Trucking groups, operators lodge concerns about fixed rates for owner-drivers

Linfox and Toll are among those to raise issues with proposed minimum rates for owner-drivers.

Trucking groups, operators lodge concerns about fixed rates for owner-drivers
Toll claims the RSRT's minimum rates proposal will likely lead to less work for owner-drivers.


A significant grouping of road freight operators and their customers has joined calls for the Road Safety Remuneration Tribunal (RSRT) to recast its proposal to introduce minimum pay rates for owner-drivers.

The draft Contractor Driver Minimum Payments Road Safety Remuneration Order has been under concerted attack from industry representative bodies, including the Australian Long Distance Owner and Drivers Association (ALDODA), the South Australian Road Transport Association (SARTA) and the Australian Livestock and Rural Transporters Association (ALRTA).

Now NatRoad, Road Freight New South Wales and the Australian Industry Group (Ai Group) have combined to have a crack, though NatRoad has already blasted the proposal by saying its membership believes there are holes in it.

The grouping’s submission, led by the Ai Group, argues compliance with the proposed January 1 start date is unrealistic.

"It is unreasonable to expect that hirers will be able to accommodate significant increases in the costs associated with the engagement of contractor drivers," the submission says.

"More significantly, it is unrealistic to expect that hirers will be able to meet increases without significant advance notice of the obligation."

The lack of exemption for specialised sectors is of concern, with uniform and inflexible regulation for its own sake on widely differing supply chain arrangement is argued against.

The submission also raises the possibility of conflict with the Australian Competition and Consumer Commission (ACCC) over pricing freedom it says is protected under the Competition and Consumer Act and its aim "to enhance the welfare of Australians through the promotion of competition".

The grouping’s submission notes the draft order has complex implications along the supply chain that need further investigation, including cost-recovery, a theme Linfox takes up in its own submission.

Linfox backs the thrust of the draft but it wants provision for a system of recovering increases by the hirer.

"Linfox submits that should the clause be included in the Order this will encourage transparency in the supply chain and allow the hirer to recover the costs without impacting upon the road transport driver or create downward pressure on the supply chain," the company writes.

It also calls for the various driver payment means, including "box rates, trip rates, pallet rates and the like", to be recognised and raises the issue of the draft order’s conflict with fatigue break payments rulings in NSW, which are unpaid under an Industrial Relations Commission ruling.

Toll, while not opposing an order being made, joins those industry bodies warning that the use of owner-drivers in the supermarket sector is likely to be curtailed due to the increased cost involved.

It puts the increases at 20-30 per cent, and up to 55 per cent in regional areas and seeks a ‘lowest cost fit-for-purpose’ model be used.

The company believes the proposed rates, drawn from work done by KPMG, are not realistic.

"Toll’s consideration of the KPMG Report is that many inputs to make up the rates proposed are incredibly inflated or overstated and not experienced within the industry," Toll’s submission says.

"Likewise, in many instances, hours of work performed in the supermarket distribution and long distance sectors are not accurately reflected.

"This, together with assumptions that all Owner-Drivers only provide their vehicle for use for 48 weeks of the year results in an underestimation of annual kilometres travelled, and a high base on which to spread fixed costs of business."

It also views the audit requirements through the supply chain to be "burdensome and over-regulatory".

KPGM’s report is also questioned on its treatment of goods and services tax, particularly on ‘representative vehicles’ and taken to task over its understanding of fuel issues repair and maintenance,  tyre cost, hours worked per week and time worked.

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