Decision

Decision for LEO.AL.AUTO LTD and transport manager DARREN BOYCE-SMITH

Published 3 November 2021

0.1 LEO.AL.AUTO LTD: OH2010697

0.2 TRANSPORT MANAGER DARREN BOYCE-SMITH

1. PUBLIC INQUIRY IN BRISTOL 18 OCTOBER 2021

2. BACKGROUND

Leo.Al.Auto Ltd is the holder of a standard international goods vehicle operator’s licence authorising the use of three vehicles and three trailers from operating centres on the Marchwood Industrial Estate in Southampton. The sole director is Mr Algimantas Leonickas. The transport manager is Mr Darren Boyce-Smith. The licence started on 4 June 2018.

On 26 June 2021, Traffic Examiner Andrew Dean encountered CN64NKR at DVSA’s Chilcomb check site. The driver was Illes Popovics. Checks identified that the vehicle’s MOT had expired. Mr Popovics was using Mr Leonickas’ drivers card. There were drivers hours offences. Mr Dean carried out a follow-up investigation and found further shortcomings

• No driver training conducted internally. Transport Manager had no copies of Driver CPC certificates for any drivers.

• TM had no copies of any driving licences, driver CPC cards, driver tachograph cards and no driver licence checks were conducted.

• Mr Leonickas DCPC expired in September 2019 but he had driven regularly since that time.

• The last drivers hours download was completed in August 2020. Twenty-eight days of driver download from the roadside encounter show multiple driving without a break and insufficient daily rests.

• There was no evidence of a disciplinary process.

• Working Time Directive (WTD) was not monitored.

• No forward planner showing scheduled PMIs, tacho calibration. There were also no PMI records available to analyse.

• The operator was not signed up to VOL or OCRS.

The operator responded with assurances as did Mr Boyce-Smith. However, the findings of the Traffic Examiner were so serious that I decided to call the operator and transport manager to public inquiry.

3. THE PUBLIC INQUIRY

Mr Algimantas Leonickas attended the public inquiry accompanied by his son, Mr Otas Leonickas (who acted as an interpreter) and business administrator Valdemara Leonickiene. Also present was transport manager Darren Boyce-Smith.

Proceedings were recorded and a transcript can be made available if required. I record here only the relevant parts of the evidence. In preparing this decision, I have taken as reference my public inquiry bundle, the operator’s compliance documents, my notes and I have listened to the electronic recording.

I noted that no interpreter had been requested. Otas Leonickas confirmed that he was content to interpret. I indicated that I may adjourn if I felt that the fairness of proceedings was being impaired. In the event, that did not arise and I was grateful for the assistance.

Algimantas Leonickas told me that he had started driving car transporters but wanted to be his own boss so he started the business. The work was containers.

The drivers had their own limited companies and were employed through them. I pointed out that was not lawful and why.

Mr Boyce-Smith told me that he had worked as a driver for 20 years. He had then qualified as transport manager in two stages. He had worked split between driving and transport management roles for several years. He was currently employed by SJG Logistics, who were also the stated maintenance provider. He was transport manager for three other small operations, one of which was winding down and moving to Spain.

I took Mr Boyce-Smith to the Traffic Examiner’s report at page 53 of my bundle. The Examiner had visited Mr Boyce-Smith at his flat which is where the records were kept. Mr Boyce-Smith said that he was keeping in contact with the operator but accepted he had become complacent and let things slide. He hadn’t realised the extent of that until prompted by the DVSA investigation. The Examiner’s finding that vehicles and drivers cards had not been downloaded for a year was accepted. Covid was a factor but he could have found a way round it. [Redacted]. He had not checked the drivers’ CPC qualifications nor their driving licences.

