The Impact of New Heavy Vehicle Regulations in the Road Transport Industry

by K&L Gates LLP

Is Your Organisation Compliant?

With the Heavy Vehicle National Law (HVNL) beginning in February 2014 and the Road Safety Remuneration Tribunal's first Road Safety Remuneration Order (RSRO) commencing in early May 2014, this year promises to be challenging for organisations involved in the road transport industry.

To add further uncertainty, the Federal Government is currently reviewing the Road Safety Remuneration System which may result in the repeal of the incoming RSRO. Despite this review, compliance with both the HVNL and RSRO will be a requirement for all organisations using heavy vehicles as part of their operations.

Organisations should consider the most efficient and cost effective way to achieve compliance with both the HVNL and RSRO by ensuring that these systems are flexible enough to sustain the potential repeal of the RSRO.

The Heavy Vehicle National Law

Following a series of administrative delays, the HVNL commenced on 10 February 2014 in Queensland, New South Wales, Victoria and Tasmania. It will be adopted in the Northern Territory and the Australian Capital Territory at a later date. The HVNL requires organisations which transport goods or have goods transported using 4.5 tonne or heavier vehicles to have a HVNL compliance system in place, particularly those companies in the manufacturing, retailing and construction industries.

The HVNL also imposes obligations on all participants in the logistics supply chain in these industries, including consignors, consignees, operators, employers and prime contractors.

Compliance with these laws requires each duty holder to demonstrate it has taken 'reasonable steps' to prevent breaches of the HVNL and its regulations. The HVNL also imposes legal liability for breaches on Executive Officers of such organisations.

The HVNL represents a harmonised system of regulation for heavy vehicles across Australia and saw the creation of the Heavy Vehicle National Regulator (Regulator) on 21 January 2013. The Regulator is responsible for the management of the National Heavy Vehicle Accreditation Scheme (NHVAS) and Performance-Based Standards (PBS) design and vehicle approvals.

Following the commencement of the HVNL, the Regulator also became responsible for administering all ‘chain of responsibility’ obligations in applicable HVNL jurisdictions relating to:

  • vehicle standards and maintenance
  • speed limits
  • mass, dimension and load requirements
  • fatigue management requirements.

The National Transport Commission (NTC) recently issued a review paper (Paper) titled Chain of Responsibility Review Assessment of Options Paper February 2014. This is part of the ongoing review of the chain of responsibility provisions in the HVNL. The public comment period for submissions closed on 14 March 2014.

The Paper sets out a number of options for the adoption of components of the model Work Health and Safety (WHS) legislation. These include:

  • adoption of the standard of 'reasonably practicable' 
  • broadening the definition of 'responsible parties' 
  • an increase in enforcement measures, such as prohibition notices 
  • increases in penalty levels consistent with those in the WHS legislation.

It remains to be seen whether all or some of these options are adopted and the implications for those that form part of the chain of responsibility.

Road Safety Remuneration Order

Following an extensive consultation and submission process, the Road Safety Remuneration Tribunal made its first RSRO on 17 December 2013. The RSRO will run for a period of four years from 1 May 2014 and will impose numerous obligations on participants in the supermarket retail and long distance supply chains.

The RSRO requires:

  • contractor drivers to be paid for their services within 30 days of a hirer's receipt of a valid received invoice 
  • road transport drivers to have written contracts, with these contracts to be made available in electronic format 
  • contracts between supply chain participants to be compliant with the RSRO 
  • safe driving plans to be prepared for long distance operations in a heavy vehicle (any vehicle weighing over 4.5 tonnes) 
  • training in work health and safety to be provided to road transport drivers 
  • employers and hirers to implement RSRO compliant drug and alcohol policies 
  • compliance with the RSRO's dispute resolution procedure
  • road transport drivers to be protected from adverse conduct in specific circumstances.

The issue of rates of payment for road transport drivers is the subject of additional proceedings in the Road Safety Remuneration Tribunal, with these proceedings also investigating forms of payment and what constitutes 'work' for the purposes of receiving payment.

The Pending Review

The RSRO has been criticised by various stakeholders within the road transport industry due to its perceived overlap with the HVNL, work health and safety laws and the regulatory burden it will place on the industry. As a result of these perceived issues, the Federal Government announced late last year that it would conduct a review of the Road Safety Remuneration System. The review is designed to assess the operation of the Road Safety Remuneration Act 2012 (Cth) and the Road Safety Remuneration Tribunal and provide advice on whether the system effectively addresses safety concerns in the road transport industry.

The future of the Road Safety Remuneration System will likely depend on the outcome of this review and the composition of the Federal Senate following 1 July 2014.

What Does This Mean for Your Organisation?

The obligations imposed under the HVNL and RSRO are onerous and the full impact of these changes are currently unclear.

While all affected organisations should have in place HVNL compliant systems, the potential repeal of the RSRO means that a substantial question remains: does your organisation also need to ensure compliance with the RSRO even if it may be repealed? The simple answer is 'yes'.

Compliance with the RSRO is mandatory and all organisations involved with the road transport industry should ensure that steps are taken to satisfy its obligations under both the HVNL and RSRO by ensuring that:

  • directors and senior managers are made aware of the Executive Officer liability provisions within the HVNL
  • all relevant employees (including road transport drivers) are aware of the steps that must be taken to achieve compliance with both the HVNL and RSRO
  • contractual arrangements, safety and operating systems, training programs and internal policies (eg drug and alcohol policies, safe driving plans and driver contracts) are updated to reflect the obligations imposed by the RSRO.

While the RSRO arguably represents a 'best practice' approach to management of road transport drivers, it does impose quite onerous and potentially costly obligations on organisations that are involved with the road transport industry.

Given the impending Federal Government review and uncertainty surrounding the future of the RSRO, organisations may wish to proceed with some caution when taking steps to overhaul their systems and practices to allow for some flexibility should the RSRO be later repealed. When reviewing current systems and procedures organisations may wish to:

  • ensure that any long term contracts address the possibility that the RSRO will be repealed and provide scope for the organisation to vary contractual relationships in consequence of an anticipated regulatory change
  • give consideration to whether the organisation's current systems and procedures may be later amended to be solely HVNL compliant if required.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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K&L Gates LLP

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