CHANGES proposed for the Trade Practices Act could allow panel beaters to join together in their long-running battle with insurance companies over pay rates.
The dispute, which stems from insurers’ preferred smash repairer (PSR) approach, led to an Australian Government Productivity Commi-ssion investigation.
Among the investigation’s recent findings were that, while the insurance industry’s PSR move provided benefits to customers, insurers and some panel beaters, there were some parts of the process that needed attention.
The Motor Trades Association is banking on a proposed amendment to the Trade Practices Act being passed that will allow small businesses to collectively bargain.
It is expected that change to the act, recommended in the review of the Trade Practices Act by retired High Court judge Sir Daryl Dawson, will go through in September 2005.
The amendment had already received the approval of the lower house of Federal parliament before the recent election.
MTA executive director Peter Fitzpatrick said the amendment, if made law, would allow the association to act on behalf of its panel beater members in their nego-tiations with insurance companies.
“At the moment the only people allowed to collectively negotiate and bargain under the Trade Practices Act are unions,” he told WA Business News.
Panel beaters say insurers are paying them about $26 an hour to conduct repairs while it costs $43 an hour to run a panel shop.
They also say the preferred smash repairer arrangements erode their customer bases by removing customers’ choice of repairer.
An SGIO spokesman said its PSR program was designed to help smash repairers take their focus away from hourly rates and to “view their operating efficiency as a whole”.
He said the approach had been taken because it also resulted in cost savings for customers.
RAC insurance general manager James How said price came after quality and time when it came to how the RAC chose its PSRs.
While the Productivity Comm-ission draft report found the PSR arrangements were mostly beneficial, it also noted that selec-tion or non-selection as a preferred supplier could effect a smash repairer, and that the disadvant-ages of nationally agreed PSR criteria outweighed any benefits.
It found insurers could enhance the transparency of those PSR arrangements and that the funny time, funny money system should be abandoned.
That system involves repairers, with the knowledge of the insurers, inflating the estimated hours taken in the repair segment of a job to try and compensate for what they may perceive as low rates of pay.
