The Road Haulage Association is backing an investigation into the price of oil
By Jamie White Head of Communications
Last year the RHA raised the issue with the Office of Fair Trading but was told there was insufficient evidence to support an investigation.
However, that decision has now changed and the European Competition Commission have announced a formal investigation is underway.
RHA2 Chief Executive, Geoff Dunning, said: Since the original fuel protests way back in 2000, we have been of the opinion that there should be far more transparency among the oil companies. Yet every time we raised the issue our concerns were dismissed out of hand.
Today s news that is tremendously encouraging; for the motorist in general, the haulage industry in particular and the UK economy as a whole.
At a time when the businesses are desperately trying to get back on their feet after several very difficult years, there finally appears to be a light at the end of the oil pricing tunnel.
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What do big banks and L.A. port trucking companies have in common? Fine print in contracts that traps victims into signing bad deals.
We ve all signed our share of contracts. Rental agreements, cell phone contracts, car loans. You don t need to be a legal scholar to understand the basic concept: Two parties enter into an agreement that lasts until a fixed date. And as frustrated as you may get with, say, your landlord, you know that at the very least what you ve signed off on can t change upon a whim. Even if you don t like the terms, contracts are fundamentally about guaranteeing stability.
We take this for granted but not everyone can. A case in point is drivers at Green Fleet Systems, a trucking company serving the Ports of Los Angeles and Long Beach.
In order to work as an independent contractor for the company, the drivers have to sign a lease contract then pay to lease the company s trucks. In exchange, they are assured that they will ultimately own the truck they are leasing. In late 2011, about halfway through what was supposed to be a multi-year lease to-own agreement, they came in to work one day and were told they needed to sign a brand-new lease. As we ve reported before2, these leases tend to be sham documents that companies force so-called independent drivers to sign much like3 the home mortgage docs that trapped homeowners into loans whose costs escalated beyond affordability. (In reality, these drivers are misclassified employees4, a topic that will be taken up again in a future edition of Frying Pan News.)
Through this arrangement, companies are illegally passing on their business costs like the costs of expensive new trucks to de facto employees, while evading other responsibilities like payroll taxes and workers compensation. To add insult to injury, these drivers have no ability to fight back because, as independent contractors, it is illegal for them to have a voice by forming a union.
While port trucking companies have been misclassifying drivers for years, Green Fleet Systems went a giant step further by unilaterally changing a contract already in effect. A side-by-side comparison of the two documents shows, unsurprisingly, that the changes in the new lease overwhelmingly favor the company, limiting drivers rights even further. It states that if the driver ever does claim to be an employee, he or she will not only defend and hold the company harmless, but also pay the company s defense costs. (Hello, First Amendment!) Another section states that any dispute regarding the lease will be dealt with by an arbitrator chosen by the company. (Hello, Seventh Amendment!)
Why did the company suddenly attempt to make an already one-sided document even more so? Most likely, Green Fleet Systems was attempting to inoculate itself from being forced by the courts or the government to comply with basic employment law.
It turns out that shortly before the drivers were required to sign these new leases, two of their coworkers had filed wage-and-hour claims with the California Labor Commissioner, the government office charged with enforcing labor laws in California. A month later, two more Green Fleet drivers had filed claims. These claims have Green Fleet scrambling for cover.
So, in the midst of preparing to defend its practices in front of the Labor Commissioner, Green Fleet changed the agreement it had with its remaining independent drivers to state that drivers only option to resolve a dispute was through an arbitration service in Orange County (not the California Labor Commissioner).
In addition to what appears to be an attempt to prohibit drivers from exercising their rights before the Labor Commissioner, Green Fleet has also joined with other trucking companies to try and prevent the Labor Commissioner s office itself from doing its job of enforcing the law. Just after the four Green Fleet drivers hearings concluded in October 2012, while the final decision was still pending, Green Fleet and nine other companies filed a lawsuit attempting to prevent the Labor Commissioner s office from investigating, processing, or proceeding to hearing on any claim from the companies drivers. It s an interesting gambit, somewhat akin to criminal gangs seeking injunctions against the LAPD.
In the end, despite Green Fleet s attempts to shield itself from California employment laws, the Labor Commissioner found that the four drivers were, in fact, employees and had been unlawfully misclassified. The final decision, released in early 2013, determined that Green Fleet owed the drivers a combined $280,000.
As for the remaining drivers at Green Fleet, it remains to be seen whether the revised leases that required drivers to sign away their rights are even worth the paper they are written on. If the recent decisions from the Labor Commissioner are any indication, probably not. Trucking companies can write whatever they want into leases, they can present those leases to drivers in a language drivers don t speak, they can refuse to give drivers copies of the leases and they can change the leases unilaterally. Ultimately, none of this will alter the facts on the ground: these drivers are employees, and companies are stealing from them. The more that companies unilaterally change their contracts mid-term, the clearer it is that they are engaging in a cover-up.
(Jessica Durrum is a researcher for the Los Angeles Alliance for a New Economy.)
FIGURES for 2012 show that freight transport in France and longer journeys by car drivers have fallen, with the struggling world economy being blamed for the drop.
