ROAD TO RE­PEAL

Em­bold­ened by staunch in­dus­try re­sis­tance to the RSRT, Canberra rode to the res­cue af­ter ef­forts failed to halt the RSRO

Australian Transport News - - Contents - Words / Anjali Behl, Brad Gar­diner and Rob McKay

Em­bold­ened by in­dus­try re­sis­tance to the Road Safety Remuneration Tri­bunal, Canberra stepped in af­ter ef­forts failed to halt the Con­trac­tor Driver Min­i­mum Pay­ments Road Safety Remuneration Or­der 2016. On April 1, the eve of the tri­bunal’s de­ci­sion on the im­ple­men­ta­tion of the or­der, the gov­ern­ment re­leased two in­de­pen­dent re­ports crit­i­cal of the Road Safety Remuneration Sys­tem

In De­cem­ber 2015, the Road Safety Remuneration Tri­bunal ( RSRT) made a world first or­der to man­date com­pul­sory hourly and kilo­me­tre pay­ments for con­trac­tor driv­ers in­volved in line­haul and su­per­mar­ket work, start­ing April 4 this year.

The move was de­signed to pro­vide con­trac­tors with a safe and sus­tain­able rate to pre­vent them from cut­ting cor­ners – such as fore­go­ing main­te­nance and work­ing longer – to make ends meet.

The Con­trac­tor Driver Min­i­mum Pay­ments

Road Safety Remuneration Or­der 2016 was due to run un­til at least April 3, 2020, and in­cluded an­nual rate in­creases of two per cent.

Un­der the rul­ing, con­trac­tor driv­ers were guar­an­teed pay­ment within 30 days for time spent wait­ing, load­ing or un­load­ing and time spent in­spect­ing or at­tend­ing to a load, re­fu­elling a truck, record­ing in­for­ma­tion or com­plet­ing a doc­u­ment, and wait­ing in a lo­ca­tion be­cause of a nat­u­ral disaster.

All par­ties in the sup­ply chain were ac­count­able for mak­ing sure rates in con­tracts were suf­fi­cient to en­sure owner-driv­ers re­ceive the min­i­mum rate, which was to vary based on the work be­ing per­formed and the type ve­hi­cle be­ing used.

The min­i­mum rates or­der was based on stud­ies that linked road safety with driver remuneration, with ad­vo­cates of the scheme claim­ing that set­ting stan­dard min­i­mum pay for driv­ers would usher re­sourc­ing and sup­ply chain ef­fi­ciency.

Some re­ports have in­di­cated that driv­ers can wait up to 120 days to re­ceive pay­ments, which puts them un­der fi­nan­cial pres­sure that of­ten re­sults in them cut­ting cor­ners to fin­ish a job and forego stan­dard safety pro­ce­dures in or­der to pick up more work.

Less than a few weeks be­fore the or­der was due to start, the union an­nounced its plan to push for even higher rates once min­i­mum fixed rates were im­ple­mented.

CRIT­I­CISM

The Or­der came in the face of a joint sub­mis­sion by the na­tion’s two big­gest trans­port com­pa­nies, Toll and Lin­fox, urg­ing the tri­bunal to “tread cau­tiously” be­fore reg­u­lat­ing the sec­tor.

While the com­pa­nies ex­pressed sup­port for min­i­mum pay rates for line­haul driv­ers, their sub­mis­sion ar­gued that set­ting rates for line­haul work would be dif­fi­cult given the numer­ous types of ve­hi­cles used in the sec­tor, the dif­fer­ing fuel burn rates due to the var­i­ous types of freight trans­ported, and the dif­fer­ent amounts paid for trips be­tween re­gional and cap­i­tal cities.

Hav­ing an­a­lysed the im­pact of the or­der on busi­ness, the two com­pa­nies said they would

con­tem­plate re­duc­ing its con­trac­tor driver fleet to off­set the in­crease in op­er­a­tional costs as a re­sult of higher pay rates for driv­ers.

Crit­ics have ac­cused the RSRT of tak­ing a ‘one size fits all’ ap­proach without con­sid­er­ing the com­plex­i­ties of the sec­tor to es­tab­lish ap­pro­pri­ate rules.

Op­po­nents of the or­der have said the scheme would lead to many mum and dad busi­nesses los­ing their liveli­hoods.

