Conference 7.286::digital

    Company Car (Plan A)	Digital leases a vehicle thru GELCO
    				leasing. They pay for everything
    				(insurance, gas, oil, car wash, parking,
    				repairs). The employee must pay Digital
    				$30 every week for private use of the
    				car (regardless of how little/much the
    				vehicle is used for personal travel).
    
    				Generally, employee pays for the gas and
    				miscellaneous expenses during the week and
    				deducts that from the $30 they owe DEC. 
    				Sometimes you owe the company, and
    				sometimes they owe you.
    
    				When ordering a new car, employee gets to 
    				pick from 2-3 different models. Some
    				options are provided (like A/C, Radio,
    				Tape Deck). Employee can order additional
    				options at his/her own expense. These
    				costs can NOT be recovered by the employee
    				for any reason. If you order $1,500 worth
    				of options and change jobs 4 months later,
    				you lose your $1,500. (Unless the job you
    				switch to entitles you to a car ... then 
    				you can move the car to your new cost ctr.)
    
    Use Your Car (Plan B)	Available only to "field people" (like
    				sales and EIS). Digital writes you a check
    				for $250/month LESS a deduction for income
    				tax. In addition the employee gets 8� per
    				mile driven on company business. Employee
    				pays their own insurance, gas, oil, etc.
    
    				To do this, the car must be 4 years old or
    				less. If in sales, the car must be a 4-door
    				car capable of carrying 5 passengers.
    
    Use Your Car (Plan C)	For all other employees who don't qualify 
    				for Plan A or B (i.e., they are not in the
    				field), Digital pays 22.5� per mile
    				traveled on company business.
    
    
    /se

	... by requiring DEC to figure a "fair market value"(?) of the benefit 
of a Plan A car, subtract the $30 per week you already pay, and add the 
difference to your W-2 wages each year.

    re: .1
    
    Since when was plan B $250/mo - taxes. It's $200/mo - taxes. I've been
    on plan B for 13 years. My monthly check went from $200/mo to
    $172.76/mo when they started taking out taxes. This was just verified
    both by personnel and fleet as I write this reply.
    
    Regards
    AL ROOT
    

    Given that the writer is not from the US, perhaps a more "overview"
    answer is being asked for.
    
    While in England (and possibly other countries) a large number of
    people have cars provided by their employer, in the US it's not as
    common.  Company cars are normally used only by sales, service and
    delivery people who must travel a lot as part of their jobs.  Most
    Americans own a car privately, having used a loan to buy it.
    
    			-John Bishop

    Given that we are discussing this type of thing, maybe someone can
    clear something up for me.  I have heard that in certain big cities
    (e.g., New York), people get a 'walking allowance' instead of a car
    plan.
    
    Is this true?
    
    If so, how does it work?  do you still get reimbursed for cab or bus 
    fare, etc?
    
    Thanks 

    re .4:
    
    I don't have any statistics (and I wouldn't believe in them anyway :-)
    but it's not all *that* common in Europe either.
    
    It is fairly common in certain types of jobs - the main reason being
    that the 'fair market value' set by the respective tax people tends to
    be less than the REAL value, so the car is considered a nice fringe
    benefit especially for those people who are in the upper brackets of
    progressive income tax (and everyone has a car anyway, even in Europe).
    
    I've been away for this week (and there has been some talk about a new
    car policy for DEC Germany in the meantime, explaining the sudden
    interest of German participants in these questions). I don't know what
    the new announcements were, though..
    
    Re walking allowance - I think this applies (applied?) to people
    walking in our Central London office too - justification being, a car
    in Central London is useless anyway..
    
    I think there's a basic difference in philosophy: in some
    countries/companies a car is considered a fringe benefit, is some
    others a tool you need to do your job. That's fine as long as both
    sides agree on this... over here, in Germany, the problem is very much
    more complicated (legally) but that's another story.
    

    Re .3 (re .1)
    
    Not only is U.S. Plan B $200 (instead of the posted $250), but as of a
    couple of years ago the car can be 5 model years old instead of the
    posted 4. (I know, I still have an '86 on Plan B, and my last check was
    still $200 less taxes.)
    
    	BD�

    re .5:
    
    In NY, we recieve an extra check along with your first pay check of the
    month.
     
