K&S vehicle policy shot down by Fair Work Australia

K&S Freighters’ policy of charging drivers for damaging trucks is “unfair and unreasonable”; driver awarded $21,000 compensation

K&S vehicle policy shot down by Fair Work Australia
K&S vehicle policy shot down by Fair Work
By Brad Gardner | September 2, 2010

K&S Freighters’ ability to sack drivers for damaging trucks has been dealt a heavy blow, with the industrial relations umpire labelling the policy "unfair and unreasonable".

Fair Work Australia Deputy President Deidre Swan has criticised K&S’ stance of holding drivers financially liable if they are deemed by the company to have negligently damaged a truck. Those who refuse to pay are sacked.

Known as the Vehicle Policy, it states: "An employee may be required to meet part or all of the cost of repaying any damage caused to a Company vehicle, where the employee or a driver authorised by the employee was negligent."

"Notwithstanding the use of the word ‘may’ in the Policy, there is no question that the Policy with the above inclusion, without any further explanation or qualification as to how it could or would be implemented, has all the hallmarks of unfairness," Swan says.

She made the comments during the case of driver Chris Birt, who was fired under the policy after refusing to pay $3100 to repair a truck bumper he damaged. Swan ordered K&S to compensate him $21,000 for unfair dismissal.

She found Birt was denied "procedural fairness" because K&S did not investigate the incident or take into account mitigating circumstances, instead apportioning complete blame to the driver and denying him the chance to state his case.

Birt damaged the bumper while reversing into a loading dock. It was dark at the time, there were no people around to assist him and reflection from the yard lights hampered his vision.

"There were significant mitigating circumstances concerning the applicant’s involvement in the accident which should have been considered and there was a clear lack of process and thereby fairness afforded to the applicant," Swan says.

"The Policy in question, as it has been implemented in this case, appears to be a non-negotiable Policy with the question of ‘negligence’ being unilaterally determined by the respondent without any consideration of the employee’s views."

Swan ruled that K&S provided no training to staff on what constituted ‘negligence’ by a driver and says Birt had no idea of the existence of the policy or agreed to it.

Furthermore, Swan says Birt was dealt with harshly because he had "an impeccable driving record" which was not taken into account by K&S.

Under the enterprise agreement governing K&S truck drivers, the company can sack employees for fighting, stealing, unsafe practices, drug use, bullying and serious or potentially serious vehicle accidents.

But when cross-examined about the damaged bumper, K&S human resources manager Kay Evans agreed it did not fit into the category of a serious accident.

"The accident which had occurred was not of a serious nature. The nature of the damage to the vehicle was not serious and from the evidence before me, there was no risk of injury to anyone," Swan says.

Court documents also point to unrest within the senior management ranks of K&S over the policy

During proceedings Birt recollected a conversation he had with K&S Queensland State Manager Don Gailer

Birt says Gailer told him: "Off the record, you should pursue this as far as you can because what is being done here in unfair. If you repeat this I will deny saying it."

The K&S union delegate and truck driver Harvey Taylor corroborated Birt’s claims. Swan upheld Birt’s recollection of the conversation as "truthful…to the effect that the Policy was unfair and it should be challenged".

The Transport Workers Union has called the ruling a landmark decision that restores the rights of truck drivers.

"The policy by K & S Freighters of using their drivers as de-facto insurers for their vehicles has now been shown, without a shred of doubt, to be not just unfair but unlawful," TWU National Secretary Tony Sheldon says.

He wants K&S to compensate all drivers dealt with under the policy and has issued a stern warning to other companies.

"There were a number of other transport operators and employers around the country who were looking at this case with interest – but the precedent has been set. It is against the law," Sheldon says.

The ruling comes as the Federal Court prepares to hand down its decision on the vehicle policy. The court reserved judgement in June after the TWU questioned the legality of K&S’ decision to sack truck driver James Lee under the policy.

TWU barrister Adam Hatcher raised similar concerns to Birt’s, namely Lee was unaware of the policy and the accident was not investigated before a decision to sack him was made.

The vehicle policy exists singularly and as part of the driver handbook. The wording of both documents is different, with the former saying a driver "may" be financially liable. The latter says "negligent damage will be costed to the employee".

According to Hatcher, the policy of deduction or dismissal "strikes at the heart and foundation" of employment awards because minimum rates of pay may not be guaranteed if a company can deduct money by threatening the sack.

K&S' barrister Chris O'Grady has cautioned against striking down the operator's ability to take action against drivers deemed to have negligently damaged vehicles.

If Hatcher's submission is upheld, O'Grady claims K&S may be powerless even in a blatant case of negligence that had been thoroughly investigated where the driver may admit fault.

"This is the scenario that might well occur," O'Grady argued.

"My client would not have the right to terminate the employment of the employee."

Hatcher, however, says it is OK to deduct money if an employee consents to it without being threatened with the sack. K&S Managing Director Legh Winser says the policy has reduced the incident and accident rate of vehicles by 60 percent.

Related stories:
K&S falls foul of union
Get your facts straight, K&S tells TWU
Driver didn’t know of K&S policy, court hears
K&S was right to sack driver, court told
K&S accused of being ‘untrue’ on vehicle policy
Federal Court reserves judgement on K&S policy

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