NatRoad was one of the first in­dus­try bod­ies to come out swing­ing against the or­der, claim­ing it would not only ruin many small trans­port busi­nesses and own­er­drivers, but also sig­nif­i­cantly in­crease the price of con­sumer goods – claims that were rub­bished by the union.

ATN spoke to op­er­a­tors who high­lighted what they saw as the RSRO’s flawed ap­proach mak­ing it im­pos­si­ble for owner-driv­ers to con­tract sin­gle loads or short-term work.

Oth­ers said they needed more time to make op­er­a­tional and ad­min­is­tra­tive ad­just­ments to com­ply with the sig­nif­i­cant trans­for­ma­tional changes.

Is­sues such as am­bi­gu­ity in the terms used in the or­der, lack of a ver­i­fi­ca­tion sys­tem to mon­i­tor driv­ers’ hours and kilo­me­tres, in­flex­i­ble ex­ist­ing con­tracts to off­set costs, and the over­all re­or­gan­i­sa­tion costs posed a threat to busi­nesses re­main­ing com­pet­i­tive in the mar­ket.

Some op­er­a­tors had also ex­pressed philo­soph­i­cal ob­jec­tion to leg­isla­tive con­trol over pri­vate busi­nesses.

MUD­DLED MIRE

With in­dus­try play­ers re­port­ing dif­fi­cul­ties in find­ing de­tails about the new rules, the Fair Work Om­buds­man an­nounced its role in ed­u­cat­ing and in­form­ing the in­dus­try, and

mon­i­tor­ing com­pli­ance with the Road Safety

Remuneration Act 2012.

It was fol­lowed by per­sis­tent com­plaints about lack of use­ful in­for­ma­tion and con­fu­sion with re­gard to the com­plex­i­ties of the or­der.

Dur­ing an in­dus­try and cus­tomer break­fast or­gan­ised by the Aus­tralian Road Trans­port In­dus­trial Or­gan­i­sa­tion (AR­TIO) in Sydney on Fe­bru­ary 9, RSRT pres­i­dent Jen­nifer Ac­ton out­lined the bare bones of the or­der, leav­ing at­ten­dees dis­grun­tled over the lack of clear guid­ance.

On March 3, the RSRT launched an on­line pay­ment cal­cu­la­tor with an aim to as­sist driv­ers, hir­ers and par­tic­i­pants in the sup­ply chain to cal­cu­late min­i­mum pay­ments un­der the new or­der.

How­ever, the Aus­tralian In­dus­try Group (Ai Group) slammed the tri­bunal for re­leas­ing the on­line pay cal­cu­la­tor too late and com­plained that hir­ers did not have enough time to im­ple­ment ap­pro­pri­ate ad­min­is­tra­tive ar­range­ments.

Less than a fort­night be­fore the due date, the FWO was still try­ing to come to grips with the tech­ni­cal­i­ties of the scheme.

The one sim­pli­fi­ca­tion the Om­buds­man was able to of­fer was to re­de­fine the mean­ing of the term ‘con­trac­tor driver’, as pro­posed by the AR­TIO.

The new mean­ing stated that work per­formed by a con­trac­tor driver’s em­ployee driv­ing another truck also owned by the con­trac­tor driver would come un­der the ‘safe rates’ RSRO.

OP­PO­SI­TION

Less than a month be­fore the scheme was due to start, the tri­bunal an­nounced a hear­ing to deal with ap­pli­ca­tions from the Aus­tralian Long Dis­tance Owner Driv­ers As­so­ci­a­tion (ALDODA), the Na­tional Road Freighters As­so­ci­a­tion (NRFA), and NatRoad.

The hear­ing was sched­uled for March 15 in Bris­bane, with video links to in­ter­state.

In the days fol­low­ing, mo­bil­i­sa­tion against the ‘safe rates’ RSRO stepped up another gear, with more and more in­dus­try bod­ies link­ing arms to have the or­der de­layed.

The Ai Group, in as­so­ci­a­tion with NatRoad, also sub­mit­ted an ap­pli­ca­tion to stay the start of the or­der and have in place tran­si­tional ar­range­ments to phrase-in the new rates.

It was fol­lowed by the Aus­tralian Live­stock and Live­stock Trans­porters As­so­ci­a­tion (ALRTA), Na­tional Farm­ers Fed­er­a­tion (NFF) and the Coun­cil of Small Busi­ness As­so­ci­a­tions (COSBOA) join­ing the bid to stay the or­der in­def­i­nitely, or at the very least de­lay the or­der for six months.