    The Manhattan Allowance is $110/week gross with is taxed. It nets out to
    approx. $330/month.
    
    It is generally viewed as "battle" pay, having to tolerate commuting
    to the city everyday, which costs approx. $150/month train fare, plus
    1 1/2 hour door to door commute.
    
    

    
    
      Gee - I wonder if us N.H. people who have to work in Mass
    could get the same thing?  :^)
    
    
                                            -al
    

    
    RE:9
    
    Yeah!  120 miles round trip per day,I would appreciate an allowance
    as well. 
    
    The things we do today for a job. Oh-well!
    
    Rick  (A Jerry Williams fan)
    
    
    
    

    
    Does DEC sell these cars and trucks to the employee?
    
    Is there a listing in the U.S. Area?
    
    Rick
    

    Re .11 (Rick)
    
    I bought each of my Plan A cars when they hit end of life. I imagine
    the policy is still the same, but I don't know for sure. I suggest you
    call Fleet and ask. I don't know if there's a listing of Plan A cars
    available for purchase.
    
    	BD�

    re: .8
    
    Not everyone in Manhattan gets the "Manhattan Allowance." I transferred
    to NYO from California. My boss tried to get me a salary bump, but
    Personnel (oops, Human Resources) said no way -- they consider the cost
    of living the same here as there. I've got an issue with that, but
    that's life.
    
    I think the "Manhattan Allowance" may be something to do with Sales
    only. Does anybody know for sure?

    re: buying cars
    
    Keep in mind that the new Plan A rules "apparently" state (that is,
    I've been told this, but have seen no official policy verbage) that
    Plan A cars will now be run into the ground.  If the car continues to
    function flawlessly, it apparently can be kept around until the 80-85K
    mile mark (or longer -- this is not clear).  Otherwise, once a car
    passes about 50K miles, it will be retired when it begins to cost money
    (i.e., it breaks down).
    
    Hence, you can expect to purchase either a VERY high-mileage vehicle or
    a broken one (which may have high mileage as well).
    
    -- Russ

    Check out the various sections in the VTX US_FLEET policies.
    
    Note that several sections were updated last april. Among other things
    the end-of-life for a plan A car was reduced to 30 Mo. or 50K miles.
    Note also that the policy permits you to purchase the car earlier, if
    you obtain the appropriate signature (District Mgr.).
    
    I can personally attest that these policies are valid; My plan A car
    recently turned 30 mo., and I just completed the entire purchase cycle,
    including transfer of the vehicle to Plan B.
    
    From careful reading of the original memo and some inquiries, the only
    thing that is being restricted is the acquisition of *new* plan A cars.
    
    If you have a Plan A car that you want to
    
    a) purchase and move to plan B, go for it, no problems.
    b) purchase and get a new plan A car, you will probably be permitted to 
    	purchase it, but you will probably get a used/unassigned plan A car.
    c) replace with a new plan A car, unless the car is on it's last legs,
    	this won't happen. If it is on it's last legs, odds are you will 
    	not get a new car, but a used/unassigned plan A car. Only when the
    	car has reached it's *real* end-of-life, and there are *no* used/
    	unassigned cars available will a new car order be placed.
    
    Regards,
    	Dave

    re: .15
    
>    Note that several sections were updated last april. Among other things
>    the end-of-life for a plan A car was reduced to 30 Mo. or 50K miles.
    
    Please note the following excerpt of a memo which came from our DM's
    office:
    
>    Last Tuesday, January 15th, I spoke with Ken Monier, Regional 
>Business Partner reporting to Don Zereski.  Ken is responsible 
>for the US fleet and is located @ALF (DTN 385-2320).

...

>    .	 Plan A vehicles will now be kept for 48 months and/or 
>         80,000 miles, unless deemed unfit by GELCO;
>
>    .	 Once a Plan A vehicles has been deemed unfit, an 
>         unassigned vehicle (of which there are 300 in the 
>         Washington metropolitan area) will be assigned as a 
>         replacement.
>
>    .	 The time limit for Plan B vehicles is five years.
>
>    This policy will be in effect until further notice.  NOTE:  
>Once all of the unassigned vehicles have been assigned, your Plan 
>A car reaches 48 months and/or 80,000 miles, THEN a new car may 
>be ordered.  There will be no exceptions!
>
>    Should you have any questions or require additional 
>information, please contact Ken as mentioned above.
    
