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Supply chain enforcement key to guaranteeing payment for owner-drivers

Ombudsman must target trucking industry’s customers to ensure RSRT remuneration order is complied with.


The agency tasked with enforcing minimum pay rates for owner-drivers is being urged to focus on the parties high up the supply chain to ensure compliance with the new remuneration regime.

The Fair Work Ombudsman (FWO) will be responsible for making sure owner-drivers receive their correct entitlements when they take effect on April 4, and the Transport Workers Union (TWU) says the best way to do so is not targeting individual trucking companies.

TWU national assistant secretary Michael Kaine says the agency will get better results if it goes after customers at the top of their respective supply chains because doing so will have a cascading effect.

The Road Safety Remuneration Tribunal’s (RSRT) order mandating minimum payments for contractor drivers in the supermarket distribution and linehaul sectors includes provisions holding the likes of hirers, consignors and consignees accountable for ensuring drivers receive their correct entitlements. 

The TWU has long argued many trucking companies have struggled to pay sub-contractors a sustainable rate because of the low rates they receive from parties higher up the chain.

“It’s important that companies, hirers, pay these owner-drivers correctly but if we want sustainable change it is important those new supply chain provisions that are in the order are enforced,” Kaine says.

“If you enforce those supply chain provisions you get to a much greater chunk of the sectors than if you were to go company by company, and that’s the whole point.

“What we want is for the Ombudsman to be going to the top of the supply chain and ensuring that the likes of the major retailers are held to account about this.”

Kaine says the inclusion of supply chain regulation is “a massive leap forward” in ensuring contractor drivers receive their entitlements.

“That is what is the breakthrough factor in this decision, a world first. You’ve got a supply chain provision that expressly says that those at the top of the chain have got to take steps to ensure drivers are paid and treated in accordance with the order,” he says.

Handed down just prior to Christmas 2015, the order outlines minimum kilometre and hourly rates that must be paid to contractor drivers engaged in supermarket distribution and linehaul work. The order, once introduced, will require payment for time spent queuing, filling out work diaries, taking mandatory fatigue management rest breaks and more.

Kaine says the RSRT ruling marks “a massive win for small businesses” because it recognises the struggle owner-drivers face trying to secure sustainable rates.

“This is about creating sustainable small businesses that can contribute to the sector in an ongoing and stable way, and that is a massive breakthrough in anyone’s language,” he says.

“They shouldn’t have to be subject to terms and conditions which force them to work below cost recovery.”

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