In­dus­try par­tic­i­pants also high­lighted the im­pact of ex­pected mar­ket up­heaval on own­er­drivers was be­ing ig­nored.

South Aus­tralian Road Trans­port As­so­ci­a­tion (SARTA) pres­i­dent Steve Shearer high­lighted that the or­der could force pres­sured owner-driv­ers to ex­treme ac­tions in­clud­ing sui­cide.

TWU mem­bers launched a rally to cham­pion the RSRO in down­town Ade­laide.

It was fol­lowed by a rally of close to 100 peo­ple and con­voy by owner-driv­ers in Ber­rinba, Queens­land to protest against the or­der.

The rally at­tracted po­lit­i­cal sup­port, with Queens­land se­na­tor Glenn Lazarus speak­ing at the event to de­clare he would fight against the RSRT’s plans.

A sec­ond such rally took place in Ade­laide, with trans­port op­er­a­tors, min­is­ters and mem­bers of the SARTA protesting out­side the Par­lia­ment House fol­lowed by an an­tiRSRT con­voy.

CON­SUL­TA­TION

Fol­low­ing the Bris­bane hear­ing, the RSRT set aside the fol­low­ing two weeks to deal with ar­gu­ments re­lated to the or­der.

Ac­ton is­sued a draft vari­a­tion deal­ing with var­i­ous pro­pos­als con­cern­ing start date and tran­si­tional pro­vi­sions, in­clud­ing the Ai Group’s pro­posal to phase-in the new rules over a 36-month pe­riod.

The tri­bunal re­ceived a huge num­ber of sub­mis­sions re­lated to the draft, with most re­quest­ing to de­fer the or­der.

Par­ties, whose sub­mis­sions were deemed to need fur­ther in­ves­ti­ga­tion, were asked to ap­pear for cross-ex­am­i­na­tion over a three-day pe­riod dur­ing the Easter hol­i­days.

With a threat of six months jail time for nonat­ten­dees, the hear­ings sparked wide­spread crit­i­cism from the in­dus­try.

Chang­ing its orig­i­nal stance, the union said it was not op­posed to the pro­posed Oc­to­ber 1 dead­line. It also sought changes to the RSRT’s or­ders to pre­serve split loads and back loads.

The TWU sub­mis­sion, ti­tled TWU1, was backed by Lin­fox and Toll, and par­tially sup­ported by the Ai Group.

How­ever, most of the sub­mis­sions re­jected the pro­posal on the de­tails, or be­cause it ar­rived out­side pre­vi­ously un­der­stood lim­its, or be­cause of its nar­row prove­nance – but some op­posed it for in­ter­fer­ing with the RSRO as it then stood.

The Aus­tralian Cham­ber of Com­merce and In­dus­try, as well as the NSW Busi­ness Cham­ber and its af­fil­i­ate, Aus­tralian Busi­ness In­dus­trial, pre­sented a sub­mis­sion to the RSRT stat­ing there was wide­spread con­fu­sion and anx­i­ety within the in­dus­try.

GROW­ING IN­VOLVE­MENT

While the fed­eral gov­ern­ment hitched it­self to the in­dus­try band­wagon to stall the or­der, it was pow­er­less to stop the scheme from go­ing ahead.

The gov­ern­ment warned the tri­bunal of in­ad­ver­tent non-com­pli­ance by trans­port com­pa­nies that could lead to fines up to $54,000 in its sub­mis­sion, backed by em­ploy­ment min­is­ter Michaelia Cash and trans­port min­is­ter Dar­ren Ch­ester.

As the of­fice’s first or­der of busi­ness, Aus­tralian Small Busi­ness and Fam­ily En­ter­prise Om­buds­man (ASBFEO) Kate Car­nell voiced her opin­ion against the RSRO.

A for­mer small busi­ness owner, politi­cian and in­dus­try body leader, Car­nell told ATN the RSRT’s in­tru­sion into a sec­tor that had been largely un­charted by the in­dus­trial re­la­tions sys­tem was a sur­prise.

Fi­nance bro­kers raised alarm over the im­pact of the or­der on the Aus­tralian econ­omy.

The Com­mer­cial As­set Fi­nance Bro­kers As­so­ci­a­tion of Aus­tralia (CAFBA) said it re­ceived wide­spread client con­cern about their ve­hi­cle and other loan sit­u­a­tions in fu­ture, caus­ing it to pro­pose an in­def­i­nite stay to the or­der.