    -- Russ

     RE: a few back
    
    The folks in Manhattan (I used to be one) that get a walk in allowance
    are those who are in a position (ie sales/support/pss) that would allow 
    them to participate in plan A or B if they were not in Manhattan.  
    I think there are a couple of other US cities that have walk in 
    allowances as well.
    
    
    Serv

    I just learned today that the GELCO folks are planning to charge DEC
    $500 per month / per car for each car on the road! In light of the fact
    that we now have to keep the cars until they "fall apart", it is
    AMAZING what is paid for these cars - $6K per year. If they are kept
    for 4 years - not inconceivable on the current plan - DEC will layout
    $24K per car! It is inconceivable that even adding insurance and
    repairs / tires, it is anything but a ripoff to DEC! I think that a
    DECENT large increase in plan B allowance would easily gain back
    several million in costs!

    
    RE: -.1
    
    The few people I've talked to in other computer companies only have
    a plan B-type option.  The common figure is a $450/month allowance,
    which is subject to witholding.  No extra per-mile rate is given.
    The employee pays insurance, maintenance, fuel, etc.
    
    	

    Given this confirmation of other computer companies car plans & our own
    costs for cars per month; it seems clear that there is NO justification
    to not increase plan B compensation. Even at $400 per mo. compensation 
    for a B plan, the company could save $600 per year for each employee
    who converted plans. With an ATTRACTIVE option, a few hundred thousand
    could easily be saved per year.

    One of the things which frosts me is getting my Fleet Cost Center
    report every month.  I lay out $450/month for each Plan A car and $200
    for the single (mine!) Plan B.  I'd guess that at $350/month for
    Plan B, you would probably not have too many complaints if you did away
    with Plan A, and that would save the company a few million dollars.  A
    real win-win.
    
    Al
    

    Having just recently come onto Plan B, does anyone know the date of the
    last increase in the Plan B allowance?
    
    Just curious
    Jon

    re: -1
    
    It was at the same time the demise of Plan A was announced (then
    rescinded), about 2-3 years ago.  Previous to that it was $180 ever
    since (and presumably before) I joined the company in '83.
    
    Just using a crude sort of rate of change analysis, intuition tells you
    it was either way too high a decade ago or way too low now.
    
    Al
    

    Re: .20
    
    >to not increase plan B compensation. Even at $400 per mo. compensation 
    >for a B plan, the company could save $600 per year for each employee
    >who converted plans. With an ATTRACTIVE option, a few hundred thousand
    >could easily be saved per year.
    
    Don't forget that it will cost the company $1200/yr for every employee
    already on Plan B.  To break even, you will need two employees to
    switch for every one already on Plan B.

    Let me be the first one to correct my own math.  If plan B goes to $400
    per mo. then it will cost the company $2400/yr for each employee
    currently on plan B.  That means you will need four employees to switch
    from A to B for every one already on B just to break even.

    re -.1;
    
    If you drop plan A, that's not a problem since it would appear that
    less than 10% of the field is currently on plan B.  Besides, this move
    would also significanly reduce the administrative overhead cost of plan
    A (Fleet Admin., some processing of weekly expense forms, accident
    report processing, claims handling).
    
    Of course, since I'm currently on plan A, I think this is a terible
    idea ;^)
    
    -dave

	In Sept 1988 the rate for Plan B increased from $180 to $200

	In 1990 Plan B compensation became eligble for FICA inclusion
	dropping Plan B from $200 per month to $184.70


	Of course Plan B compensation has alway been taxable income.


	Issues to get people from Plan A to Plan B


	1)  Have Digital provide a vehicle finance/lease program 
	     to assist the employee in Digital's name.
	     - Car Payments adversely effect
	     credit ratings especially in areas of the country with
	     very high housing costs.

	2)  Have Digital provide a special auto insurance program.

	3)  Have Digital assume or assist with some of the maintenance 
		risks

	4)  Make the compenstation commensurate with the above costs.


	Of course today, how many district managers will approve new
	Plan A cars?