Victorian Forestry Contractors Information Booklet

Victorian Forestry Contractors Information Booklet

How to find more information

Message from the Minister for Industrial Relations, the Hon Rob Hulls MP

Rob Hulls MP

Minister for Industrial Relations

Message from the Forestry Industry Council

OVERVIEW:WHAT IS CONTAINED IN THIS INFORMATION BOOKLET?

Part1: The Owner Drivers and Forestry Contractors Act 2005 (Vic)

Part2: Small Business Resources

Part3: Regulations and Safety

PART 1THE OWNER DRIVERS AND FORESTRY CONTRACTORS ACT 2005

1.1Who Is Covered by the Act?

1.2When Does the Act Come into Effect?

1.3Some New Terms

1.4Unconscionable Conduct

1.5Contract Requirements

1.6Joint Negotiations for Forestry Contractors

1.7No Victimisation for Exercising Rights under the Act

1.8The Information Booklet and Rates and Cost Schedules

1.9Code of Practice

1.10Dispute Resolution Process

PART 2SMALL BUSINESS RESOURCES

2.1Using the Internet

2.2Accountants And Financial Advisers

2.3Business Advice Services

2.4Legal Advisers

PART 3REGULATIONS AND SAFETY

SECTION A – OVERVIEW

3.1Who’s Who in the Regulation of the Forestry Industry

3.2Laws and Regulations relevant to the Forestry Industry

3.3Emergency Procedures, Fire and Protest Management

SECTION B - HEALTH AND SAFETY: FORESTRY CONTRACTORS

3.4How to Deal with Safety Problems

3.5General Principles

3.6WorkCover Safety Publications

3.7Documenting Health and Safety Systems

3.8Working in the Forest – Health and Safety Topics

SECTION C – HAULAGE CONTRACTORS

3.9Important Safety Information

3.10Daily Vehicle Inspections

3.11Speeding and Road Rules

3.12Loading, unloading and restraining logs

3.13Licence Requirements

3.14Accreditation

3.15Rigid trucks and trailers

3.16Auxiliary brakes

3.17Mass, Dimension, Oversize and Rear Overhang Limits

3.18Truck Stops and Rest Areas

3.19Route and Planning Information

3.20Codes of Behaviour

3.21Understanding and managing fatigue

3.22Your Health and Wellbeing

Acknowledgements

APPENDIX1: OWNER DRIVERS AND FORESTRY CONTRACTORS CODE OF PRACTICE

APPENDIX 2: APPOINTMENT OF NEGOTIATING AGENT FORM

APPENDIX 3 SAMPLE RATES AND COSTS SCHEDULE

APPENDIX 4: ORGANISATIONS, CONTACTS AND WEBSITES

APPENDIX 5: VICROADS: TRANSPORT SAFETY SERVICES OFFICES

How to find more information

The best way to get more information on any of the topics covered in this information booklet is to use the Internet. Follow the steps below and you will be taken to a website with further information on the topic.

Message from the Minister for Industrial Relations, the Hon Rob Hulls MP

In 2001, the Victorian Government conducted an inquiry into harvesting and haulage in the Victorian native hardwood sector. The inquiry found low rates of return and contract insecurity that acted as a discouragement on investment in new technology.

Three years later an inquiry conducted by Industrial Relations Victoria found that there were a number of common problems between forestry contractors and owner drivers, including lack of bargaining power, limited small business skills and financial pressure. Following the report, the Victorian Government passed the Owner Drivers and Forestry Contractors Act 2005. The Act aims to assist forestry contractors to run safe and successful businesses by:

• regulating harsh and unjust business practices;
• providing this information booklet and rates and cost schedules to forestry contractors to provide information to assist them to successfully manage their businesses;
• providing low cost resolution of disputes by Victoria’s Small Business Commissioner.

The Forestry Industry Council established under the Act has a crucial role in advising the Government and in preparing this information booklet. I thank Chairperson Neil Pope and the Council members for contributing their considerable expertise, time and efforts to this important work.

I am confident that the Forestry Contractors Information Bookletwill become a valued resource for current and future forestry contractors, and will help to create a thriving forestry contractor sector.

