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 There are several decisions and processes of note which have occurred recently – all of them linked to the Road Transport (Long Distance Operation Award)

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Presentation on theme: " There are several decisions and processes of note which have occurred recently – all of them linked to the Road Transport (Long Distance Operation Award)"— Presentation transcript:

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2  There are several decisions and processes of note which have occurred recently – all of them linked to the Road Transport (Long Distance Operation Award)  As the focus of members has generally been on the Road Transport (Local) Award we provide a brief summary again for clarity of application.

3  The coverage clause of the LDO Award is to be compared to that of the Local Award:  This industry award covers employers throughout Australia in the road transport and distribution industry and their employees in the classifications listed in the Award to the exclusion of any other modern award. However  4.2 This award does not cover employers and employees covered by the Road Transport (Long Distance Operations) Award 2010 whilst undertaking long distance operations; Clearly the LDO overrides the Local Award for Long Distance Operations.

4  A long distance operation is defines as:  any interstate operation, or any return journey where the distance travelled exceeds 500 kilometres and the operation involves a vehicle moving …materials …from a principal point of commencement to a principal point of destination.  interstate operation …involving a vehicle moving …materials …from a principal point of commencement in one State or Territory to a principal point of destination in another State or Territory. Provided that to be an interstate operation the distance involved must exceed 200 kilometres, for any single journey.

5 So, in brief, the essential elements of a Long Distance Operation are either:  a return journey exceeding 500 kilometres; or  an interstate operation that must exceeding 200 kilometres for any journey  If you do an operation/job which fits this description the Long Distance Award will apply

6  Coverage clause of the LDO Award provides:  This industry award covers employers throughout Australia in the private transport industry engaged in long distance operations and their employees in the classifications listed in Schedule A - Classification Structure (Note Drivers only) to the exclusion of any other modern award.

7  The classification structure of the Long Distance Award only refers to Drivers – so only Drivers are covered by this Award.  Offsiders accompanying Drivers on a Long Distance Operation are covered under the Local Award  Remember to look at the classification definitions of the Long Distance Award to determine rates of pay when long distance work is performed

8  After many submissions, conciliations and arbitrations, last month, Senior Deputy President Harrison released her decision regarding changes to the Long Distance Operation Award.  There are several changes to advise which are explained on the following slides.

9  The following definition was inserted: fatigue management rules/regulations means Commonwealth, State or Territory laws controlling driving and working hours of heavy vehicle operators or fatigue management (this impacts on maximum hours and is referred to later in the Award) Previously there was definition in the Award

10  Cl Termination away from home base Where an employer decides to terminate the employment of an employee and the employee is away from their home base, the employer shall provide the employee with the means of returning to home base or reimburse the employee for the cost of any fares reasonably incurred in returning home.

11  Clause 13.1 had the following note included to avoid employer confusion): NOTE: The classification grades are different in the Road Transport and Distribution Award Grade 4 under this award is equivalent to Grade 6 under the Road Transport and Distribution Award 2010.

12  Wherever appearing in the Award - “Travelling Allowance” has replaced the term “Living away from home allowance”  By inserting an additional classification at the beginning of Grade 5 in Schedule A: Grade 5 - Driver of rigid vehicle and heavy trailer combination with GCM over 42.5 tonnes but not more than 53.4 tonnes.  (Fixes the gap between Grade 4 max. of 42.5 and G6 being and nothing in between)

13 New clause 4.2 –  The award does not cover an employee while they are temporarily required by their employer to perform driving duties which are not on a long distance operation, provided the employee is covered by the Road Transport and Distribution Award 2010 while performing such duties. (So confirming that employees will move between the Awards and mirroring 4.2 in the RTD Award.)

14 20.2 Hours of Work and Fatigue Management (replacing the heading ‘hours of work’)  (a) Where applicable, hours of work will be in accordance with Commonwealth, State or Territory laws, relating to the control of driving and working hours of heavy vehicle operators or the management of fatigue.  (b) Where clause 20.2(a) is not applicable hours of work will be as follows:

15 Except where driving hours have been delayed because of accidents or in circumstances over which the employer has no control, the employee must not work and the employer must not require the employee to work:  (i) more than a total of 120 hours in any fortnight exclusive of any unpaid intervals for meals.  (ii) in any one day more than 12 hours, with a break of half an hour after each five and one half hours worked; provided that every employee must have I0 hours off duty immediately after the working period is completed.  (iii) A roster of work which provides for more than 120 hours to be worked in any fortnight.

16 There has been a significant change to the Award by introducing clear ‘ordinary hours’. The below clause was always in the Award (just varied to change 4 weeks to 28 days) Full-time employment  A full-time employee is an employee engaged by an employer for an average of 38 ordinary hours per week over 28 days.

17  However, the following has been added (a) (under Hours of Work) as follows:  (a) The ordinary hours of work shall be an average of 38 hours per week, and may be calculated over a period of not more than 28 days. (Significantly the SDP determined this variation would come into effect on the first pay period on or after 19 March 2012 – reviewed later). It is this addition which has ramifications in respect to the calculation of super entitlements.

