Smaller contractors get collective bargaining power

Registered organisations representing road transport contractors have been given a new ability to make collective agreements with road transport businesses under the Federal Government’s Closing Loopholes Bill passed by the Senate earlier this week.

Under the legislation, negotiating entities will have obligations to consult and explain the terms of the proposed agreements to workers covered by the agreement, and a finalised agreement must be registered with the Fair Work Commission (FWC) and published on their website, according to a Fact Sheet published by the Department of Employment and Workplace Relations.

What’s more, road transport contractors will have a new ability to apply to the Commission for assistance if their services contract has been unfairly terminated. The new ‘unfair termination’ dispute resolution process will be available to contractors who have performed work under a services contract for a road transport business for at least 12 months.

Moreover, the Bill – which is supported by unions, employer associations and operators – gives the FWC the power to issue mandatory orders across the road transport contract chain covering key terms about: payment times; fuel levies; rate reviews; termination, including one-way termination for convenience; and cost recovery.

It cannot include certain terms, such as overtime rates, rostering arrangements or terms that would change the form of engagement of road transport contractors covered by the order; terms on matters that are primarily of a commercial nature that do not affect the terms and conditions of engagement of workers; and matters relating to work health and safety and national heavy vehicle safety that are otherwise comprehensively dealt with by other laws.

Applications for minimum standards can be made by a road transport business, a registered organisation representing road transport workers or businesses, or the Minister for Employment and Workplace Relations. The Commission may also set minimum standards on its own motion, either in the form of in the form of a mandatory Minimum Standards Order or non-binding Minimum Standards Guidelines.

ATA Chair David Smith says the organisation has worked hard and co-operatively with the Government to ensure the Commission’s new powers are “workable and fair”.

“We were not able to achieve our goal of restricting the commission from setting minimum rates. That argument will now need to be put to the Commission as it considers applications for orders,” he concedes.

“But we were able to secure legislation that will work and that could deliver better contract terms for owner drivers and trucking businesses.”

Smith notes the Commission will be required to have regard to the need to avoid adverse impacts on the “sustainability, performance and competitiveness of supply chains and the national economy” when making orders.

“In looking at road transport contractual chain orders, it will also need to have regard to the commercial realities of the road transport industry, including commercial practices in relation to part load, mixed load, no load, multi-leg and return trips,” he adds.

TWU National Secretary Michael Kaine and Natroad CEO Warren Clark – transport unions and associations have united to push for regulation to enforce safer, fairer and more sustainable standards

Under the Bill, there’s a requirement for a 12-month notice of intent period for any proposed order.

“There will be failsafe mechanisms including internal merits review and new rights for the minister or another party to seek a review of an order if significant new facts or evidence come to light,” Smith points out.

“Contractual chain orders are intended to ensure that all parties are covered. We cannot afford a situation where some businesses regulated by the Commission lose work to businesses that are not.”

To that end, Australian Road Transport Industrial Organisation Secretary Peter Anderson notes the legislation gives road transport operators the “necessary protections to stave off exploitative gig competition that threatened to take down traditional transport operators”.

“This legislation will bring positive change to our industry. It is a triumph of our unity that this reform has now passed. Unlikely allies came together over the shared goal to make transport fair, sustainable and viable. If the industry remains united, the future is bright for the transport industry,” he says.

Transport Workers’ Union (TWU) National Secretary Michael Kaine explains the legislation ensures “gig economy workers” gain rights and protections that cannot be evaded by words in a contract or a classification label.

“The passing of this Bill is a watershed moment for the transport industry which has united to push for regulation to enforce safer, fairer and more sustainable standards. This reform will save lives, will quell the threat of exploitative gig competition, and will make transport businesses more viable.

“This is a sophisticated, world-first solution to a global industrial crisis. Australia is leading the way to eradicating century-old exploitation that resurfaced under the guise of new-fangled tech,” he says.

National Road Transport Association CEO Warren Clark says the legislation must now be “sensibly implemented to help make transport more viable, boost productivity and support the economy”.

“We all want a safe and sustainable transport industry. We can’t and shouldn’t keep losing operators to insolvency,” he says.

“My members and I will be working diligently to drive those outcomes but we can’t do it alone. The entire industry and governments must work together to establish standards that will enable road transport to thrive.”

Looking forward, Smith says industry, the Transport Workers Union (TWU) and customers now need to work together to consider the sort of orders that are needed to protect trucking businesses and owner drivers, “without halting innovation or making it impossible to operate”.

“The Bill requires the Commission to engage genuinely with the industry. If a proposed order is good for industry, it will not be opposed by affected operators,” he says.

The Commission will gain its new powers six months after the Bill is signed by the Governor-General.