RE­VIEW RE­PORTS

On April 1, the eve of the tri­bunal’s de­ci­sion re­gard­ing the im­ple­men­ta­tion of the or­der, the gov­ern­ment re­leased two long­buried re­ports ex­am­in­ing the Road Safety Remuneration Sys­tem.

The Price wa­ter house Coop­ers’ (PwC )2016 re­port painted an un­flat­ter­ing assess­ment of the tri­bunal, in­clud­ing ar­gu­ing its ac­tions were do­ing more harm than good and that it should be axed.

It claimed the RSRT would cost the econ­omy more than $2 bil­lion over 15 years, but de­liver noth­ing close to that fig­ure in terms of ben­e­fits.

The re­view added that the money spent on the RSRT since it opened its doors in 2012 had not been worth it.

PwC, which au­thored a reg­u­la­tory im­pact state­ment on the RSRT be­fore its in­tro­duc­tion, said it could not sub­stan­ti­ate the on­go­ing need for the sys­tem.

The 2014 Jaguar Con­sult­ing re­port was fi­nally un­veiled. It rec­om­mended sweep­ing changes to the struc­ture of the agency.

Re­port au­thor Rex Deighton-Smith said the ev­i­dence used to jus­tify the link be­tween low rates of pay and safety was flimsy at best and that ex­ist­ing mea­sures such as chain of re­spon­si­bil­ity (COR) and the Na­tional Heavy Ve­hi­cle Reg­u­la­tor (NHVR) could be re­lied upon to im­prove safety in the truck­ing in­dus­try.

The first rec­om­men­da­tion stated that RSR Sys­tem should not con­tinue in its cur­rent form, the sec­ond stated that the pro­vi­sions of the Act au­tho­ris­ing the tri­bunal to set manda­tory rates should be re­pealed.

ON THE AT­TACK

The RSRT de­cided not to de­lay the in­tro­duc­tion of the or­der, rul­ing in favour of the due date of April 4.

The tri­bunal used its de­ci­sion re­port to take its crit­ics to task, ac­cus­ing them of

cre­at­ing un­cer­tainty and con­fu­sion within the com­mu­nity. It also slammed the Om­buds­man for not of­fer­ing enough in­for­ma­tion to af­fected par­ties.

How­ever, it high­lighted that the onus was on the in­di­vid­u­als to know what was hap­pen­ing.

The rul­ing in­voked con­dem­na­tion from in­dus­try bod­ies, which ac­cused the tri­bunal of over­look­ing the im­pact of the or­der on small busi­nesses.

Later that night, the fed­eral court in Bris­bane granted a tem­po­rary stay on the or­der fol­low­ing an ur­gent ap­pli­ca­tion by the ATA and NatRoad.

Mean­while, the gov­ern­ment in­vited sug­ges­tions for best pos­si­ble so­lu­tions to the is­sue.

On April 7, the Depart­ment of Em­ploy­ment an­nounced the sched­ule of the two-hour con­sul­ta­tions fo­rums, held at var­i­ous lo­ca­tions around Aus­tralia from April 11-15.

That same evening, the Fed­eral Court in Bris­bane lifted the tem­po­rary stay on the or­der, on the ground that there was a “weak prima fa­cie case and no ex­cep­tional cir­cum­stances ex­isted to war­rant the con­tin­u­a­tion of the stay”. The or­der was in force, ef­fec­tive im­me­di­ately.

NatRoad an­nounced its dis­ap­point­ment in be­ing priced out of the war, stat­ing it was no longer fi­nan­cially vi­able for the body to take fur­ther le­gal ac­tion.

Pri­vate con­trac­tor group In­de­pen­dent Con­trac­tors Aus­tralia an­nounced its in­ten­tion to take the case to the High Court, mak­ing a pub­lic plea for fund­ing to sup­port the le­gal bat­tle.

The ATA called for im­me­di­ate gov­ern­ment in­ter­ven­tion in the mat­ter.

It sup­ported Cash’s call urg­ing own­er­drivers to bring their trucks and griev­ances to Canberra in an anti-RSRT rally on Sun­day, April 17.

ATA later re­ported that the con­voy in­cluded close to 200 trucks.