18  Clause 20.3 (under Hours of Work) (inserts the Act’s test for determining reasonable additional hours)  An employer may require an employee to work reasonable hours of work at the rates of pay in this award. An employee may refuse hours of work which are unreasonable. In determining whether additional hours are reasonable or unreasonable the following must be taken into account:  (a) any risk to employee health and safety from working the additional hours;  (b) the employee's personal circumstances, including family responsibilities;

19  (c) the needs of the workplace or enterprise in which the employee is employed;  (d) whether the employee is entitled to receive overtime payments, penalty rates or other compensation for, or a level of remuneration that reflects an expectation of, working additional hours;  (e) any notice given by the employer of any request or requirement to work the additional hours;  (f) any notice given by the employee of his or her intention to refuse to work the additional hours;

20  (g) the usual patterns of work in the industry, or the part of an industry, in which the employee works;  (h) the nature of the employee's role, and the employee's level of responsibility;  (i) whether the additional hours are in accordance with averaging terms included under section 63 (Act) in a modern award or enterprise agreement that applies to the employee, or with an averaging arrangement agreed to by the employer and employee under section 64;  j) any other relevant matter

21 24.2 Rate of pay for a period of paid personal/carer's leave and compassionate leave  The rate of pay for an employee who accesses a period of paid personal/carer's leave or compassionate leave must be a portion of the applicable minimum rate prescribed by clause which corresponds to the amount of leave taken. The applicable minimum rate must be that applicable to the classification which the employee would have worked in had they not taken the period of leave.

22 A new clause 26.6 as follows:  An employee will only be entitled to the payments specified in clause 26.4 or clause 26.5 in circumstances where the majority of the work undertaken by an employee on a particular journey or long distance operation is undertaken on a public holiday. (clarifying when public holiday rates will be applicable)

23  As referred to in previous slides – the Modern Award variation in regard to clause 20.1(a) as follows: “the ordinary hours of work shall be an average of 38 hours per week, and may be calculated over a period of not more than 28 days” has had a flow-on impact regarding the calculation of superannuation for long distance drivers.

24 Members will recall that by letter dated 21 January 2013 the Australian Taxation Office (ATO) (referencing ruling SGR2009/2) informed the industry of their view that employers had been incorrectly paying super for long distance drivers. This letter was sent to many employers – including AFRA – and AFRA forwarded it to members to ensure everyone was aware of the ATO view on this matter.

25  The ATO direction in that letter was that as the Road Transport (Long Distance Operations) Award 2010 did not have an Ordinary Hours of Work clause - accordingly for long distance drivers the levy was payable on the total hours worked (so total earnings for the week) discounted by the notional 20% overtime component built into the hourly or Cents Per Kilometre (CPK) rates in the LDO Award.

26 For example: using a grade 6 driver as an example (working a 50 hour week) and current hourly rates and super percentage; under the ATO January 2013 direction the super amount would be:  Hourly driving rate method: $29.91 x 50 hours = $1, (less 20% for o/t loading) x 9.5% = SGL payment of $113.66

27  As indicated in previous slides – SDP Harrison agreed to Employer Submissions to insert an Ordinary Hours Clause into the LDO Award as an outcome of the Modern Award Review process.  As also indicated SDP Harrison also decided this change would operate retrospectively from the 19 th March 2012 – the date the submission to insert an ordinary hours clause in the Review process was first made

28  NRTA has since announced the ATO have advised them they intend to vary the manner in which superannuation for long distance drivers is calculated based upon the change to the Modern Award.  The ATO has not adjusted their website re long distance drivers and we have requested formal written advice from them.

29  NRTA have advised they have received notification from the ATO that the following calculation method will be applied:  on the basis of 38 hours at the hourly driving rate, or 38 hours at the cents per kilometre rate - at the notional rate of 75 kilometres per hour. (It should be noted that the SGL calculation should also include payment of the levy on allowances or bonuses that are paid e.g. dangerous goods, wide loads etc. (excludes travel allowance).

30 Using a grade 6 driver as an example the new calculation would be:  Hourly driving rate: $29.91 x 38 hours = $1, x 9.5% = SGL payment of $  Cents per kilometre rate: 38 75kmh = 2850kms x.3988cpk = $1, x 9.5% = SGL payment of $107.98

31 Our understanding is that the ATO are proposing to vary their definition of Ordinary Time Earnings regarding Long Distance Drivers and to apply that retrospectively from 19 March How that will be effected (ie. address any overpayments since that time) is to be determined. We await their written advice.

