Exempt existing contracts from 14-day payment terms: Linfox


Linfox believes agreements already in place with contractors should not change, as long as payment terms don't exceed 30 days

Exempt existing contracts from 14-day payment terms: Linfox
Exempt existing contracts from 14-day payment terms: Linfox
By Brad Gardner | August 9, 2013

Trucking giant Linfox wants a proposal for 14-day payment terms to be restricted to new contracts between trucking operators and contractors.

The Road Safety Remuneration Tribunal’s (RSRT) draft remuneration order states contractors are to be paid within 14 days of completing work, but Linfox has suggested the proposal could be an administrative burden if it applies to agreements already in place.

It has written to the tribunal asking for an exemption for existing contracts that have payment terms greater than 14 days but less than 30. It says many companies and contractors currently have contracts specifying payment periods greater than two weeks.

"Linfox submits that such periods…should remain in place to allow such long standing commercial relationships to continue with minimal disruption to the accounting practices of the relevant organisations," the company writes.

While the Transport Workers Union wants the RSRT to mandate a minimum rate for owner-drivers, Linfox says a one-size-fits-all rate "is impractical".

It says the tribunal should instead set criteria to guide trucking companies on the amount of money they should pay to cover the "reasonable costs incurred by a road transport driver".

Linfox also wants a remuneration order to include a clause permitting it to withhold payments its contractors in circumstances where a dispute flares over a contractor’s entitlement to payment.

"Linfox submits that should such a clause not be included hirers will be required to make payments to contractor drivers, who may not be entitled to such payments, and then commence litigation to recover any funds," it says.

"Such a process would invite unnecessary litigation and costs for both hirers and contractor drivers."

Furthermore, Linfox wants trucking companies and supply chain participants to be permitted to audit the books of contractors. It says audits will create an incentive for contractors to act safely and comply with road transport laws.

The RSRT will next week begin hearings on the feedback it received on the draft order.


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