Company card with individual liability

fairytwinkles

Hello! Trying to find out if this is legal but not sure where to look for advice (or proof!?)

My company has just advised that all expenses must now be put through on a Green Corporate Amex, and that this card is self settling. (I.e. I'm responsible for it in my name, paid from my current account)

Currently I use my own credit cards for my expenses and the payments will continue to be processed in the same way (I claim and they are paid to my current account).

Can my company force me to take out this card?
I'll be liable, exactly as I am now with my own cards, but I get no choice in the card I use (so no benefits) and have to undergo another credit check.
Surely I should be free to use own card and reclaim the expenses, or the company provide me with a corporate card where it picks up the tab?
But do I have any back up for this? (or where can I go to look up the legalities myself...)

Thanks!

GingerBob_3

It can be worse in some companies. It was the case with a company I know of that YOU were liable for the corporate card; it was provided by AMEX, who reported you to the CRAs as the cardholder. The account was settled by the company and you weren't allowed to use it for personal expenditure. If you didn't get your expense claim in on time then payment was not made and of course you'd then be hit by a late payment marker on the CRA's files.


In this company you could use your own card for expenses, as most sensible employees did.

[Deleted User]

Surely the first step would be to speak with the HR department and ask them to address your concerns?

fairytwinkles

I'm in the process of talking to HR, but attempting to be armed with the facts before I do

The AMEX they're insisting on is definitely a personal liability one, where the employee is responsible and needs to claim the expenses and pay seperately. But they seem to be insisting on us using it, and thus meaning we have to take one out to use instead of the personal credit cards we currently use.

Chino

A question you could ask your HR department is what you're supposed to do if you present your Green Corporate Amex card and find that the merchant doesn't accept American Express.

Whilst lack of acceptance is rarely an issue at hotels and restaurants in the UK, it can be an issue in other countries.

GRM

My employer has the same scheme - corporate card with personal liability - but we're not forced to use it or even take it. I use my own charge card for expenses.

chattychappy

fairytwinkles wrote: »

I'm in the process of talking to HR, but attempting to be armed with the facts before I do

Quite right. Always the best way.

I would look through your contract to see if anything is said on the matter.

Else I would say that they cannot insist you agree to this. Effectively they are saying that you have contracted to make a contract. Ie via your employment terms they are insisting that you enter a further contract with a third party on your own account. This is dubious, legally.

Of course, it is often in the nature of a job that you incur expenses which you reclaim. This could be where you incur costs on behalf of your employer (effectively you are an agent of the company in purchasing something - the company is the party to the contract) or you buy something like a railway ticket. In the latter case, you are indeed contracting on your own account. So it isn't always the case that you can refuse to enter into a contract on your own account when "on business" - that would be unreasonable in the case of something like a railway ticket. But unless it was something that was agreed at the time of your employment (by contract or in the staff handbook), then I don't think you have to accept having to enter into a CC agreement.

Whether you think it is worth making an issue of is another matter.

fairytwinkles

Thanks for your help. My expenses (almost always travel/subsistence) have always been paid by me up front or on my credit card, then claimed back... but having to take a specific credit card to do this seems a little odd. They're currently claiming that it is 'absolutely necessary in order to be SOX compliant', but I think I need their explanation on what this means and why I have to have a new card.

To your last point, I suspect I shouldnt make a big deal out of it, but it just feels a bit funny (and I get heaps of benefits on my personal credit card...)

eddddy

These schemes differ, but here's some general comments...

SOX compliance - they probably mean they will be able to see what's being spent on all cards through the month. So they can predict the size of expense claims, spot 'dodgy' spending etc earlier.

Credit check - are you sure that you will be credit checked? Often there is joint and several liability between employee and employer. If you don't pay, ultimately the CC co will claim the money from your employer. So the CC co rely on the employer's credit worthiness, and not yours.

CC benefits - essentially, your employer gets any CC benefits instead of you.


If it's not stated in your employment contract, you probably don't have to sign up for it (just like you don't have to work through lunch hours). But some people agree to things that aren't in their employment contracts to build up good will etc.

pvt

I have a similar situation where my company issue a Corporate AmEx (which is a charge card, not a credit card). I am supposed to ensure it is paid on time, however reimbursement of money spent on it goes directly to AmEx, not via me.

I would be very surprised if you have any personal liability to AmEx. I don't, and have never signed anything with AmEx to that effect. More fool your employer if they pay you the money and then hope you'll pay AmEx. Sounds like a recipe for someone who's about to leave the company to run up 20k in airfares and hotel bills, claim it back, get it in their personal bank account, and then 'forget' to pay it to AmEx. It is the Company AmEx will go after for the debt.

Zero_Gravitas

fairytwinkles wrote: »

Thanks for your help. My expenses (almost always travel/subsistence) have always been paid by me up front or on my credit card, then claimed back... but having to take a specific credit card to do this seems a little odd. They're currently claiming that it is 'absolutely necessary in order to be SOX compliant', but I think I need their explanation on what this means and why I have to have a new card.

To your last point, I suspect I shouldnt make a big deal out of it, but it just feels a bit funny (and I get heaps of benefits on my personal credit card...)

The SOX excuse is absolute nonsense - SOX is short for "Sarbanes Oxley" and refers to US legislation put in place after the Enron scandal to "improve" financial controls on companies that are either US-based or operate in the US - I'm guessing that your employer falls into one of these categories. As long as your expenses are appropriately receipted and submitted and approved, then there cannot possibly be any SOX issue. I suspect it's much more likely they are using this an excuse to get a bigger kick-back from Amex if everyone uses the card.


My last company tried this as well. The approach I took was simply not to fill in the application and carry on as usual with my personal card. When I left 8 years later no-one had ever questioned any of my expenses being on that card.


If they insist on you having the Amex card on pain of disciplinary action, then get the card - but just don't use it. An awful lot of places don't take Amex, and even if they do then Amex charges the supplier a lot more than other credit card companies.