Small business in the transport sector under threat from union/big business cartels
The Australian Small Business and Family Enterprise Ombudsman Kate Carnell (the ASBFEO) has released findings on the effect on Australian small businesses of the Road Safety Remuneration Tribunal’s Contractor Driver Minimum Payments Road Safety Remuneration Order 2016 - commonly referred to as the RSRT. See report HERE
Ms Carnell’s report was damning of the process and the outcomes, malady which had a destructive impact on too many self employed people and their families. The findings are listed at the end of this article and one key and telling finding is:
It is with great regret and sympathy that it was reported to the Inquiry that some owner drivers found they were unable to cope with further hardship caused by the Payments Order and took their own lives.
This inquiry highlighted the amateurish and dangerous behaviour of a tribunal responsible for overseeing a process that was supposed to make our roads safer for all users. How could these tribunal commissioners get their actions so wrong that they created situations where owner drivers were forced off the road, medical where some individuals had their futures so challenged, their capacity to provide for their families so removed, that they lost their own mental health? Why did the commissioners, the unions, the legislators and the politicians not see that what they created was a disgraceful process that could not create safer roads? It seems that the process had one underpinning yet hidden aim - the creation of dominant union friendly transport companies. A majority of politicians in the end saw the problem and dumped the tribunal, but too much damage was created and some cannot be undone.
In summary there was a total lack of care for the health and the rights of the self-employed involved in the process.
This isn’t uncommon when dominant organisations or ideologues try to achieve a questionable outcome by seizing the moral high ground and claiming only they care for some particular cause or need. In this case the cause was road safety. The union basically claimed that road safety could be achieved by getting rid of owner drivers and leaving the roads run by big business and their employed drivers who are union members.
There was no data to support their claim, indeed the available information shows the opposite was true. If any reasonable person thinks about the issue for a few minutes they will realise it makes more sense that a person who owns certain property will be more careful with that property. While owner drivers will have a better safety record it does not mean that employed drivers are a problem, I would think those who drive for small transport companies will also be safer as the owner has a much closer relationship with their drivers. In big companies it is all about shareholders, profit, efficiency, unions and contracts. For too many dominant modern unions it is about membership not safety, wages or the economy.
My understanding is that the Transport Workers Union (TWU) has data showing owner drivers have a better safety record but have ignored this as it does not support their aim for more union members. The real facts as shown by the Ombudsman’s report is that Australia has an enviable record in road safety. We must always continue to seek better safety on our roads but using the emotion around road safety to force owner drivers from the road will make our roads less safe.
Sadly, this is another example of vested interests who dwell on the moral high ground and ignore their due diligence or plainly make up data to support their cause.
This inquiry also shows one developing problem for the Australian economy and that is the growth of union/business cartels. These cartels, these monopolistic partnerships, can only be removed or at least addressed by legislation and regulation.
The cartels exist in several sectors all of which are important and worth fighting for. Besides transport his includes; superannuation, retail and construction.
In the superannuation sector the industry superannuation funds are basically partnerships between big unions and big business associations.
In retail the sector is dominated by a cartel of Wesfarmers, Woolworths and the retail union, the SDA (Shop Distributors and Allied Employees Assoc) and between them they have manipulated the workplace relations system to increase market share for the retailers and membership for the union. This has been at the expense of the wages of weekend workers and has created a need for the Fair Work Commission to intervene.
The construction sector is all about the CFMEU and three or four foreign companies.
This is why we need the ASBFEO. Because an effective small business sector is good for the economy and for the health of our community. Thus it is imperative that the self-employed have someone inside the bureaucracy fighting the good fight. No other ombudsman or regulator can focus on small business as people and their impact on the economy. It seems the ASBFEO maybe the only means to stop big unions and big businesses forming cartels for their benefit but not to the benefit of the community.
Large unions and the biggest businesses have, until recent days, controlled workplace relations, competition policy and indeed whole political parties for their benefit not for the benefit of Australia. Australia’s long lasting resources boom has hidden the negative impact of this behaviour but now that we need innovation and we need those who can quickly deal with change and indeed create necessary change we also need this special ombudsman to make sure the way is clear.
I note that the TWU has challenged the ASBFEO report by pointing out that Kate Carnell is a past Liberal Party politician of some note. It is typical of the ruling class to ignore messages they cannot refute and instead attack the messenger. They should respond to the report not the personalities around the report. Also have no doubt that both main political parties will have some (laissez-faire economists) who will want the ASBFEO position abolished or perhaps one of their own appointed to the role, someone benign in behaviour and obedient to the few dominant players. The major parties must resist that influence if we are to have less RSRT fiasco’s and more innovation.
Let’s focus on innovation and a transparent business community not a future controlled by big businesses and their personal unions. The RSRT is a failed process and a lesson to the policy makers and legislators about managing influence and focusing on health and fairness. Then innovation will flow.
Key findings of the ASBFEO RSRT inquiry
The Payments Order resulted in owner drivers in the long distance and supermarket
distribution sectors being made uncompetitive. This exacerbated the competitive
pressures already faced by owner drivers.
There was significant uncertainty and anxiety for owner drivers (and others involved in
the industry) about the application and impact of the Payments Order given its
complexity and short implementation time.
Uncertainty for owner drivers continues beyond abolition of the Tribunal and the Payments Order.
It is with great regret and sympathy that it was reported to the Inquiry that some
owner drivers found they were unable to cope with further hardship caused by the Payments
Order and took their own lives.
The effect of the Payments Order on individual owner drivers and small businesses was
significant, with financial hardship and stress placed on personal relationships and
mental and physical health.
The Payments Order was discriminatory in its application to owner drivers and small
family businesses and this discrimination was not based on a sound and sufficient
The Tribunal’s processes were adversarial and overly legalistic with an absence of
flexibility extended to owner drivers to accommodate their lack of legal representation
and limited understanding of tribunal and court-like processes.
Owner drivers who appeared before the Tribunal were not treated with due respect and
felt that the Tribunal lacked independence and impartiality.
Tribunals are suited to resolving disputes; they are not appropriate vehicles for
developing complex industry-wide regulation that intervenes in market forces.
Although the issue of compensation was raised during consultation, there are
significant difficulties in compensating small business impacted by the Payments Order, particularly approaches to eligibility and quantum would be extremely difficult to
Fatigue management laws under the National Heavy Vehicle Law are inflexible and as a
result may lead to perverse situations, such as permitting a person to drive when they
Safety in the transport industry should not be addressed by legislating rates of pay.
It is costly and onerous for heavy vehicle drivers who unload/load to have to complete
site specific induction at every site for work health and safety purposes. Induction can
vary between 15 minutes and 4 hours and some drivers can have as many as 40