32 We sent out an advice to members earlier this year regarding the first decision of the RSRT. The RSRT was implemented in July 2012 – its main functions being to:  make road safety remuneration orders that set out minimum pay and related conditions for road transport drivers  approve road transport collective agreements (collective agreements between hirer’s and contract drivers)  resolve disputes between road transport drivers, their hirers or employers and/or supply chain participants about:

33 The Order commenced application on 1 May 2014 and applies to (relevant to members): long distance operations (which is defined in the Road Transport and Distribution Long Distance Operation Award to mean an interstate operation exceeding 200 km, or a return journey where the distance travelled exceeds 500 km) in the industry of the transportation by road of all materials whether in a raw or manufactured state, or of livestock, throughout Australia. Applies re employee and contract drivers

34 Requirement to have a written contract (& keep 7 yrs)  Before a road transport driver’s employment or contract engagement starts, their employer or hirer must have provided the road transport driver with a written contract. That written contract has to deal with a number of specified matters, including:  the nature of the service to be provided, parties and contract period  the nature of the legal relationship (eg. employer/employee or principal/contractor  what Award or Enterprise Agreement (if any) cover or apply to the road transport driver

35  what rate applies, hourly or kilometre etc. and any guaranteed minimum income or hours  a mechanism for at least an annual review of rates,  when hirer can deduct money from driver  an annual printout of driver histories and required notification of loss or suspension of licence  minimum period of notice of termination, circumstances and manner of immediate termination  a requirement for the employer or hirer not to direct the road transport driver to commit any act that will, or is likely to, result in a breach of any law.

36 Payment period for contract drivers  A hirer will be required to pay a contract driver any undisputed amounts within 30 days of the receipt of an invoice from the contractor. This overrides any less beneficial provision in a contract already in existence between the parties.

37 Safe driving plans  If a road transport driver is driving a vehicle with a gross vehicle mass of more than 4.5 tonnes, the hirer or employer of the road transport driver must prepare a written safe driving plan – in consultation with the driver. The plan must be regularly reviewed and any review must also be in consultation with the road transport driver.

38 There are a number of specified matters the safe driving plan must deal with, including:  its period of operation, driver and employer/hirer details and details of those in supply chain  all pickup and delivery locations, registrations and make and model of all vehicles used  a travel plan including anticipated time frames and when breaks are to be taken

39  vehicle inspection has been conducted, defects fixed and driver has all appropriate licences  instructions for the road transport driver to manage their fatigue, including authorising the road transport driver to have additional rest breaks  the recording of the actual starting and finishing times  instructions on what driver to do if can’t comply with safe driving plan

40 WH&S Training  Employers and hirers are required to take all reasonable measures to ensure that road transport drivers are trained in work health and safety systems relevant to the services, and must reimburse road transport drivers for relevant expenses they have incurred – provided prior approval sought which can’t be unreasonably withheld.

41 Drug and alcohol policies  Employers and hirers are required to develop and implement a drug and alcohol policy. In doing so, they must, so far as is reasonably practicable, consult with relevant road transport drivers. The policy must address specified matters; including:  prohibiting the use, consumption, possession, manufacture, sale, purchase or transfer of illegal drugs, pharmacy drugs or alcohol  a process for the driver to notify of dependency and an obligation on the employer/hirer to investigate and respond

42  the process of mandatory drug and blood alcohol testing  what drug and blood alcohol content levels constitute a breach of the policy  repercussions of a breach of the policy (ie. education, disciplinary action/termination)  Employers and hirers will be required to train road transport drivers on the policy,

43  In NSW there are several Determinations of the NSW Industrial Relations Commission setting rates and conditions relevant to contract carriers (including):  The General Contract Carriers Determination; (within Sydney Metro) and  The Interstate Carriers Contract Determination (interstate work commencing in Sydney)

44  These determinations address things such as:  Calculation of minimum rates between contract drivers and hirers  Formulas to calculate the rise and fall of cartage rates  Allowances  Minimum notice terms ( In Victoria the Owner Drivers and Forestry Contractors Act 2005 has some similar provisions applying now to owner drivers and hirers)

45  Currently these determinations exclude application to certain contracts of carriage including:  The transport of refrigerated goods, furniture removal, cash in armoured vehicles, bricks, tiles, pottery, petroleum, LPG and coal.  The TWU has made application to vary these determinations (which were implemented in 1984) with significant changes proposed.

46  The most significant change to Members is the proposal that the Determinations be applied across the board – to all contracts of carriage (other than where another determination exists)– which would include in respect to furniture removals.  Other proposed changes include:  Having one Determination which covers all of NSW and interstate with 2 tables of rates – 1 for local (within 50km of Sydney) and 1 for all else

47  Minimum engagement of 4 hours  Removal of some contract carriers obligations – such as to pay for loss or damage to goods  A requirement to provide security of engagement where practicable to do so  Reimbursement for tolls etc  Nominated ‘starting place’ and minimum notice to change

48  This matter will be proceeding to conciliation over the coming weeks and will be continuing thereafter for some time – as there is much Industry opposition  We will continue to update members as to the progress of this matter as advised to us.

49  Contact IR Assist on :  p:  e:


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