Maintenance was by SJG. The operator had occasionally used Sparks Commercials due to communication breakdowns. The operator had only given SJG two weeks’ notice of the recent need for an MOT and Mr Boyce-Smith had explained to him that was unacceptable. I noted that Sparks conducted brake tests whereas SJG rarely did so. Mr Boyce-Smith told me that he would ensure that it was done every other PMI in future. I asked: why “every other”? Mr Boyce-Smith seemed oblivious to the requirement for every PMI to cover every item within the MOT. On checking again, there had been only one brake test undertaken across all three vehicles in six months. Mr Boyce-Smith had no answer to not having identified that SJG had simply put a line through the section on brake performance. I also asked for comment as to why Sparks Commercials inspections identified numerous significant defects whereas SJG rarely found anything. Mr Boyce-Smith said that Sparks had over-stated the defect in relation to a corroded brake disc.

Mr Boyce-Smith referred me to the improvement plan he had put in place since the DVSA investigation. He had undertaken a transport manager refresher course. Tachograph analysis was happening weekly. There was now a wall-planner.

I asked about Mr Popovics. He had been previously employed but there had been problems and he had advised Mr Leonickas not to use him again. He had not been aware that he had been used on 26 June. Mr Leonickas had left his driver card on a tray on the dash and Mr Popovics took it upon himself to use it.

I asked Mr Algimantas Leonickas how he had been introduced to Mr Boyce-Smith. It had been through SJG and he came recommended. He had initially met with him every week but after a while it became less frequent, maybe once a month or three weeks. I asked him why his tachographs had not been downloaded from August 2020 until July 2021. He had been recommended to buy a download tool but he thought that was the transport manager’s job. He had now bought the tool. He accepted that he had not overseen the transport manager appropriately. That was his mistake. He had been too focussed on doing the deliveries.

Ms Leonickiene told me that she had recently started as an administrator working about 10 hours each week. It was she who had prepared the operator’s documents for the inquiry – and I commended her on their order.

Mr Leonickas told me that the company could not cover its costs with only one truck. Revocation would be the end of the business. I reserved my decision.

4. CONSIDERATION AND FINDINGS OF FACT

Mr Darren Boyce-Smith accepts, quite simply, that he did nothing as transport manager over the period of eleven months. It may be far longer; the operator’s CPC expired in September 2019, long before Covid and lockdowns and Mr Boyce-Smith was blissfully unaware. That he has created an action plan over the past weeks and that the job now seems to be getting done to a basic level is a positive but it cannot offset the damage done by a year of complete inaction. Even now, he had failed to identify the fundamental shortcomings in the PMI reports particularly the lack of brake testing of any description on all bar one inspection.

Mr Boyce-Smith has for a period of at least eleven months been a transport manager in name only. He spoke almost as if to chastise Mr Leonickas for what he saw as Mr Leonickas’s failure to give the maintenance provider enough time to arrange an MOT, failing entirely to see that it is the transport manager’s job to ensure that such activities are planned and executed. As a transport manager, Mr Boyce-Smith is entirely ineffective. No refresher course can, in two days, imbue a transport manager with the necessary passion for compliance. He could not even take the time to compile the operator’s public inquiry bundle, hopelessly referring me to a document that was not contained therein. I have no hesitation in finding that Mr Boyce-Smith has forfeit his good repute as transport manager and requires a period of time away from the role to reflect upon his own failings prior to any re-entry to the industry. Fortunately for him, as a qualified HGV driver, he should not currently be without well-paid employment.

Mr Leonickas allowed his driver card to be used by another driver. That is a reckless act. He accepts that he failed to supervise his transport manager. He allowed his time to be disproportionately spent on delivering for his customers at the expense of compliance. But he did so almost unwittingly rather than in any conscious disregard for compliance.

Drivers are employed through their own limited companies. Mr Leonickas told me this openly and I do not believe he was aware that it is unlawful. As the RHA fact-sheet on the matter states

“Unless they are an owner-driver, it is very rare for a lorry driver to be legally “self-employed”.”

