The Fair Work Commission has issued a road transport contractual chain order (RTCO) that applies from today (21 April 2026) and will require companies at the top of the supply chain to conduct fortnightly reviews of fuel prices and contract clauses, and then to pay to those below them in the supply chain enough to cover the amount fuel costs have increased since 6 March 2026. This Order will apply to the whole transport industry and will be in force until average diesel prices fall below $2 a litre.
As ACAPMA covered recently, after an application form the the Transport Workers’ Union of Australia (TWU) and the Australian Road Transport Industrial Organisation (ARTIO) the Fair Work Commission has published the Order following a rushed process that has broad coverage in the industry.
Speaking about the Order, TWU national secretary Michael Kaine said, “this order will be a lifeline to transport business and our national supply chains”.
“Over the last few weeks drivers and transport businesses have outlined the dire circumstances they are facing with diesel costs, many already having to park up their trucks or rely on personal loans just to keep going,” he said.
“Many drivers in the industry are mum-and-dad operations currently being forced to subsidise fuel costs for the multi-billion-dollar companies they are carting goods for.”
Co applicant ARTIO national secretary Peter Anderson went further stating that if “the trucks stop the economy stops”.
“This order ensures that all of the road transport industry has certainty in maintaining their services and that the additional extraordinary fuel costs will be recovered from their customers.”
“This order won’t solve the fuel crisis entirely, but it will mean businesses can continue running with the knowledge that wherever price goes, they’ll be able to recover it.”
The Detail
The Order details the obligations to primary and secondary parties in the transport supply chain;
4.1 Primary parties must, within each fortnight or twice per calendar month, adjust the rate they pay to any other primary party for the performance of work in the road transport industry by the amount necessary to ensure that they other primary party recovers the increased cost of fuel from the commencement of this Order.
4.2 Primary parties in a road transport contractual chain must take reasonable steps to ensure that secondary parties engaging regulated road transport contractors or road transport employee-like workers in the same road transport contractual chain adjust the rate they pay to such redulated road transport contractors or road transport employee-like workers for the performance of work in the road transport industry by the amount necessary to ensure recovery of the increased cost of fuel from the commencement of this Order.
4.3 Clause 4.2 of this Order shall not apply to a primary party which is a small business employer and which is not a road transport business.
4.4 Secondary parties must, within each fortnight or twice per calendar month, adjust the rate they pay to any other secondary party, regulated road transport contractor or road transport employee-like worker for the performance of work in the road transport industry by the amount necessary to ensure that the other secondary party, regulated road transport contractor or road transport employee-like workers recovers the increased cost of fuel from the date of commencement of this Order.
The fuel cost recovery methodology is not specifically prescribed in the Order, rather there are several options including ‘rise and fall’, ‘benchmarking’ or ‘special arrangement’.
What is noted is that averaging is permissible to apply formulas to whole groups of contractors or employee like workers, to avoid individual reviews where averaging is appropriate.
The operation of the Order is set within the Order itself;
- The Order commences on 21 April 2026.
- The operation of the Order will be reviewed by the Fair Work Commission after 1 month of operation, where they will take submissions on the impact the Order is having on supply chain participants.
- The operation of the Order will then be reviewed by the Fair Work Commission every 3 months of operation until it ceases to apply.
- The Order will cease to apply “if the weekly average national terminal gate price for diesel, as measured in the weekly diesel price report of the Australian Institute of Petroleum, falls below $2.00 per litre.”
What now?
“With the publication of this Order it is vital that all parties in a road transport contractual chain understand the Order now, and establish fuel cost recovery mechanisms and pass through systems in the next 14 days”, explains ACAPMAs Elisha Radwanowski.
“Even for those further down the contractual chain will be required to engage with those higher up the chain so that those who have obligations under clause 4.2 of the Order can demonstrate that they have taken reasonable steps, so businesses may be called on to provide information or complete surveys. The hurried and landmark nature of this Order means that the full impact this will have on each level of the transport industry, including the fuel transport industry, is at this time unknown”, continues Elisha.
“ACAPMA is encouraging all members to familiarise themselves with the particulars of the Order, to engage with the other participants in their supply chain, and to keep note or comments on the impact of the Order so that they can be folded into submissions to the Fair Work Commission for their first review next month”, concluded Elisha.
More information
For a copy of the Order see – https://www.fwc.gov.au/documents/awardsandorders/pdf/pr798817.pdf
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Elisha Radwanowski BCom(HRM&IR)
ACAPMA