Rob Hulls MP
Minister for Industrial Relations

Message from the Forestry Industry Council

The harvesting and haulage sector of the forestry industry is economically significant for many Victorian families and for the economies of Victorian regional communities. The Forestry Industry Council has worked closely with the Victorian Government to prepare this information booklet so that forestry contractors have a good understanding of the requirements of the Owner Drivers and Forestry Contractors Act and to provide guidance on the regulations that apply to their work. Information on how to conduct more successful businesses is available on Industrial Relations Victoria’s website at

The Forestry Industry Council welcomes your feedback on the information booklet. Let us know which parts you found useful, and what other matters you would like to see covered in future editions, by contacting Industrial Relations Victoria on 96519200.

Neil Pope
Chairperson of the Forestry Industry Council

COUNCIL MEMBERS

Garry Blackwood, Victorian Harvesting and Haulage Council

Garry Leeson, Victorian Harvesting and Haulage Council

Nicholas Murray, Victorian Association of Forest Industries

Cameron Macdonald, VicForests

Matthew Crapp, VicForests

Lisa Saxton, Department of Primary Industries

Kevin White, Australian Plantation Products and Paper Council

Jane Calvert, Construction Forestry Mining and Energy Union

Darren Rounds, Construction Forestry Mining and Energy Union

Disclaimer

The content of this Information Booklet is drawn from a range of sources and the advice of industry participants, and is provided for information and general guidance purposes only. No claim is made as to the accuracy, currency or completeness of the content of this information booklet. While the information is intended to be of general assistance, it is not intended to provide professional advice to any person or organisation.

You should make your own inquiries as to the appropriateness and suitability of the information in this information booklet for your particular circumstances. You should note that laws and regulations change from time to time. You should check the information, including verification of whether the laws or regulations referred to are current.

The Victorian Government and this agency (Department of Innovation, Industry and Regional Development) do not accept any liability to any person for the information (or the use of such information) that is provided or referred to in this information booklet. No responsibility is taken for any information or services that may appear on any of the websites referred to in the information booklet. Further, the views expressed in the information booklet or on linked websites are not necessarily endorsed by and may not reflect either the policies or practices of the Government of Victoria.

Additionally, although we have made every effort to ensure that the material provided is complete, current, reliable and free from error, we do not warrant or make any representation about the accuracy, adequacy or completeness of the information.

We welcome feedback from you about the information booklet – contact Industrial Relations Victoria on 96519200.

OVERVIEW: WHAT IS CONTAINED IN THIS INFORMATION BOOKLET?

The information booklet is divided into three parts as follows:

Part1: The Owner Drivers and Forestry Contractors Act 2005 (Vic)

Part1 provides an overview of the new Act, Code of Practice, rates and cost schedules and the new dispute resolution service offered by the Victorian Small Business Commissioner. In this Part you can also find out about what constitutes unconscionable conduct, how to conduct joint negotiations and about the Act’s new requirements for contracts and termination notice periods.

Part2: Small Business Resources

Part2 contains a brief introduction to the key small business resources.

If you want information that will help you get the best results in setting up your business, buying equipment or vehicle and negotiating contracts, please see Industrial Relations Victoria’s website at and follow the links to forestry contractors – information booklet.

Part3: Regulations and Safety

Part3 covers the safety laws and other regulations that apply to forestry contractors. In this Part you can, for example, find out about emergency procedures, fire and protest management and health and safety issues.

PART 1THE OWNER DRIVERS AND FORESTRY CONTRACTORS ACT 2005

The Owner Drivers and Forestry Contractors Act 2005 (Vic) provides important new rights for forestry contractors.

1.1Who Is Covered by the Act?

The Act applies to harvesting and haulage contractors and their hirers.

“Haulage contractor” means sole traders, non-public companies or partnerships that provide services transporting forest products. The Act only applies to haulage contractors where the owner of the business also drives one of the vehicles. All harvesting contractors (other than public companies) are covered by the Act. Forestry contractors are also referred to in the Act and the Code of Practice as “contractors”.

