Australian Trucking Association Chair, David Smith introduces the ATA plan for fair trucking contracts in the industry.
The ATA has released a detailed plan for trucking industry contract standards, after extensive discussions with our members.
According to the ATA the plan would deliver fair contracts for the trucking industry. The plan would still give businesses an incentive to innovate and share the results with our customers.
Under our plan, the Fair Work Commission would not have the ability to set freight rates. Its role would not overlap with the state safety regulators, including the NHVR, or the driver licensing rules. Honestly, the last thing we need is more organisations trying to set work and rest hours.
The commission would be able to make orders setting road transport contract standards, including orders about payment terms and the formulas used to calculate fuel levies. The commission’s orders would apply to all trucking businesses and their customers.
As a result, there would not be a two-tiered system of rates or standards, which is what occurred under the Road Safety Remuneration Tribunal.
We all remember what happened. Instead of helping owner drivers, the RSRT’s orders priced them out of work. That wouldn’t happen under our plan. The commission’s orders would apply to everyone.
The commission or a court would be able to determine that a road transport contract term was unfair if the parties were unable to demonstrate that the term had regard to the costs faced by the business.
In making the determination, however, the commission or court would consider the ability of businesses to purchase goods, services and finance at different rates, if the costs faced by the business were reasonable and if the business had chosen to spread its costs over multiple customers or more than one leg of a multi-leg journey.
Trucking businesses with a turnover of less than $2 million per year would be able to go to the commission to resolve disputes about unfair contract terms. That’s nine out of ten businesses in our industry.
The 3,900 larger businesses in our industry would continue to resolve unfair contract disputes through the courts. The commission is not the right place to resolve complex contract issues involving large companies.
The filing fee to go to the commission to deal with an unfair contract would be higher than the unfair dismissal fee, but it would still be very low compared to going to court. Our thinking is that $1,500 would be about right.
The commission would be able to publish indicative cost schedules to help businesses comply with the unfair contract requirements. These cost schedules would be advisory, not mandatory.
Every trucking business is different, and we know more about our costs than consultants, public servants, unions or industry associations, no matter how well meaning. Because the cost schedules would just be a guide, businesses would still have an incentive to look for productivity gains and efficiencies and share them with their customers.
This is important.
The ATA and many others have pointed out for years that increasing the productivity of road freight transport is a key to reducing costs across the whole of Australia.
Research we published in 2019 shows that increasing the industry’s productivity would save households about $450 per year on their everyday purchases. There are a lot of people who could do with that money right now.
But no-one would get those economic benefits if businesses can’t share the results of their hard work on productivity with their customers because the commission has set their freight rates.
Our industry needs fairer contracts. What we don’t need is a centralised system where well meaning ‘experts’ tell us what we can charge, even if we can do better.
For more information about the ATA plan. www.truck.net.au.
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