The law allows your employer to require you to use your car for work, whether on a daily or occasional basis. Depending on the job, this could include driving a client from one place to another. However, the law also places additional responsibilities on the employer, including legal liability and reimbursement for expenses.
When an employer requires an employee to use his own car on company business, the employer becomes liable for any tort committed by the employee. For instance, if a member of the direct care staff at a group home for autistic children is required to drive clients to their doctor's appointments in his own vehicle, the group home company can be sued for anything he does in the car while performing that duty. If he gets in an accident and the child is injured, the child's family can sue the company. If anyone else is injured or there is damage to property, the company can be held liable for that, too. The company is within its rights to require the employee to use his personal vehicle, but by exercising that right the company takes responsibility for whatever the employee does.
Coming and Going
Although employers are normally responsible for the acts of their employees whenever the employee is on duty, this usually doesn't apply to the drive back and forth from work. However, if the employer expects the employee to use his personal vehicle for company business, then the employee's possession of a vehicle provides a business benefit for the company and the company can be found liable for the employee's actions while commuting. For example, a salesperson would normally be responsible for his own actions while driving to the office, but if the company expects him to pick up clients in his own car even occasionally then a court may find this to be sufficient reason to hold the company responsible for his actions while commuting to or from work on a daily basis.
If your employer expects you to drive clients around in your own car, it has to reimburse you for your expenses. This includes not only the cost of gas, but your insurance and maintenance expenses, too. These costs can be very difficult to calculate, especially if you only use the car for company business occasionally. The usual method is to pay a flat rate for mileage based on the formula the IRS uses with its own employees, but there is no law requiring companies to use this method rather than another.
Reimbursement for the use of your own car can create a complicated tax situation. The IRS has a set of regulations to determine whether reimbursement should be paid as part of your regular wages or as a separate nontaxable payment. Generally speaking, reimbursement should be paid as part of your wages unless the company asks you to travel away from whatever place you consider your residence for tax purposes. For instance, if your employer wants you to drive to another state to meet with a client and you have to stay overnight in a motel, your vehicle expenses should be deductible.