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Understanding Transport Chain of Responsibility
Chain of Responsibility (CoR) is a concept that places legal obligations on parties in the transport supply chain. It was devised in the early 2000s to impart accountability, driver fatigue management, speed, overloading and load restraint issues. There were significant transport industry issues at the time for all parties associated with the transport supply chain. In 2005, the Chain of Responsibility legislation was developed as part of the National Road Transport Reform (Compliance and Enforcement) Act 2003.
In 2014, the Heavy Vehicle National Law (HVNL) was introduced as a single set of laws for heavy vehicles on the principle that “anyone who has influence over the transport activity is responsible for safety on the road”. The legislation targets operators who may seek to gain unfair competitive advantage by breaking the law, and imposes a positive duty on all who have responsibility for the parts of the supply chain where actions, inaction or demands increase risk.
New Primary Duty laws in 2018
On 1 October 2018, the Heavy Vehicle National Law (HVNL) was amended to provide that every party in the heavy vehicle transport supply chain has a duty to ensure the safety of their transport activities, whatever their role in the supply chain. In practical terms, this primary duty represents an obligation to eliminate or minimise potential harm or loss (risk) by doing all that is reasonably practicable to ensure safety, which is consistent with the requirement of the National WHS regulations.
The WHS legislation defines “reasonably practicable”
Subdivision 2: What is reasonably practicable
18 What is reasonably practicable in ensuring health and safety
In this Act, reasonably practicable, in relation to a duty to ensure health and safety, means that which is, or was at a particular time, reasonably able to be done in relation to ensuring health and safety, taking into account and weighing up all relevant matters including:
(a) the likelihood of the hazard or the risk concerned occurring; and
(b) the degree of harm that might result from the hazard or the risk; and
(c) what the person concerned knows, or ought reasonably to know, about:
(d) the hazard or the risk; and
i. ways of eliminating or minimising the risk; and
ii. the availability and suitability of ways to eliminate or minimise the risk; and
(e) after assessing the extent of the risk and the available ways of eliminating or minimising the risk, the cost associated with available ways of eliminating or minimising the risk, including whether the cost is grossly disproportionate to the risk.
As a party in the supply chain, the best way to minimise risk insofar as is reasonably practicable is to have safety management systems and controls in place, such as sound business practices, training, procedures and review processes that:
- Identify, assess, evaluate, and control risk
- Manage compliance with speed, fatigue, mass, dimension, loading and vehicle standards (including maintenance) requirements through identified best practice
- Involve regular reporting, including to executive officers
- Document or record actions taken to manage safety
Common CoR breaches resulting in potential uncontrolled risk scenarios
The aim of CoR is to ensure that everyone in the supply chain shares responsibility for ensuring that breaches of the HVNL do not occur and that it is not solely the responsibility of the person(s) who loads the vehicle. A party may be named and have multiple duties, for example, as the employer, operator and consignor of goods.
The CoR changes make this a ‘shared’ responsibility, between the consignor and the person tasked to load & secure the items.
For example, a consignor has certain responsibilities under the NVHL regulations as they are a party to the supply chain, particularly with influence over goods logistics.
Certain responsibilities include;
- Fatigue laws
Common errors for either party, the driver and the consignor:
- Applying business practices or demands that cause a driver to breach fatigue management requirements or speed limits
- Failing to weigh, measure or secure loads, including poor weight distribution over the axles
- Setting schedules with unrealistic time frames
- Causing unreasonable delays in loading and unloading, impacting on driver hours/delivery times
- Packing goods incorrectly
- Entering terms in contracts and arrangements that encourage, reward or give incentives to the driver or other parties in the CoR to breach the law
The outcome of these errors can result in weight shifting leading to roll over, loss of load or loss of vehicle control.
Penalties for Breaches of National Heavy Vehicle Laws
Under the CoR, all parties with control or influence over a transport activity are responsible for complying with and for breaches of the NHVL. Significant penalties apply under the current CoR for breaches. These include but are not limited to fines, prosecution and loss of licence.
Fine amounts are updated annually and can be found on the NHVL website.
