key takeaways
How we got here
Key Changes
Minimum Safety Net
Unfair Termination Claims
From 26 February 2025, eligible regulated road transport contractors will have access to a new unfair dismissal style regime through via the FWC. Road transport contractors may qualify for this scheme if they are engaged as an individual, through a company where they are a director or a family member of a director, through a trust if they are trustee, or through a partnership if they are a partner.
To make a claim, eligible road transport contractors must have been engaged under a services contract for at least six months and earn below the high income threshold for contractors (currently $175.000 per year, subject to yearly adjustments). Claims must be lodged within 21 days of contract termination. There is also a similar jurisdiction in relation the ‘unfair deactivation’ of employee-like workers from digital platforms.
When assessing claims, the FWC will refer to the Road Transport Industry Termination Code, which has not yet been published at the time of writing. If the termination was unfair, the FWC can order that a new contract be entered into with the driver, or that compensation be paid.
Road Transport Collective Agreements
A new system has been introduced to allow bargaining between regulated road transport contractors and the businesses that engage them. This mirrors enterprise bargaining but is designed for contractors rather than employees.
Unions representing road transport contractors can negotiate better minimum terms and conditions on behalf of those contractors. The Fair Work Act sets out notice and requirements that must be followed, to try to ensure that any potentially covered workers are informed of the commencement of the bargaining process. And while the FWC will play a role in overseeing the process and resolving disputes, it cannot impose agreements through arbitration. If an agreement is reached, it must be registered with the FWC, which will ensure that it provides more beneficial terms than any applicable minimum standards order.
Unfair Contract Terms
Last year, we told you about significant updates to the Australian Consumer Law to enhance protections, and in turn the risks for businesses, in relation to unfair contract terms (UCT) (article accessible here). The Fair Work Act now includes its own UCT framework, which applies to services contracts where the contractor earns below the high-income threshold.
The FWC is now empowered to deal with disputes regarding UCT in services contracts. Whether a contract term is considered unfair will need to consider:
We recommend reviewing your current contracts and templates to ensure compliance with the new UCT provisions.
TWU Applications
Minimum standards orders
The TWU has filed three applications with the FWC seeking minimum standards orders for:
The FWC is currently considering referring these applications to its Road Transport Advisory Group (RTAG), which must consult any subcommittee that has been established to advise. Submissions were open until 27 September 2024, with final recommendations expected from the RTAG by 6 December 2024
ROAD TRANSPORT CONTRACTUAL CHAIN ORDER
The TWU has now also filed a fourth application, seeking a road transport contractual chain order. The application seeks to impose minimum standards across contractual chains containing at least one corporation, for the road transport of goods including materials, meats, dairies, resources, vehicles, and waste. The minimum standards would include, in summary:
The FWC is expected to shortly issue a statement including directions for interested parties who wish to be part of its consideration process regarding this application for the first road transport contractual chain order.
How MCW can help you
If your business operates in the road transport industry, you might be affected by these TWU applications, or future applications by the union or the FWC itself. We can help you prepare and submit any necessary documentation to protect your interests.
We are excited to present our inaugural and exclusive Transport Industry Seminar in early 2025. Please visit our Events page regularly for more details.
We are also well placed to assist with any unfair termination or deactivation cases once these regimes take effect from February 2025. We are also experienced in enterprise bargaining and contract reviews, so we can help you remain compliant with the new regulations across the road transport industry.
At McInnes Wilson Lawyers, we specialise in helping businesses navigate regulatory changes. For tailored advice and solutions, contact Ryan Murphy. Let us help you stay ahead of the changes and ensure your business is fully compliant with the new legislation.
Principal
Don't Miss a Beat
Subscribe to MCW Insights
Still Have Questions?
Make an Enquiry