Transport unions seek to hold major retailers accountable for sham contracting

The Transport Workers’ Union (TWU) and the Australian Road Transport Industrial Organisation (ARTIO) are lodging a landmark application with the Fair Work Commission to hold major transport clients accountable for illegal sham contracting within their supply chains. The move seeks to force large supermarkets and retail giants to implement enforceable auditing, record-keeping, and proactive contracting measures to ensure workers are not falsely engaged as contractors.

Sham contracting allows non-compliant operators to gain an estimated 30 per cent illegal competitive advantage by stripping workers of entitlements such as minimum wages, superannuation, and workers’ compensation. Industry representatives argue this practice drives a downward spiral in safety standards and wages, contributing to the high fatality rates in Australia’s road transport sector.

While major retailers including Woolworths, Coles, and Wesfarmers-owned brands have engaged in discussions regarding supply chain fairness, the TWU reports that other retailers, specifically Aldi, have refused to participate in talks despite allegations of sham contracting within their transport networks.