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Fixed rates for owner-drivers should begin in July 2016, VTA says

Trucking group supports proposed new payment system for owner-drivers, but wants changes made.


The Victorian Transport Association (VTA) has backed minimum pay rates proposal for owner-drivers but wants changes made before it is introduced, including delaying the start date.

While some parts of the industry have rejected the Road Safety Remuneration Tribunal’s (RSRT) plan to fix rates for owner-drivers involved in supermarket chain and long distance work, VTA CEO Peter Anderson says it supports an order being made.

However, he adds that the RSRT’s proposed January 1, 2016 start date is not ideal and should be shifted to July 1.

“It is the view of the Association that the commencement date of 1 January 2016 is a particularly difficult time within the road transport industry,” Anderson writes in a submission to the RSRT.

“The lead time between the making of any (final) Order and its proposed commencement is likely to be very short in an extremely busy pre-Christmas period, with the commencement time occurring when the administration of vast numbers of transport providers are likely to be on leave or in close down.”

Anderson has also taken issue with the KPMG cost model used to determine the proposed rates structure, saying it makes “erroneous assumptions” and has resulted in inflated costings.

He says fuel costs should not be fixed and has proposed “a floating amount adjusted monthly upon the published fuel price and fuel efficiency calculations as agreed between the parties”.

Anderson adds that the RSRT’s plan for rates to increase by 3.2 per cent annually from January 2016 to December 31, 2019 — the date when the payments system will be reviewed — should be revised.

The VTA wants the tribunal to determine payment increases on an annual basis.

“The Association has particular concerns of extrapolating a fixed annual rate increase over a 4 year period,” Anderson writes.

If implemented unchanged, the RSRT’s rates proposal will lead to eligible owner-drivers being paid for rest breaks required under fatigue management law.

It would mark a change in current practices for contractor and employee drivers and is a measure the VTA does not support.

“In all of the circumstances the VTA recommends the preservation of the status quo in respect of the question as to whether short rest breaks are paid or unpaid,” Anderson says.

The VTA has also identified a potential pitfall with the RSRT’s plan to limit the scope of minimum payments to owner-drivers engaged in work for supermarket chains. Anderson says this has the effect of excluding goods destined for sale at local retailers, thereby introducing two payment standards.

“We make the observation that a road transport service under a distribution operation not involving goods destined for a supermarket chain will remain outside the scope of the draft Order,” Anderson writes.

The RSRT released its proposed rates order in late August and has since received a number of submissions in response from industry associations, individuals and trucking companies.

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