PO­LIT­I­CAL FOOT­BALL

With the start of a long elec­tion loom­ing and the need to con­vince in­de­pen­dent sen­a­tors a high pri­or­ity, prime min­is­ter Mal­colm Turn­bull at­tacked op­po­si­tion leader Bill Shorten for hav­ing formed a body that could lead to the end of hun­dreds of “mum and dad busi­nesses”.

“Now what we have seen is this RSRT, this tri­bunal es­tab­lished by the La­bor Party, es­tab­lished by Bill Shorten, has pro­duced an or­der which will drive owner-driv­ers out of busi­ness,” Turn­bull said.

“It was a piece of leg­is­la­tion that has had noth­ing to do with safety, ev­ery­thing to do with get­ting small busi­nesses, self-em­ployed peo­ple, the en­ter­pris­ing fam­ily busi­nesses of Aus­tralia off the roads.”

Shorten re­turned fire, while hold­ing out the pos­si­bil­ity of a bi­par­ti­san ap­proach.

“There’s a clear cor­re­la­tion be­tween low pay­ment of driv­ers driv­ing through the night, em­ployee owner driv­ers, and in­deed poor safety,” he said.

“We call upon Mr Turn­bull to work with the La­bor Party in en­sur­ing a fair deal for Aus­tralia’s truck driv­ers and in­deed Aus­tralia’s road users.”

The PM an­nounced that if re-elected, his party would ter­mi­nate the RSRT.

Two days later, the gov­ern­ment an­nounced its plan to in­tro­duce leg­is­la­tion to axe the tri­bunal when the Par­lia­ment re­con­vened in the week be­gin­ning April 18.

The an­nounced came af­ter in­de­pen­dent se­na­tor Jac­qui Lam­bie joined sen­a­tors Glenn Lazarus, David Ley­on­hjelm and Bob Day in call­ing for an im­me­di­ate abo­li­tion of the tri­bunal and the RSRO.

The gov­ern­ment set up a tem­po­rary hot­line through the Depart­ment of So­cial Ser­vices to pro­vide tar­geted fi­nan­cial ad­vice to own­er­drivers who had been neg­a­tively af­fected by the pay­ment or­der.

The union made a fresh call to the RSRT to de­lay the or­der to Jan­uary 1 next year – a move NatRoad termed a “po­lit­i­cally mo­ti­vated mon­u­men­tal backflip”.

Se­na­tor Ricky Muir, the union and sup­port­ers of the or­der in­clud­ing Long­haul Driv­ers As­so­ci­a­tion (LDA) pres­i­dent Brian Turpie asked politi­cians to weigh the con­cerns of all sides be­fore mak­ing a de­ci­sion.

On April 18, the Coali­tion tabled two pro­pos­als – the first to abol­ish the RSRT and its re­lated min­i­mum rates or­der, and sec­ond, to de­lay the im­ple­men­ta­tion date to Jan­uary 1 next year.

The fed­eral par­lia­ment voted in favour of the abo­li­tion of the tri­bunal, 36 votes to 32.

The vote meant the RSRT and the Con­trac­tor Driver Min­i­mum Pay­ments Road Safety Remuneration Or­der 2016 was to be ter­mi­nated ef­fec­tive Thurs­day, April 21.

WHAT NEXT?

The TWU has promised to con­tinue its fight for the liveli­hoods and safety of truck driv­ers.

On April 20, it or­gan­ised a rally in Canberra with fam­i­lies of driv­ers who lost their lives in road ac­ci­dents.

It ac­cused the ATA, of which it is a mem­ber, of ig­nor­ing the con­cerns of in­dus­try mem­bers and sup­port­ing big com­pa­nies.

With La­bor still in favour of the tri­bunal, if it comes to power in the July elec­tions, the spec­tres of the rates regime could resur­face with the ta­bles turned.

ABOVE: Deputy prime min­is­ter Barn­aby Joyce, front right, with protesters in Canberra OP­PO­SITE: Op­po­nents to the RSRO turned up in num­bers with their trucks

BE­LOW: In­de­pen­dent se­na­tor Glenn Lazarus ad­dresses an anti-RSRT rally in Queens­land

TOP: Anti-RSRT sen­ti­ments on trucks out­side its head­quar­ters in Mel­bourne dur­ing the Easter hear­ings; ABOVE : RSRT pres­i­dent Jen­nifer Ac­ton speaks to the in­dus­try

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