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Owner drivers and forestry contractors have a set of rights that need to be catered to. So, if you employ their services, you need to ensure the drivers have all the information they need before proceeding with a job.
A recent compliance check conducted by the Wage Inspectorate Victoria found that in an overwhelming number of cases, most drivers were not receiving the notice and documentation they were entitled to. Thus, a push to make these laws set out in the Owner Drivers and Forestry Contractor Act 2005 more visible ensued in order to promote greater compliance.
In this article, we’ll discuss the duties under the law of both drivers as well as freight brokers and hirers. We’ll look at:
- What makes an owner driver
- The difference between a contractor and an employee
- Legal obligations under owner driver laws
- Contract requirements
- Record keeping obligations
What Is An Owner Driver?
The Owner Drivers and Forestry Contractor Act 2005 defines an owner driver as individuals who meet the following requirements:
- They must run a business transporting goods
- They must have three vehicles
- One of those vehicles must be operated by the owner driver
If you meet these requirements, then you are likely an owner driver. Similarly, if the above requirements apply to you in the context of garnering and moving forest materials, then it’s likely you are a forestry contractor.
The rules and regulations discussed in the article apply to both owner drivers and forestry contractors (we’ll use the term owner drivers from here on!).
How Do I Know If I’m A Contractor?
Owner drivers are usually hired as contractors. The key difference between an employee and a contractor is that an employee is an internal member of an organisation, whereas a contractor is hired externally.
An employee usually is hired on a permanent basis, however, a contractor will only be there for a set period of time specified in their Contractor Agreement. For example, a business may hire a contractor until the completion of a certain project. Contractors need to manage their own taxes, which is different to employees.
Despite this pretty striking contrast, it can be confusing to know whether you are a contractor or employee on a day to day basis, as the roles of an internal employee and contractor can look similar.
If you are confused about whether you are a contractor or an employee, check out our article that details the various ways employees and contractors are distinct from one another.
What Are The Forestry Victoria Laws?
Recent compliance checks conducted over the last year found that hirers and freight brokers were not complying with their legal obligations towards owner drivers. As a result, a campaign was formed to push for more awareness of the existing laws listed in the Owner Drivers and Forestry Contractor Act 2005.
The regulations in question focused around job hires that last 30 days or more in a 3 month period. According to the laws, it is the responsibility of hirers and freight brokers to provide the following documents to drivers at least three days prior to their employment:
- An information booklet
- A schedule of rates
- A written contract
These documents are important as they help drivers understand their rights and responsibilities prior to engaging in work. This can aid in equipping drivers to better protect themselves as they conduct their business.
Failure to comply with these laws can result in fines, so make sure you’re well aware of what you need to be doing.
It is crucial to understand that more than half the owner drivers in Victoria do not speak English at home. This statistic prompted the need for translated versions of the Victorian government’s website. If you are a hirer looking to engage a driver, look to ensure the information provided is in a language the driver is comfortable speaking and understanding.
If you are a driver, you do have options to view the documentation in or have your rights explained in a language other than English.
Taking the time to understand that all parties involved are aware of their rights can facilitate a better working relationship and avoid any potential disputes down the line.
Hirers And Freight Brokers: What You Need To Do
As we discussed, hirers and freight brokers need to provide all the relevant documentation to the owner drivers whose services they will be utilising. Remember, this information needs to be provided at least three days prior to work commencing if the relationship is for a minimum of 30 days over 3 months.
Information Booklet
The Owner Drivers Information Booklet is a comprehensive resource detailing a number of things every driver may need to know to be successful and safe in the industry. The booklet cover matters such as:
- Basic business information
- Rights of drivers, including hours of operation and timely payments
- Tips on staying safe on the road after many hours of driving
- Managing costs
- Tax information
It really is a useful resource, so make sure you get these out to your drivers!
Rates And Cost Schedules
The rates and cost schedules can be found online. There is no one schedule – it will vary depending on the size of the vehicle. The different schedules can be viewed through this webpage.
It’s important to keep in mind that the schedule was created due to the quick increase in fuel costs. It is subject to be reviewed again for changes. Therefore, it’s good to keep an eye on this in case there is an alteration that will impact you.
Do I Need A Written Contract?
Yes, a written contract is essential to comply with the requirements of hiring owner drivers. In accordance with Victorian laws, all contracts need to be in writing.
The contract should include all the important matters relevant to the working relationship. Namely:
- Hours of work
- Payment rates and methods
- Termination clauses
- Dispute resolution
- Possibility of contract extension
- Conduct expectations
Getting the contract in writing is important to be in compliance with the law. Whether this is in physical or electronic form doesn’t matter, but make sure all signees have a copy with them.
What If I Want To End My Contract?
If you want to end your contract, there should be a termination clause that details what happens if one party wishes to terminate. You can also end a contract using a Deed Of Termination.
As this is a contractor agreement, the employment is set to end at a particular date anyways. If you are thinking of ending the contract prior to its end date, then there are a number of factors to consider.
Think about whether there will be any damages to pay or if there is a legitimate reason for wanting to end the agreement (such as one party not fulfilling their obligations). Ending a contract early should be assessed on a case by case basis.
If you do want to get out of an agreement early, contact our legal team today for some expert advice.
What Records Should I Keep?
Records need to be kept in order to have evidence that all obligations are being met. All three of the documents mentioned above should be kept.
If you are a driver, keep a copy of the booklet, contract and schedule. For freight brokers and hirers, it is your legal responsibility to keep a record of all those documents and any other relevant transactions with the drivers.
This includes evidence that you had provided drivers with the correct documentation, any information relating to contact details, payments and dates as well as copies of all contracts.
Click here for a more comprehensive list on what records need to be kept.
Key Takeaways
It doesn’t matter if you are an owner driver or the organisation hiring one. It’s important to be aware of the obligations under the Owner Drivers and Forestry Contractor Act 2005 to promote greater compliance.
Ultimately, however, it’s the responsibility of freight brokers and hirers to ensure they are keeping records and providing all the right documentation to drivers. To summarise what we’ve discussed:
- If you run a business transporting good that has three vehicles (one of which you operate) then you are an owner driver
- Owner drivers are hired as contractors
- Upon every new job that last more than 30 days over 3 months, owner drivers should receive a written contract, information booklet and schedule
- Contracts should always be in writing
- Records of all dates, contracts, transactions, contact information and more need to be kept
If you would like a consultation regarding owner driver legal obligations, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.
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