Fines for individuals currently have 4 levels:
- Level 1 Minor Risk Breach e.g. Driving a heavy vehicle in breach of a vehicle standards condition.
- Level 2 Substantial Risk Breach e.g. Driving a heavy vehicle in contravention of mass/dimension conditions
- Level 3 Severe Risk Breach e.g. Tampering with equipment provided for safety reasons, such as speed limiter.
- Level 4 Critical Risk Breach. e.g. Intentionally resting for less than the minimum time, to receive financial benefit
Corporate fines are five times the amount of individual fines.
Fines can be extended to an amount 3 times the commercial benefit received by committing the offence.
From 1 October 2018, new Primary Duty Penalties are in place across three categories with varying degrees of severity. Worse case for a Category 1 Recklessness breaches may include up to five years imprisonment, $300,000 for individuals and $3,000,000 for corporations.
Five Focus Areas of the amended CoR
There are five primary focus areas in the amended chain of responsibilities regulations. These are in the areas of:
- Employers and customers will be held accountable for dangerous work schedules and long truck queues
- Maximum work hours and minimum rest hours are defined by legislation
- Schedules and rosters must be developed with this in mind
- Drivers must be fit for work
- Workplace conditions must not contribute to fatigue
- Delays in loading, unloading and truck queuing that contribute to fatigue must be addressed
- A load must not be placed in the way that makes the vehicle unstable or unsafe
- The load must be secured so it is unlikely to fall or be dislodged from the vehicle
- An appropriate method must be used to restrain the load
- Loads must meet the standards recommended in the National Transport Commission Load Restraint Guide.
- Have regard to sign-posted road speed limits
- May be defined by legislation
- May apply to a particular vehicle
- May prohibit travel between two places in less than a specified time
- Speeds must be monitored and enforced. Examples of control include;
- systems to ensure the terms of the consignment, contract and agreements will not cause or encourage the driver to exceed the speed limit;
- Implementing and maintaining system to ensure demands are not made of the driver that may result in speed limit exceedance; and
- Systems to ensure the driver’s schedule will not cause the drivers to exceed the speed limit.
Mass and dimension
- Vehicles must not exceed the mass AND dimension limits specified in the Heavy Vehicle (Mass, Dimension and Loading) National Regulation unless exempted. These apply to single and combination vehicles.
- There are standards for construction, performance and size limits.
- There are standards for oversized or over-mass vehicles and combinations that are exempted from normal limits by way of an issued permit or notice of exemption.
- Vehicles must be well-maintained and roadworthy
- Vehicles must be fitted with safety equipment
- Unsafe vehicles must be removed from services
- Unsafe vehicles must be repaired
- Problems with vehicles must be reported to the owner by whoever notices them
- Tampering with safety equipment must not occur
- Drivers have an obligation NOT to drive an unsafe vehicle
What should I do?
Step 1 – Review your existing system’s compliance with the CoR laws
Determine if you are a party to the CoR. What role(s) do you hold in Supply Chain?
- Consignee – orders and/or receives the goods
- Consignor – dispatches goods for delivery
- Scheduler – has influence or control over the delivery time
- Packer – prepares the goods for movement
- Loader – loads the goods onto a vehicle
- Loading Manager – supervises the loading process
- Driver – transports the load by road
- Unloader – unloads the goods at the destination
- Employer – person or company who employs someone else to drive a regulated heavy vehicle
- Prime Contractor – engages someone else to drive under a contractor for services (subcontractor)
- Operator – controls or directs operations of a vehicle/fleet
- Owner-sole or joint owner of a vehicle (e.g. Owner-driver)
WHAT MUST THESE PERSONS DO?
- Eliminate or minimise public risks
- Not cause or encourage a driver of a heavy vehicle or another person to contravene the law
A person must not enter into contracts or arrangements that encourage, reward or give incentives to the driver or other parties in the supply chain to breach the law.
Note on Executives of Legal Entities:
Executives must exercise due diligence to ensure the safety of the legal entity’s transport activities. In this case, due diligence means gaining and maintaining knowledge about safe conduct of the entity’s transport activities. Executives must understand the hazards and risks associated with their transport activities and have appropriate resources to implement processes to eliminate or minimise those hazards and risks. They must respond to information received about hazards and risks in a timely manner and must verify that suitable resources and processes are provided, used and implemented.