The position of self-employed drivers was considered recently by the Upper Tribunal in the case UT/2019/54 Bridgestep Limited. It was a case where the drivers had formed their own limited companies. In compliance with HMRC rules for being self-employed, the drivers were afforded significant freedoms in how the work was organised. To do otherwise would mean that the drivers were employees. This is what the Upper Tribunal had to say about the matter:

1. We are satisfied that the TC’s determinations about the company’s arrangements with its drivers are beyond criticism. This was a bad case in which the company and transport manager had made a conscious decision to enter into an arrangement with the company’s drivers which was highly questionable if not a sham. The reasons for doing so were anti-competitive being as they were, concerned solely with the cost of employing the drivers and by reducing that cost, gaining a competitive advantage over other compliant operators. Whilst the vast majority of new operations make the right decision to employ their drivers, paying national insurance, pension contributions, holiday and sickness entitlement, these Appellants did not do so. The consequence of that decision was that the company and the transport manager felt unable to give any instruction to drivers whether it be in relation to route planning or otherwise and as a consequence, were unable to have continuous and effective management of the transport operation. That is plain and obvious from the contract of services that was later provided to the TC with some of the clauses set out in paragraph 13 above. In short, the company and transport manager had abdicated their responsibility for ensuring that the transport operation was compliant and safe in order to save money. This was the real mischief that was revealed during the public inquiry.

2. The seriousness of the conduct of the Appellants along with their failure to rectify the position in the five months leading up to the public inquiry meant that both Appellants rightly lost their good repute and that was a proportionate response in the circumstances. The company deserved to be put out of business and in view of its failure to change its arrangements with its drivers, it was entirely proper that the licence be revoked.

Whilst the business is constructed as it is, with drivers employed through their own limited companies, I cannot answer in the positive the question “Is this an operator that I can trust to be compliant in the future?”. When the answer to that question is “No”, it is difficult to find how it is not necessary to put the company out of business. As currently constructed, the good repute of the operator is found to be forfeit.

However, this is an issue which only became apparent on scrutiny of bank statements and was not in the call-in letter because it was not known in advance. It is only fair that I give the operator the opportunity to correct matters. I acknowledge that cannot be done overnight but it needs to be done at pace. If it can be demonstrated that drivers are “on the books”, with tax and national insurance deducted at source, holiday pay in place and pension contributions made as appropriate, before the end of a period two months from today, I will consider that good repute has been re-established and set aside the revocation decision.

The company allowed its transport manager to get away with doing nothing. Either directly or indirectly as a result, a driver was driving using another’s card. Drivers hours offences were committed. Maintenance was sub-standard in that there was no brake testing. A vehicle was in use without an MOT. A driver has driven without a valid CPC. I find that Section 26(1)(ca) and (1)(f) are made out. I attach significant weight given the lack of management control to prevent those matters and that the director was directly implicated in two of them.

5. DECISION

Pursuant to a finding of loss of good repute, Darren Boyce-Smith is disqualified from acting as a transport manager in the UK or any EU Member State with immediate effect and until 20 October 2023. Amy application to re-enter the industry will require a clear demonstration that he has acquired a genuine thirst for compliance.

Pursuant to a finding under Section 27(1)(a), loss of professional competence and Article 13 of EU Regulation 1071/2009 (as adopted in to UK law), I grant a period of grace of two months for the operator to find a new transport manager.

Pursuant to a loss of good repute, primarily through the improper arrangements with drivers, the licence is revoked with effect from 1 January 2022. If good repute is re-established by a demonstration that drivers are properly employed, provided to my office by 20 December 2021, this decision will be set aside.

Pursuant to findings under Section 26(1)(ca) and (1)(f), the licence is curtailed to 2 vehicles for the calendar month of January 2022. The vehicle to be removed from the licence must be notified to my office in advance and I order, by virtue of Section 26(6) of the Act, that it not be used under authority of any operator’s licence during the period of curtailment.

Kevin Rooney

Traffic Commissioner

20 October 2021