New Requirements for Terminating Regulated Road Transport Contractors

Recent attention has turned to how regulated road transport contractors are treated under the Fair Work Act 2009 (Cth)—particularly regarding contract terminations. While contractors are not employees, certain protections apply specifically for contractors in the road transport industry, and road transport businesses need to understand their obligations to avoid exposure to claims.

Who is a Regulated Road Transport Contractor?

A contractor may be considered “regulated” if they provide road transport services under a contract for services and have been doing so (either under one services contract or a series of services contracts) for at least 6 months.

These persons are now specifically entitled to a fair process if their contract is ended.

What Does ‘Termination’ Mean for Contractors?

Termination occurs if:

• a person worked as a regulated road transport contractor under a services contract;
• a road transport business received services under the services contract; and
• the services contract was terminated by the road transport business or because of something the business did.

How is a Termination considered ‘Unfair’?

Termination may be considered unfair where it is:

• Harsh, unjust or unreasonable
• Without a valid reason (e.g. related to conduct or capacity)
• Lacking procedural fairness (e.g. no chance to respond)

This mirrors protections typically available to employees, but is also specifically set out in the Road Transport Industry Termination Code.

Key Takeaways for Road Transport Businesses

Road Transport Businesses should take the following steps before terminating any regulated road transport contractor:

• Clarify status: Is the individual likely to be considered “regulated” under the Act?
• Document concerns: Keep records of any performance or conduct issues.
• Communicate clearly: Provide reasons in writing and allow the contractor to respond.
• Follow a process: Treat the situation with the same care as an employee termination.
• Seek Legal Advice: Enterprise Legal’s specialist team is well positioned to advise you on any proposed termination to ensure the process is properly followed.

Disputes and Applications

A contractor who believes they’ve been unfairly terminated can apply to the Fair Work Commission within 21 days. The Commission may offer conciliation or proceed to a hearing. If unfairness is found, remedies may include:

• Reinstatement
• Compensation
• Other appropriate orders

Final Word

The key message? If you’re terminating a road transport contractor, don’t treat it like a commercial contract dispute. These workers may have rights similar to employees—and overlooking them can result in costly consequences. Consult the Road Transport Industry Termination Code and seek advice from Enterprise Legal’s specialist team.