Action: Use the NHVR gap analysis tool for CoR and also Governance, available as a free download from the NHVR website. Apply this to your business and your role(s) in the Supply Chain to determine any areas of non-compliance with the NHVL. An online form can be found at here.
Step 2 – Make adjustments to your system to correct any gaps you identify
The gap analysis tool will help you identify where your existing management systems may fall short of complying with the new CoR. Implementing improvement where controls are inadequate assists with making the roads a safer place for all users and minimises potential for organisation to receive penalties, prosecutions and sanctions.
Action: Determine the reasonable steps you need to take to control the risks identified in the gap analysis tool.
- Use of loading diagrams
- A driver communications process about late loading/unloading, so they can manage their work/rest times
- Reference to the NTC mass and dimension guidelines
- Audits and reviews
- Providing accurate container weight information
- Agreeing on realistic delivery timelines
- Checking subcontractor systems for preventing CoR breaches.
The NHVR, as well as its gap analysis tool, offers support and assistance including checklists, templates and tools, Quick Guides and worked examples. These are particularly valuable for smaller businesses, owner-drivers and small fleet operators who have fewer resources and perhaps less experience with developing management systems. Larger businesses will still benefit from accessing the guidance material and familiarising themselves with what is required to comply with the new CoR.
Your business may need to make some changes and some of these may involve investing in improvements that mitigate risk. Developing a simple management system if you have nothing in place should be relatively easy and cheap with the tools provided by the NHVR. But there will often be investments in technology, hardware and measuring tools that are desirable and these may include (where required):
- Scales on loading equipment
- Safety equipment such as speed limiters
- Driver rest facilities
- Pedestrian segregation hardware
- Engineered truck modifications
- Load restraint hardware and equipment
- Intelligent Speed Assist
- Electronic In-Vehicle Monitoring Systems
Step 3 – Implement your changes and communicate them to all parties
It is important that you communicate the upcoming CoR changes to your employees and subcontractors. They should be informed about the scheduled amendment and what this will mean for them. Some businesses will also need to provide information to their customers about any changes they will be implementing that may impact a customer’s service expectations. Consignees must understand that they are also considered as part of the Supply Chain and have a positive duty to comply with the CoR, eliminate or minimise risk to the extent of their ability and not to cause a person to contravene the law.
Action: Brief your management team, employees and contractors, so all are aware of the changes you have made to your management system. Customers also need to be made aware, so include them in your communications.
Step 4 – Verification
Prepare and implement a management plan to verify and ensure controls and system effectiveness.
Exceptions to introduction of the CoR
While the National Heavy Vehicle Laws are intended to apply nationally, the NT and WA are not adopting the laws at this time. Road transport in the NT and WA will remain within existing State and Territory laws. In WA this is the Road Traffic (Vehicles) Act 2012 and in the NT this is the Work Health and Safety (Nationally Uniform Legislation) Act 2012. In WA, the State legislation applies to both heavy and light vehicle transport. Speed and fatigue in WA are addressed under WHS legislation.
If your business is located in the NT or WA and you travel to states covered under the new CoR legislation, you must be aware that some HVNL requirements WILL apply on trips to these States. From 1 October 2018, your drivers will need to commence a National Work Diary at the beginning of the trip and will be restricted to a 12 hour driving maximum.
- National Heavy Vehicle Regulator
- Heavy Vehicle National Law and Regulations
- HVNL Major Legislative Changes Commencing 1 October 2018
- National Transport Commission Australia
- CoR Australia TLIF0002 Administer Chain of Responsibility Policies and Procedures
- International Risk Management Standard IS0 31000
- NHVR Introduction to Risk Management – A Heavy Vehicle Industry Guide (Sep 2017)
- Nationally Harmonised Work Health and Safety (WH&S) laws and regulations
The information in this material is not intended to provide, and should not be relied upon, for legal or professional advice and is subject to change.
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