Hire must be treated in the same way as freight

Hire must be treated in the same way as freight

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I have come to conclusion that hire must be treated in the same way as freight, and that to do so is not an extension of established exception. It is only in comparatively modern times that the word ‘hire’ has been used. It was formerly known as time freight or time-chartered freight. Indeed, in marine insurance terminology, freight still includes hire.

The word freight has numerous meanings. Beaver defines it as the sum agreed on for hope of a ship, entirely or in part, for the carriage of goods. This is now the usual meaning of this word in law. In common conversation, however, it often means also the goods carried. And that is this ways, if not its original meaning, one of its early meaning, is certain from the case in 1620 (Wise and Freund, 2005). Formerly, it was considered as the action of covenant by the merchant with a master of a ship, that, if he would bring his freight to such a port, he would pay him such sum (Seijts and Latham, 2005). Now, however, it means the sum to be paid thereafter. For, if a ship owner carries his own goods only, he may in sure his freight, meaning what another would have paid him for carriage of the same goods on the same voyage; or he may include it in a valuation of his ship or of his cargo.

A legal distinction is made between “hire- or- reward” and “own-account” road freight operations in most European countries. Hire – or – reward operations also referred to as for hire professional haulage, public haulage or third party operations are transport services provided on a third party basis by road freight transport contractors. The “Hire – or – reward” operator will in many cases carry a number of goods belonging to a number of companies who pay the operator for these services (Whyte and Saks, 2007).

Own-account operations also referred to as in house operations are road freight transport activities carried out by the manufacturer, wholesaler or retailer of the goods themselves in their own vehicles. Own-account operations are typically subject to less stringent regulations and obligations than those placed on hire-or-reward operators. However in return, own-account operators are prohibited from performing work for Hire-or-reward (Baum & Locke, 2004).

The legal distinction between hire-or-reward, and own-account operations which is used in the licensing or registration of vehicles, can therefore be seen to be a matter of who is responsible for the transport of the goods in question: the person who produces, owns works on or has borrowed the goods on (own account), or a professional haulage contractor (hire-or-reward). The distinction between the two kinds of operations is used in other countries for other purposes including government data collection, and freight industry market research and analysis (Pinder, 2008).

It is important to recognize that within own-account operations, there are two quite distinct categories of operations. This type of operation can range from a company or an individual with a single vehicle transporting small quantities of goods locally on an infrequent basis, to large companies with sizeable vehicles fleets of 100 or more , moving significant qualities of goods either nationally or internationally (Drach-Zahavy and Erez, 2002). Operations in which the primary purpose if the vehicle is to transport a crafts man, workman, engineer or other service provider (for example, plumbers, carpenters, builders, etc) and their necessary tools and equipment to their place of work (Seijts and Latham, 2005). This type of operation will often involve the use of relatively small commercial vehicles which can remain at the place where work is being carried out for long periods of time (sometimes many hours), unlike typical freight collections and deliveries. Although goods may well also be carried in the vehicle, this is not the sole purpose of the vehicle trip. However, in general, both the above operations are considered to be own-account operations and therefore treated the same way for regulatory purposes.

Admission to the road haulage industry in the EU member states is covered by the directive 96/26/EC “on admission to the occupation of the haulage operator”. This directive details the conditions that must be met by operators wishing to enter the Hire – or – reward sector: these are that the operator must be (i) of good repute, (ii) of appropriate financial standing and (iii) professionally competent (Drach-Zahavy and Erez, 2002). However, according to Lowe (1998), the UK is the only EU Member state that insists on similar conditions for own-account operators, requiring them to be (i) fit and proper persons and (ii) of appropriate financial standing.