There was a 4.4% fall in the tonne/km measure of products transported in France, which covers road, rail and waterways. Although road haulage still makes up 83% of the overall transport sector.
Daily passenger transport is still rising, but at a slower pace than in the past, with the number of vehicles on the national road network, including autoroutes, falling slightly.
And the figures also show that the number of new car registrations in 2012 by the general public tumbled to 1.9 million, a figure last seen in 1997.
- ^ report on road transport (www.developpement-durable.gouv.fr)
- ^ Sharpest fall in French private sector output for four years (www.thisfrenchlife.com)
This summer many of us will be hitting the road and that means sharing the road with plenty of big rigs.
Though some see these huge vehicles as intimidating, some a welcome beacon in the darkness, what you might not realize is the huge contribution this industry makes to the American economy.
The Road Haulage Association, represents 7,000 transport operators who, between them, run approximately 100,000 HGVs and provide vital services across the UK economy, has urged the Chancellor to consider several key points that are critical, both to the future of the UK road haulage industry, and to the future prosperity of the rest of the United Kingdom.
Maersk Line South Africa (Pty) Ltd, a subsidiary of the world s largest container shipping company, sees a moderate trade growth for the country in 2013 after a challenging 2012, this despite significant socio-economic challenges in the local market, including the impact of industrial action in the mining and agricultural sectors during the second half of last year, and a decline in consumer spending on the back of rising fuel, transportation, electricity and food costs.
The 2012 financial year was definitely a tale of two halves, says Jonathan Horn, Managing Director of Maersk Line South Africa. While the first half of the year was firm showing growth in demand for containers for both imports and exports the second half brought flat performance in the import sector, and a decline of 3% 4% in the country s total containerised exports.
This trade report follows on the back of the Maersk Group 2012 results, which showed an improved profit of US$461m after the losses posted in 2011, while South African operations are anticipating mid-single digit growth in both the import and export sectors in 2013.
On a macro level, intense competition fuelled by an oversupply of capacity, had a strong influence on global freight rates and thus revenues. Maersk responded to these with a classic efficiency and cost containment strategy; managing capacity carefully, reducing unit costs by 1.7% in 2012, improving volumes by 5% and increasing rates by 1.9%. This approach ensured that, while the return on invested capital for the year remained low at 2.4%, cash flow from operating activity was improved at US$1.8bn.
At home, the mining sector strikes in the autumn and winter of 2012 combined with a decline in commodity prices (chrome in particular) and a slowdown in commodity demand in the Far East had an effect on the export markets. From an imports perspective, increases in CPI largely fuelled by the well-publicised hikes in food, transportation (fuel) and energy (electricity) costs have had a direct impact on levels of disposable income and thus consumption. The weakening of the exchange rate in the second half of 2012 has also started to impact on imports due to increasing cost of imported items, although the full impact of this is likely to be felt in 2013.
Commodities make up approximately 35% of South Africa s containerised exports, says Horn, and in the third quarter of the year, mining production decreased by 13% compared to the same period in 2011. Further, exports usually improve as the rand gets cheaper, although this does take a while for the full impact to be felt, but last year it was a decline in demand for commodities that was largely responsible for pushing down containerised export levels. Positively though, containerised commodity exports have showed a strong resurgence from December .
As severe an effect as this had on the country s export revenues, positive developments on other fronts are beginning to counterbalance the negative trend. For example, China s GDP is expected to grow by 7% to 8% this year, which is likely to continue to drive demand for commodities. Supply disruptions due to industrial action in this critical sector of the South African economy can hopefully be kept to a minimum.
Horn also says that if the rand remains at around ZAR8.50 to the US Dollar, this could represent a boost for exports. Historically South African exports have tended to increase with the weakening of the Rand (typically after a short period where exporters gear up their operations to cater for demand). It could, in fact, see total containerised exports trade growth reaching into the high single digits during the course of the year.
We re less optimistic about Europe, though, with GDP decline in Q4, as well as retail sales and industrial production continuing to decline he says, but we do see encouraging signs in the US with consumer sentiment improving. The recovery in the housing market increased hiring and expectations of manufacturing production increases indicate that the economy is hopefully warming up after the financial crisis of 2008 and the deep recession that followed.
Unfortunately, while the situation looks brighter for exports, the same can t be said for imports.
The flat trend in the second half of 2012 bucked all trends, says Matthew Conroy, Maersk South Africa s Trade and Marketing Manager, as this is usually the time when retailers begin stocking up for the festive season. South Africa s import container market is driven largely by consumer demand for finished goods and, if this dips, the impact on imports is quickly felt.
While inflation remains relatively low at 5.4%, consumers nevertheless have to tighten their belts as prices of essential goods and services rise. Together with a tepid GDP growth forecast of 2.6% for 2013, this means the year is likely to be another tough one for consumers, and that demand for imports is likely to remain below par. This could, however, be offset by a certain level of re-stocking if interest rates remain low.
Horn nevertheless feels that the South African market will remain competitive on the whole. With respectable growth expected in 2013, it s a case of steady as she goes for the local container industry.