Contract for Use of Company Vehicle

A contract for the use of a company vehicle is a legally binding document that outlines the terms and conditions of using a company-owned vehicle. It’s an essential document for any business that provides vehicles to employees for business purposes. The contract helps ensure that the vehicle is used for its intended purpose and that the employee understands and agrees to the conditions of its use.

The contract should contain the following sections:

1. Definition of Terms

This section provides definitions for key terms used in the contract, such as “employee,” “company vehicle,” “authorized use,” “prohibited use,” and “wear and tear.”

2. Authorized Use of Vehicle

This section outlines the primary purpose of the vehicle, which is typically for business purposes only. It also lists any authorized exceptions to this rule, such as commuting to and from work or using the vehicle for personal errands during work hours.

3. Prohibited Use of Vehicle

This section lists all prohibited uses of the vehicle, such as using it for personal purposes outside of work hours, using it for racing or other illegal activities, or allowing others to use the vehicle without authorization.

4. Maintenance and Repairs

This section outlines the responsibilities of both the employee and the company when it comes to maintaining and repairing the vehicle. It should include guidelines for regular maintenance, such as oil changes and tire rotations, as well as instructions for reporting any accidents or damage to the vehicle.

5. Insurance and Liability

This section outlines the insurance coverage for the vehicle, including liability coverage and comprehensive coverage. It should also clarify the employee’s responsibilities in the event of an accident or damage to the vehicle.

6. Consequences of Misuse

This section outlines the consequences for violating the terms of the contract, such as suspension or termination of employment, loss of driving privileges, and financial penalties for damages to the vehicle.

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