problematic.  <\/p>\n<p>If the employee is placed on garden leave while continuing to receive remuneration, the company car may in many cases continue to be used, provided it is part of the remuneration. Otherwise, early withdrawal may give rise to a claim for financial compensation. Here, too, the contractual provisions and the specific circumstances of the individual case are decisive. In the event of incapacity for work during the return obligation, the highest-court case law has held that the employee does not have to return the company car at the employer\u2019s place of business; rather, the employer must collect it itself from the car\u2019s current location, usually the employee\u2019s place of residence.   <\/p>\n<h3><strong>Conclusion<\/strong><\/h3>\n<p>From an employment-law perspective, a company car is far more than just a vehicle. Depending on how it is structured, it is either a work tool or a component of remuneration\u2014with significant implications for revocation, liability and return. Both employers and employees should ensure clear, legally secure agreements in order to avoid later conflicts. Early legal advice creates transparency and prevents costly disputes.    Please feel free to contact me about this.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>In many employment relationships, a company car is an attractive component of remuneration. It not only serves professional mobility, but is often also provided for private use. It is precisely this dual function that makes the company car complex under employment law. Time and again, disputes arise over the scope of use, costs, revocation options, [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":552,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[24],"tags":[32,34,35,41,37,39],"class_list":["post-551","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-labor-law","tag-company-car","tag-dispute","tag-employee","tag-employer","tag-motor-vehicle","tag-termination"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>The Company Car \u2013 Rights, Obligations and Typical Disputes - Kanzlei W\u00fcbbeke<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.kanzlei-wuebbeke.de\/en\/labor-law\/the-company-car-rights-obligations-and-typical-disputes\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The Company Car \u2013 Rights, Obligations and Typical Disputes - Kanzlei W\u00fcbbeke\" \/>\n<meta property=\"og:description\" content=\"In many employment relationships, a company car is an attractive component of remuneration. 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