Documents for Business
In excess of 1,000 customisable documents covering every conceivable business issue.Introduction to this document
Credit and charge card clause
Use our credit and charge card clause where you issue an employee with a company credit or charge card. It sets out what the card can be used for, what must be done if it’s lost, damaged or stolen and what happens if it’s misused.
Business-related expenses
The first point is that any credit or charge card issued to an employee is to be used only to pay properly incurred business travel expenses or other legitimate business-related expenses. It’s not for personal use. Our clause makes this clear. You could go further than this if you like and specify what exactly it can be used for. Conversely, you could also specify what it can’t be used for. You might also want to tie it in to your expenses policy if you have one. Secondly, we’ve provided that it must be used within the credit limit you set. Be careful not to have too high a credit limit, taking into account that your aim will be to pay the debt off every month so as not to incur interest or penalties, so it should only really be needed to cover one month’s worth of expenses at a time. Finally, we’ve made it a disciplinary offence for the employee to misuse the card to incur non-legitimate business expenses, such as for buying personal items. Depending on the seriousness of the offence, we’ve provided that it may amount to gross misconduct and could result in the employee’s summary dismissal.
Loss, damage and theft
One big concern will be if the credit or charge card is lost, stolen or damaged. Damage is less of a problem as you can simply order a replacement card. However, where it’s lost or stolen, it’s imperative that the card issuer is notified urgently, so that the card can be cancelled before it’s used for fraudulent transactions. We’ve therefore provided that the employee has to notify you immediately and must also report the loss or theft to the card issuer as a matter of urgency as soon as they notice the card is missing. With credit, debit and bank issued charge cards, where it’s used by an unknown third party on fraudulent transactions, you can be liable for the first £50 incurred before it has been reported as lost or stolen to the card issuer (although many issuers will waive this liability). Liability could, however, be greater where the bank can prove the card owner acted fraudulently, negligently or without reasonable care. So, to cover this, we’ve provided that the employee is personally liable for any sum that has to be paid out as a result of the loss or theft and you have the right to deduct this from their salary.