Own-account transport operations exist throughout Europe; however the importance of own-account varies from one country to another (Baum & Locke, 2004). The registration /licensing controls on own-account operations also vary from country to country. Some countries have a system of regulation that subjects own-account operators to both initial and periodic scrutiny of their operations together with day- to -day traffic enforcement scrutiny. In others, the registration process may be more of a formality, with relatively limited scrutiny and a greater reliance on the use of day- to- day traffic enforcement to ensure compliance with regulations (Drach-Zahavy and Erez, 2002). In general, licensing controls are less stringent for own-account operations than for Hire – or – reward operations (Locke and Latham, 2002). As a result, some regulatory authorities are keen to ensure that the goods being carried in own-account vehicles are not being carried for Hire – or – reward. Therefore in some countries there are either restrictions or bans on own-account operators using hired in vehicles to be driven by their employees.

The majority of own-account operators in the EU are conducted at the local, regional or national level and are therefore governed by any national regulations regarding own – account operations. Some own- account operations are carried out at the international level ( for example a manufacturer moving its product between two of its distribution centres located in different countries): these own-account operations performed between EU Member states must comply with several conditions (Whyte and Saks, 2007). However, international own-account operations are relatively minor in terms of the local road freight work performed in the EU (Selden and Brewer, 2000). In 1995 in the EU, domestic hire –or –reward operations accounted for 597 billion tonne –kilometres , domestic own-account operations accounted for 223 billion tonne –kilometres , international hire-or –reward operations accounted for 162 billion tonne –kilometres own-account operations accounted for 9 billion tonne-kilometres. Domestic own-account and Hire – or – reward and international Hire – or – reward operations all increased significantly in terms of tone-kilometres performed between 1985 and 1995, while international own-account operations remained virtually unchanged (Scharf and Smolders, 1999).

Several studies from the 1950s to the early 1980s considered why many companies chose to operate own-account transport. In 1958, survey of own-account operations in the United Kingdom, by Traders road Transport Association, found out that the most important reason given for operating an own-account fleet was speed and reliability of delivery, followed by the cost of the operation. Other survey work in the UK by Cook 1967 and Westwood 1985 found out that companies who operate own-account vehicles justify this choice on the basis of the control over the quality of service that this [provides them with. Further support for the importance of issues of control and reliability can be found in Cooper 1978 and Foster 1978 (Pinder, 2008).

However, since the late 1970s, the quality of hire-or-reward operations has improved significantly and the range of services offered has expanded. There has been a shift from own-account operations towards the use of hire-or-reward services that has taken place in the road industry. The standards of hire-or0reward services have risen and their efficiency has improved greatly, the specialist management skills and operational experience offered by the third-party operators may result in improved services at lower rates (Pinder, 2008). Many new services have also been developed.

Although the dominant trend since the 1980s has been towards the outsourcing of road transports other logistic activities, many companies still choose to operate either all or part of their distribution operation in-house. Fermi 1990 has highlighted the main reasons for keeping some own-account distribution activities (Fermi, 1990). He says, operations at cost plus could be run more cheaply in-house, assuming other variable remain equal. This is because the third-party distribution company needs to make a profit on its operations (Whyte and Saks, 2007). In this view, having in-house distribution operations, the company will have more control over important customer service consideration such as delivery reliability and a degree of compatibility with other company activities and practices (Cornelius and Schwab, 2003). Flexibility of operations is also seen as a possible advantage of retaining an in-house distribution function, where the loyalty of the distribution operation is not torn between several customers.

Even though own account and hire-or-reward operations are, in many cases, different and a clear distinction can be made between them, it is important to note that the two types of operations are own-account services for the purpose of transportation good form one place to another, supplement this with hire-or-reward services, either on an occasional or regular basis. Between 1980 and 1997, freight moved account by own-account has remained fairly constant at around 36 billion tonne-kilometres whilst freight moved the hire-or-reward operators has more than doubled from 55 between 1980 and 1997 (Drach-Zahavy and Erez, 2002). Coming with the right compensation package for an expatriate would require a multi pronged approach because it would be predicated upon satisfying a number of interests. The key components that ought to have been addressed by a comprehensive package include base salary, hardship premium, allowances and benefits were never touched.

