NZ unions and government officials are looking toward Australia’s commitment to a driver ‘Safe Rates’ system as concerns around race to the bottom tenders that result in low pay and long hours for transport workers persist 

The country’s largest driver-representing union wants the Government to introduce a Safe Rates system, saying its implementation overseas has resulted in fewer road crashes.

The system would legislate a baseline rate for driver wages, meaning when contracts were negotiated companies would need to make sure drivers received the cash they had been promised. 

First Union strategic project co-ordinator Anita Rosentreter wrote to the Transport Minister Michael Wood on Thursday urging New Zealand to adopt the model committed to in Australia, and underway for a number of years already in South Korea. 

“The Australian Safe Rates system is a powerful blueprint for reform and we encourage the New Zealand Government to explore introducing an equivalent system here.  

“Our ambitious Road to Zero target of a 40 percent reduction in road deaths by 2030 will not be met without bold action. We look forward to continuing the discussion with you in the coming months,” the letter said.  

Rosentreter said truck drivers, many of whom worked as independent contractors, were not protected under employment laws and were forced to work for less than the minimum wage. 

“That means they get paid per run, as opposed to an hourly rate. And there are also sometimes financial penalties if they miss deadlines and stuff like that so that really puts the pressure on to get the work done fast.  

“That can mean that drivers will speed or they might drive when they’re tired and at the risk of falling asleep at the wheel, or to make a trip more economical they might overload the truck.” 

She said tendering for contracts was highly competitive, which encouraged a race-to-the bottom approach. 

“And when that translates to the actual workers themselves, it’s often not realistic. So, there’s this immense pressure on them to meet these expectations that have been promised by people who aren’t even doing the work.  

“It also means that operators sacrifice wages and conditions and even safety programmes and things like that. So, they’ll cut the cost of carrying out these internal programs, because they just aren’t getting the money in from these contracts.” 

She said Safe Rates would provide financial security for drivers, meaning they would not face the pressure of meeting unrealistic deadlines, and would not be forced into unsafe behaviour.  

“We need something that is specific to transport because transport’s the most dangerous industry in New Zealand – most deaths by far.” – Anita Rosentreter, First Union.

Transporting New Zealand industry general manager Dom Kalasih said operators supported the concept in principle, but wanted a carrot, rather than stick approach if it came down to it.  

“The transport rates have to be reflective of whatever the industry costs are, and driver wages are a part of that cost.

“At that level we are supportive of it.” 

He also said without sustainable wages the driver shortages would persist, but didn’t want to see it legislated.  

“We want industry to be onboard and that’s why we disagreed with the Fair Pay Agreements – because of that blanket approach.

“Our view would be bring it in as guidance.” 

Rosentreter said legislation was better as it forced everyone on a level playing field.  

Michael Wood, who also holds the Workplace Relations and Safety portfolio, said he was open to the idea, but wanted more information. 

“I think that there are benefits in exploring baseline terms and conditions. That obviously is what fair pay agreements are fundamentally about – establishing a minimum floor to ensure that we drive out the ratbags and have some certainty about decent pay and conditions and obviously, that can improve safety in sectors like transport.  

“I have received a letter from First Union advocating for this sort of approach… I’m yet to fully consider that and receive advice on it. But certainly, it’s something I’m open minded to.” 

A Safe Rates system was in place for a short time in Australia before being repealed when a new government took power in 2016.  

“Unfortunately it wasn’t in place long enough to kind of see what the benefits might have been but they do have a version of it in New South Wales already which has been in place for some time,” Rosentreter said.  

“And it’s been really successful there. I was looking at some stats and it was something like, they estimate about 205 lives have been saved between 1989 and 2021.” 

Earlier this month the Australian Employment Minister Tony Burke committed to setting Safe Rates standards.  

Rosentreter said it would most likely take the form of an independent body to establish and enforce standards as well as resolve disputes. 

Safe Rates in South Korea were implemented in 2020. 

Research has found that since then, instances of speeding decreased by 39.1 percent and overloading fell 61.7 percent.

Given its success the system will soon be extended to cover more classes of drivers.  

Long overdue

Rosentreter said the dangers that exist within the industry due to the unregulated tendering model had gone on for too long.  

“We need something that is specific to transport because transport’s the most dangerous industry in New Zealand – most deaths by far.  

“And 70 percent of our workplace accidents involve vehicles as well so this is the riskiest work we have, and therefore extra care should be taken to ensure that pay and conditions aren’t something that are adding to the risk.” 

Last year a joint investigation by police, WorkSafe and Waka Kotahi found drivers for one of the country’s largest transport firms, Mainfreight, felt forced into falsifying their logbooks and ditched mandatory rest breaks in order to make their runs on time.

The routes have since been reviewed and Mainfreight has made changes, but Rosentreter said the problems were systemic and more needed to be done. 

She said supermarkets, large retailers and basically any large company that contracted transport requirements around the country could be opposed to the changes, which ultimately would result in the final cost of a contract being higher.  

Woolworths New Zealand Supply Chain Logistics head Graeme Doull said safety was an absolute priority for the company.  

“We work with our transport partners each and every day to ensure we’re helping to make roads safer for everyone – including drivers.

“Recently, we relaunched our transport safety rules which outline our five focus areas for reducing risk on the road and have also introduced new technology into trucks over the last couple of years to further improve safety including smart camera systems that provide active alerting if fatigue or distraction events occur, GPS speed monitoring and park brake alarms.” 

He said the company did not have a position on whether it would support a Safe Rates plan, because there are not any specifics around what it might look like in Aotearoa.  

Next month the Transport and Logistics System Group, which includes delegates from First Union, MBIE, WorkSafe, Waka Kotahi and ACC will hear from Australian Senator Tony Sheldon, who instigated the Australian Safe Rate system, as well as representatives of Australian transport operators and the Transport Workers Union. 

Emma Hatton is a business reporter based in Wellington.

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