The recent Public Inquiry of MOT Commercials Ltd before Deputy Traffic Commissioner Gerallt Evans highlighted an issue that occasionally pops up in Public Inquiries. That issue is the contractual relationship between the Transport Manager and the Operator.
Transport Managers need to be individuals employed by an Operator (Internal), or there needs to be a contract for services in place between the Transport Manager and the Operator (External).
What cannot happen, as did in the case of MOT Commercials Ltd, is that the Transport Manager is engaged or paid through a separate limited company.
A more historical problem, which Jared has not come across for a while, is where a transport consultancy company ‘provided’ a Transport Manager but then issued an invoice to the Operator for the Transport Manager’s services and separately paid the Transport Manager, presumably having retained a percentage.
The STC’s Statutory Guidance highlights that The Upper Tribunal has also warned against tying in the provision of a Transport Manager with a consultancy service.
Paragraph 14A of Schedule 3 of Goods Vehicle (Licensing of Operators) Act 1995 refers to the fact that the Traffic Commissioner must be satisfied that the person has a genuine link to the Operator.
So, this wouldn’t be met in the circumstance of another company being in the way, whether that be a consultant or umbrella company.
Actions for Operators
Operators and Transport Managers should have a written contract in place, whether this be an employment contract or a contract for services.
This contract must be directly between the Operator and Transport Manager, and it should be ready and available to send to the OTC if requested.
The full decision of MOT Commercials Ltd can be found here.
Jared Dunbar can advise you on maintaining compliance with the above and other Transport Law matters. Contact him for support.