In the mid 1970s, two types of transport service dominated the United freight transport and distribution marketplace namely, general haulage service and own-account operations. Haulier’s usually operated on a regional basis and provided services mainly to clients that were also based in that region. It was, at that time, relatively unusual for a haulier to have a national network of depots (Gully et al 2002). The fleet of the larger own-account operations would, in many cases, provide an exclusive delivery service for the owner’s business and vehicle could be either based on manufacturing plants or at depots located around the country.

In 1980s, the United Kingdom market was characterised by a progressive handover of distribution responsibilities forms the manufactures’ and retailers own-account fleets to third-party specialists’ contractors. In many cases, the specialists’ contractor also took responsibility for the warehouse operations. As Cooper and Hornstone 1990 argue, freight transport deregulation in the UK in 1968 was a prime factor in the development of more specialized for own-account transport. Indeed, they note that it is hard to resist the conclusion that increased specialization of services is a shared consequence of deregulation in the United Kingdom (Shantz and Latham, 2009). The Route master for a long period never did any changes to the designs of their buses something has made them less sustainable in terms of environmental impacts, however, their original design was done to increase safety and reduce its emissions to the environment because of its construction from steel rather than timber. Since the end of world war 11, the reconstruction of the Shinkensen trains commenced after a long period as a result of building Japanese economy to increase freights for commuters. The first Shinkansen to be constructed was a development of the Romance car (Jay, 2004). In the 1950s in most developed countries, the railway transport was believed to be outdated however the president of Japan National Railways, Shinji Sogo was committed to the development the high speed railway that show the evolvement of the Shinkansen in 1950s.

It may be remarked in the outset, because the principle lies at the basis of the law of freight, that the ship and the cargo have reciprocal rights against each other, and reciprocal lines enforce the rights of each against the other (Whyte and Saks, 2007). The ship-owner undertakes and promises to carry in his ship the goods of the future shipper to their destined port in safety, by the proper route, and in due season. This implies a promise that his ship is seaworthy in all respects, that it has a sufficient master and crew, who will take due care of the goods as to lading them on board, carrying and delivering them, and who will navigate the ship to her destined port in the usual way, without unnecessary delay or deviation.

The evolution, over the last few decades of the global economy from a combination of closed economic systems to one of great interdependence between different nation-states has presented new opportunities and challenges to most enterprises (Jay, 2004). One area of operation most affected by this is the Human resources (HR) department, where managers now have to design their strategies to take in to account the different socio-political and economic environments that their businesses operate in. It is essential for any company hoping to take advantage of these new possibilities that its factors of production- notably skilled and/or specialized labor and capital have sufficient mobility.

Yet for labor mobility to be profitable, there has to a balance of factors so that knowledge and skills can be made available where and when they are needed at a commensurate cost (Jay, 2004). Because of this, use of expatriates is commonplace, but alongside that, comes the challenge of balancing interests, which are mainly those of the company, local communities from which the expatriate will operate from and the expatriate’s own interests. One way of balancing these interests is to come up with an international compensation package that is sensitive to the needs of all the stakeholders (Drach-Zahavy and Erez, 2002).

To assert the fact that Hire must be treated in the same way as freight, taking an example of the United States case is essential. The United States legal response to workplace bullying has been slow compared to other institutional stakeholder’s education and advocacy efforts that trace back their roots in the late 1990s. One such example is the Namie’s Campaign against Workplace Bullying, which began doing research on possible legal action against workplace bullying. It examined the potential popular and statutory remedies, concluding that the legal system at the time did not play compensatory and preventive role in extreme workplace bullying situations. That research was updated in the year 2004, setting forth the first vision of a Healthy Workplace Bill.

Extensive analysis of claims related workplace bullying concluded typical workplace bullying such as protected-class discrimination and sexual harassment seldom resulted to prosecution or compensation. The common reasons given by the courts about the issue was that the behaviour complained about was not outrageous and sufficient to meet the tort of the issue. Furthermore, some states have workers compensation statutes that pre-empt claims of workplace bullying. The following are some of the legal cases that need amendments to fully represent victims of workplace bullying.

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