ALC and ANRA line up to shoot down TWU’s proposal to Road Safety Remuneration Tribunal for new obligations on retailers
By Brad Gardner | April 24, 2013
The Transport Workers Union’s (TWU) plans to impose new obligations on retailers has hit opposition from the Australian Logistics Council (ALC) and the Australian National Retailers Association (ANRA).
Both groups have lobbed lengthy written rebuttals with the Road Safety Remuneration Tribunal (RSRT) against the union’s proposals that seek to cover retail and the long distance sectors.
The TWU last month wrote to the tribunal asking it to introduce road safety remuneration orders requiring the likes of Coles and Woolworths to pay a training levy.
The proposals also called for parties to meet new obligations to ensure employee drivers of transport contractors were paid for all time worked and that owner-drivers received full cost recovery.
ALC Managing Director Michael Kilgariff and the ANRA say the union’s proposals on safety and pay overlap with existing laws covering heavy vehicles, employment standards and workplace health and safety laws.
The ANRA has taken issue with the proposal to allow drivers and owner-drivers to chase customers directly if the transport company fails to pay them for work performed.
It claims customers may be liable even if a transport company does not reimburse drivers or owner-drivers for reasons beyond customers’ control.
“For example, a transport service provider might become insolvent through bad management or as a result of external or unforeseeable circumstances (such as climatic conditions affecting supply, industrial action disrupting its business, or breakdown of machinery),” the ANRA writes.
“A consignor, consignee, or intermediary should not be required to bear such commercial risks. In virtually no other industry is a client effectively expected to bear the commercial risk of the failure of the business of a service provider.”
While opposing the union’s recommendation, the ANRA adds that if the RSRT supports the measure then it should limit it to where a consignor, consignee or intermediary deals directly with small transport operators.
Furthermore, it says there should be a protection for parties if they have taken reasonable steps to ensure payment is made.
Both responses from the ANRA an the ALC argue that requiring consignors and consignees to ensure drivers of transport contractors are paid enough is unreasonable because they are unlikely to have knowledge of and access to the operational and financial information of transport companies.
“Major transport providers must be responsible for managing their own affairs, and should bear the risk of any failure to properly do so,” the ANRA argues.
Kilgariff says the inclusion of the phrases such “full recovery of reasonable costs” and a “reasonable profit margin” in the TWU’s proposals are vague as to be uncertain.
He also touches on the TWU’s bid to make supply chain customers cover transport operators’ cost of developing safe driving plans.
Kilgariff says it risks becoming a complex burden on businesses because of the cost of producing a safe driving plan across different classes of customers. He has also rejected the impost of a fixed rate for driving plans.
“If a flat fee is charged to cover safe driving plans…an incentive may be created to overcollect from, in particular, consignors, consignees and intermediaries for goods carried by (for example) multiple consignment loads, shared loads or home and business deliveries,” Kilgariff writes.
He refers to the recommendation for a training levy as a form of double dipping because customers already take into account training costs when negotiating contracts with transport companies.
“Imposing a training levy on consignors, consignees and intermediaries would constitute double payment by the end-use for the same cost,” he says.
The ANRA agrees, labelling the union’s suggestion “wholly inappropriate”.
“It is entirely inappropriate to oblige consignors, consignees and intermediaries to effectively pay twice for training of employees and contractors engaged by major transport service providers,” the group says.
Kilgariff says the union’s plan does not outline how much safety will improve under its proposals or how much cost will be imposed on the supply chain.
The RSRT is required to consider complexity, the compliance burden on business and the viability of firms in the industry when deciding to issue a road safety remuneration order.
Kilgariff claims the TWU’s proposal “fails the test” in each area.
The ALC has, however, supported the Australian Road Transport Industrial Organisation’s (ARTIO) submission, which covers the linehaul sector and recommends the creation of a cost model to allow parties to set individual rates to suit their needs.
The RSRT has committed to consulting the industry before issuing any road safety remuneration orders, which can mandate rates and conditions a sector or sectors must meet.
