Thirty-day payment terms industry push


Clark warns of strain on industry from unfair terms

Thirty-day payment terms industry push
30-day payment terms are a priority for NatRoad

 

The National Road Transport Association (NatRoad) has re-iterated its calls for a mandated 30-day payment terms, noting that too many contracts for road transport services contain unfair payment terms.

The association has seen an increasing tendency for payment periods to extend to 90 days, CEO Warren Clark says.

"But 30-day payment terms are a must for the road transport industry, which is characterised by tight margins, and intense competition," he adds.

"The road safety remuneration system that NatRoad fiercely opposed had one highly beneficial element: the mandating of 30-day payment terms.

"Having this provision returned to the law would significantly improve the viability of small trucking businesses."


These calls echo NatRoad's support of ASBFEO's payment probe in November. Read more here


Clark advises businesses to check their contracts so provisions that permit the client to withhold payment of disputed invoices are not part of the agreement to provide transport services.

"We have analysed contracts for members where a trap is set for not meeting timing or document submission deadlines," Clark says.

"Penalties for not meeting KPIs under the guise of so-called liquidated damages should be resisted in contract terms, particularly where the time slot allocated for delivery is not reasonable.

"The better members define and adhere to payment terms and reject penalties for not meeting KPIs the more likely members are to be paid promptly and to avoid disputes.

"NatRoad considers that a contractual term requiring payment beyond 30 days has all of the hallmarks of an unfair contract term."

The peak body says it has asked the federal government to make provisions in small businesses contracts that require payment beyond that period unfair under the legislation.

"In the context of an upcoming election, we are urging both political parties to stop the unfairness associated with payment terms and to help operators in the road transport industry make a decent living rather than being mere price-takers," Clark says.

 

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