16 November 2020

What you need to know about Chain of Responsibility and HVNL

Road freight is central to the smooth-running of Australian business. However, it isn’t without risk. Find out how we can help your business meet its Chain of Responsibility obligations.

A shared responsibility

From the acquisition of raw materials through to the shipment of finished goods to customers, road freight is central to the smooth-running of Australian business. However, it isn’t without risk. Over-loaded or incorrectly loaded vehicles, driver fatigue and excessive speed can lead to major road safety incidents, injury or even death. The circumstances that lead to these events are often set in motion even before the truck hits the road. A driver exceeding speed limits or skipping rest breaks, for example, may be bound by unrealistic timeframes set by the scheduler. This concept is called Chain of Responsibility and is used in the Heavy Vehicle National Law (HVNL) to indicate the shared accountability of everyone in the supply chain.

Our commitment

As a 4PL, we are asset-light and technology enabled. Despite not having our own trucks on the road, we are committed to ensuring customer freight solutions are conducted in the safest possible manner and that the risks associated with freight transport are managed appropriately. We are compliant with all laws and regulations governing transport and logistics.

Because the Chain of Responsibility applies to everyone in the supply chain, our customers also have responsibilities. The following information is provided for our customers and other interested parties as an introduction to the concept. The information should not be used as a substitute for legal advice.

For more information tailored to your needs, please contact us.

What is the HVNL and Chain of Responsibility?

The HVNL applies to vehicles over 4.5 tonnes and is designed to protect the safety of all road users. The law covers matters relating to vehicle standards, mass dimensions and loadings, fatigue management, the Intelligent Access Program, heavy vehicle accreditation and on-road enforcement[1].

Under the law, if you are named as a party in the Chain of Responsibility and you exercise (or have the capability of exercising) control or influence over any transport task, you have a responsibility to ensure the law is complied with[2]. This means that if you consign, pack, load or receive goods as part of your business, you could be held legally liable for breaches of the law even though you have no direct role in driving or operating a heavy vehicle.

It is also important to note that a person’s responsibility is not determined by their job title or contract, but by their tasks. In addition, corporate entities, directors, partners and managers are accountable for the actions of people under their control.

What is the Chain of Responsibility?

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Penalties for non-compliance of the CoR and HVNL

Non-compliance could lead to a major road safety incident, causing injury or even death to the driver or other road users. There are also serious legal consequences of non-compliance for individuals and corporations. Breaches range in severity from minor to critical and penalties vary from warnings and improvement notices to costly court-imposed fines. The maximum penalty is $300,000 for an individual and/or five years imprisonment and $3,000,000 for a corporation.

efm’s CoR commitment

Under the HVNL and CoR, it is possible for an entity to be a party in the supply chain in more than one way. Not only is efm considered a prime contractor for the transport of freight, but we also have a shared responsibility with the consignor. We take very seriously our obligations to support the safety of customer freight solutions and have outlined the actions that support our commitment in our Chain of Responsibility Policy Statement. These actions include:

  • Provide CoR training, supervision and advice to enable employees to understand, participate in and maintain our Chain of Responsibility effectively
  • Conduct transport service provider compliance reviews
  • Take a consultative approach with vendors, vehicle owners, transport operators and other stakeholders in the supply chain
  • Provide information and awareness briefs to customers
  • Maintain a management reporting process.

Customers’ CoR compliance requirements

It is not just prime contractors like efm and vehicle operators that have obligations under Chain of Responsibility. All aspects of a customer’s business and all parties in the supply chain must be compliant. efm will not enter into a contract with a customer or any other party that could lead to a breach of the legislation. Executive officers of customer companies should:

  • Be aware of the CoR breach risks faced by your business;
  • Ensure that assessments are undertaken to identify CoR risks within your business;
  • Understand your business’ CoR activities and performance; and
  • Implement, monitor and evaluate the CoR compliance policy or policies and procedures.

It can be beneficial for companies to engage external expertise to review work practices and provide support for implementation of compliance systems. We recommend starting with a risk assessment to identify a business’ specific requirements, followed by the development of a tailored compliance solution, which is then integrated into the business’ operating practices.

For more information and assistance

As a trusted advisor, we are pleased to assist our customers in understanding and meeting their Chain of Responsibility obligations. The services we provide include a customer-focused CoR forum, site compliance review, customer obligations guide, self-assessment checklist and document templates to facilitate the implementation and reinforcement of compliance management plans.

To find out how we can help your business meet its Chain of Responsibility obligations, please contact us.

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Arrange an audit of your logistics solution

Take the next step in optimising your supply chain. We will meet with you to understand your objectives and challenges, then review your existing solution to identify where we could add value.