Toll refuses to support safe rates and claims sub-contractors will be worse off if remuneration methods are reformed
By Brad Gardner | February 18, 2011
The nation’s largest transport and logistics carrier has snubbed a government proposal to reform trucking remuneration and claims owner-drivers will be worse off if a minimum rate is introduced.
Toll has finally adopted a position on safe rates, which the Federal Government wants to introduce to ensure employees and owner-drivers are paid enough to make ends meet.
A 2008 National Transport Commission (NTC) report found a link between low rates of pay and safety. It argued for a minimum rate to be set, but Toll claims government intervention is not the answer.
“We firmly believe the introduction of a new layer of regulation, in addition to the existing regulatory and non-regulatory mechanisms will challenge many smaller transport operators and owner-drivers,” it says.
Instead, Toll wants the voluntary National Logistics Council Safety Code used.
An Allen Consulting Group report – paid for by Toll – says the code is effective because it addresses health and safety, scheduling, time slot management, loading practices and driver fatigue management.
According to Toll, the Government is proposing mechanisms “that will substantially increase costs along the supply chain and endanger the existence and livelihoods of owner-drivers”.
It says increased regulation will only increase compliance costs and render sub-contractors uncompetitive.
The Government has proposed a tribunal to rule on pay matters, and has suggested establishing it within Fair Work Australia. Under one of the three proposals, the tribunal will be able to apply employee-like conditions to owner-drivers.
Toll believes a tribunal that treats owner-drivers similarly to employees will reduce the attractiveness of sub-contractors because there will be no distinction between them and company drivers.
“If the distinction between owner-driver and employee is lost, how attractive will owner-drivers continue to be to the companies who currently utilise them? Is the government prepared to see the jobs and livelihoods of these drivers disappear?” Toll asks.
The company criticises the Government’s Safe Rates, Safe Roads directions paper that argues the case for reform.
Toll claims the paper does not explain how rates will eliminate risky behaviour and that there is no strong argument to justify that remuneration reform will deliver additional safety benefits.
The paper draws on the work of the 2008 NTC report, which points out a wide body of literature supporting a link between rates of pay and safety.
It cites the work of Professor Ann Williamson, whose studies and surveys revealed incentive-based payments cause drivers to work longer hours or take stimulants.
Following extensive work with trucking companies in the US, Professor Michael Belzer found increases in pay reduced the risk of crashes.
The NTC also referenced coronial findings in NSW and South Australia that accepted links between safety and pay.
In its report, Allen Consulting Group says the Government assumes drivers will not speed or work longer to earn more money.
“However, the effectiveness of the regulations would depend on the risk preference of the driver. A risk-loving driver would respond to higher payment rates by driving longer hours, as s/he is willing to undertake more risk for greater economic return,” it says.
The NTC addresses the claim in its report, but says most drivers surveyed said they would not work long hours or use stimulants if they did not need to.
“The NTC does not believe that the potential for a minority to continue to engage in unsafe on-road behaviours, despite having a system of safe payments, is a sufficient reason to not attempt to improve the safety outcomes in the industry through such a framework,” its report says.
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• Safe rate opponents stand firm
• Trucking faces systematic overhaul