Sims Ordered To Pay Owner Drivers $10,814

• General News
• 27th June 2012

Firm had to give Alan reasonable notice to terminate contract

In a case before the Road Freight Tribunal in April it was confirmed that where an owner-driver contract is of indefinite duration then the hirer is required to give reasonable notice to the owner-driver to terminate the contract.

In that case, the TWU represented owner-driver Alan Hajje in a dispute with Sims Metals.

Alan had been providing services to Sims as an owner-driver for nearly four and a half years, and had purchased a new truck to undertake the work.

There was no no written agreement between Alan and Sims.

Unfortunately, Alan had some health problems and he was given "leave" by Sims for the period he needed to get treatment and to recover so he could return to work.

After several months away Alan overcame his health problems and was able to return to work.

However, Sims told him they had no work for him.

That is, Sims terminated Alan's contract. But Sim's did not give Alan any notice of termination of his contract.

The TWU sought damages against Sim's for breach of contract.

I argued Alan's case with assistance from the TWU Organiser, Tim Dawson and Industrial Officer Jessica Phillips.

Sims argued that the arrangement was between Sims and Alan was that Alan provided services to the company on an "as required" basis, and therefore, there was no "ongoing" contract.

This was because the work the drivers did on a particular day was allocated to them on the previous afternoon, and there was no guarantee of ongoing work.

This was despite Alan having undertaken work for Sims on just about every working day for nearly four and a half years.

Not surprisingly, the Tribunal found thatthe contract between Alan and Sims was an ongoing contract.

Accordingly, the Tribunal held that there was an implied term in the contract that Sims had to give Alan reasonable notice to terminate the contract.

In this case the period of reasonable notice was held to be two months.

Accordingly, as Sims had not given Alan any notice, the Tribunal made an order that sims pay Alan damages for breach of contract totalling $10,814.00, including interest.

This case shows that owner-drivers who are doing work for the same hirer on an ongoing basis do have some rights, even if the contract is not in writing.

In particular, where the hirer wants to end a contract which is of an indefinite duration the hirer must give an owner-driver "reasonable notice".

What is "reasonable notice" will depend on the circumstances of each case. However, I consider that in most cases where the owner-driver has been doing work for the hirer for several years the period of reasonable notice will be at least two months.

If a hirer terminates an owner-drivers contract without giving the driver any notice then the owner-driver may be able to claim damages.

The damages will be the amount that the driver would have earned during the period of reasonable notice, less expenses such as fuel, oil, repairs and maintenance, and tyres.

In such a case the driver should contact the TWU as soon as possible after the termination of the contract to seek advice about the matter.

It always pays to be a TWU member