1.2When Does the Act Come into Effect?

The parts of the Act establishing the Forestry Industry Council, allowing the Code of Practice to be made and allowing for joint negotiations commenced on 1 February 2006. The remainder of the Act and the Code of Practice commenced operation on 1 December 2006.

1.3Some New Terms

Term / Meaning
Code of Practice / Means the Owner Drivers and Forestry Contractors Code of Practice made under Part3 of the Act. The Code is set out in Appendix 1.
Dispute resolution process / The process for resolving disputes between forestry contractors and hirers arising under or in relation to a contract, or in relation to the Act or Code is set out in Part5 of the Act.
Forestry Industry Council (FIC) / The FIC is made up of representatives of participants in the forestry industry. The FIC has a number of tasks under the Act.
Hirer / This is the business that engages the forestry contractor.
Industrial Relations Victoria (IRV) / IRV is the Government Department that is responsible for administering the Act. IRV has a website with information about the Forestry Industry Council and the Act at
Haulage contractors / Haulage contractor is defined in section 5 of the Act. In summary, “haulage contractor” means a person, company or partnership transporting forest products, where the owner of the business also operates one of those vehicles.
Harvesting contractors / Harvesting contractor is defined in section 6 of the Act. In summary, “harvesting contractor” means a person, company or partnership using motorised equipment to harvest forest products.
Rates and Costs Schedules / These schedules are prepared by the Forestry Industry Council for harvesting and for haulage and are based on the native forest and plantation sectors. The schedules set out examples of typical operating costs, and act as a guide to assist forestry contractors to prepare their own individual cost models. The schedules can be found on
Victorian Small Business Commissioner (VSBC) / The Small Business Commissioner was established to provide assistance to Victorian small businesses. The VSBCperforms the important mediation function under the Act. Further information is available at
Tribunal (or VCAT) / If a dispute cannot be resolved by mediation, the dispute can be referred to the Victorian Civil and Administrative Tribunal for resolution.

More information on the Act

You can download a copy of the Act, the Code of Practice and the Minister’s second reading speech from The website also contains background material, “frequently asked questions” and summaries of the new legislation. You can also ring the Victorian Business Line on 132215 for more information.

1.4Unconscionable Conduct

Part4 of the Act deals with “unconscionable conduct” by hirers towards contractors and by contractors towards hirers. The Act sets out the factors that VCAT may examine when deciding if conduct is unconscionable conduct.

Generally speaking, unconscionable conduct occurs where a stronger party to a transaction exploits the weaker party in a way that is unreasonable or unfair. The Macquarie Dictionary defines unconscionable as:

• unreasonably excessive;
• not in accordance with what is just and reasonable;
• not guided by conscience, unscrupulous.

Just because conduct is commercially tough does not make it unconscionable. Businesses are allowed to be rigorous and competitive in their dealings with other businesses, but must not behave unconscionably.

Any allegation of unconscionable conduct by a hirer or a contractor is dealt with the under the dispute resolution procedure in Part4 of the Act, and will first be mediated by the Small Business Commissioner. If not resolved, the dispute can be referred to the Victorian Civil and Administrative Tribunal (VCAT). VCAT may have regard to the requirements of the Code of Practice in determining whether the conduct of a hirer or a contractor constitutes unconscionable conduct. The Code sets out examples of conduct likely to be unconscionable (see section1.10 of this information booklet). However, what may amount to unconscionable conduct will depend on all the circumstances.

More information on unconscionable conduct

• Read section31 of the Act by following the link to the Act at If you feel you may have experienced unconscionable conduct, seek advice from your association, union or professional adviser.
• Telephone the Victorian Small Business Commissioner (VSBC) on 13 8722or go to

1.5Contract Requirements

Minimum period of notice of termination must be given

Forestry contractors who have been in an ongoing engagement for more than three months are entitled to a minimum period of notice of termination of their contracts (except in the case of serious and wilful misconduct). The notice period may be worked out, or paid in lieu. Section 22 sets out a formula for calculating payment in lieu of notice. Under sections 21 and 22 of the Act, the minimum period required to be given by either party to terminate the contract is:

• three months’ notice for vehicles in excess of 4.5 tonnes GVM (gross vehicle mass);
• one month’s notice for other vehicles.

If this does not suit the forestry contractor, the requirement can be waived by the forestry contractor obtaining a certificate from the Small Business Commissioner. This can be done before the forestry contractor is hired, during the engagement or at the time one of the parties wants to terminate the contract. An application form to waive the notice period is available from the Small Business Commissioner’s website.

More information on obtaining an exemption from the notice requirements

• Telephone the Victorian Small Business Commissioner (VSBC) on 13 8722or go to

Forestry contractors can still have a fixed term contract that comes to an end automatically on the expiry date.

Restrictions on deductions from income for insurance, goods or services

Sections 23 and 24 of Act state that a hirer must not require a contractor to pay money for services or goods provided by the hirer unless the:

• costs are specified in the contract (that is, they are agreed);
• costs are a direct and proper reflection of the cost of the service provided; and
• contractor has been provided with an opportunity to obtain the same or equivalent services or product from an alternative supplier.

Further, a contract must not make deductions for insurance costs unless a policy is in place and a copy of the policy has been provided to the forestry contractor. The hirer can still organise group discounts on services for forestry contractors (for example for fuel, tyres or insurance), and make deductions for these amounts, but only where the above requirements are met.

Contracts must be in writing and specify the minimum number of hours or income

Section 20 provides that on-going contracts (of more than one month) must be in writing, and must specify the minimum income or hours of work under the contract. The minimum could be zero, but the parties must be up-front and clear about what work they are guaranteeing.

Written contracts, especially for longer term arrangements, are good business practice and help reduce disputes and uncertainty. Written contracts do not have to be long, or complex and legalistic.

1.6Joint Negotiations for Forestry Contractors

Sections25 and 26 of the Act allow for forestry contractors and hirers to appoint a person or an organisation to be their negotiating agent to negotiate contracts. The agent could be another forestry contractor, a forestry contractor committee, a union, industry association or business adviser. A party appointing an agent can require the other party to negotiate only through their agent.

A group of forestry contractors may, if they choose, do any or all of the following: appoint an agent, jointly prepare a claim, jointly negotiate with their hirer or enter a single agreement.

Hirers are not obliged to offer the same terms to all forestry contractors in the group, but must deal with the appointed agent. No one can be forced to use an agent or to jointly negotiate.

Section 64 of the Act provides that this conduct is authorised conduct for the Trade Practices Act 1974 (Cth). However, breaches of contract, strikes or boycotts continue to be unlawful.

More information on appointing a negotiating agent

• The model form for forestry contractors to appoint a negotiating agent is contained in Appendix 2. You can download this form from
• Your union or industry association can also assist you.

1.7No Victimisation for Exercising Rights under the Act

Section 61 of the Act provides protection for forestry contractors who seek to exercise the new rights under the Act, including bringing a proceeding, informing someone of a contravention of the Act or participating in joint negotiations. It is also a breach of the Act for a hirer to punish a forestry contractor for raising issues of health and safety with any person, or for seeking improvements to their rates and conditions, or proposing to do so.

1.8The Information Booklet and Rates and Cost Schedules

Giving forestry contractors information

The Act has new requirements to ensure that forestry contractors have important information about their businesses and the market for their services before being locked into a contract.

A hirer who engages a forestry contractor on an ongoing basis, or for a period of 30 days or longer, or for 30 days in any three month period, must provide that forestry contractor with a copy of this information booklet and with the applicable rates and costs schedule at least three days prior to engagement. These requirements also apply to tender situations. The rates and costs schedules will be revised by the Forestry Industry Council each year, and hirers must also provide any new varied schedule to all current forestry contractors as soon as practicable after publication.

If the hirer does not comply with the above requirements, the forestry contractor can notify a dispute to the Small Business Commissioner. If the dispute is not resolved through mediation, the Victorian Civil and Administrative Tribunal has an additional power under section 45 of the Act to order payment of a fair amount for the services (section45).