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Driver agreement & dispute resolution for taxi drivers

There are certain conditions that, by law, are part of every driver agreement. Taxi drivers and operators who enter into a driver agreement must comply with these conditions.

Information on this page

The following conditions are mandatory requirements, even if the conditions are not included in a written agreement between the driver and the operator.

The TSC recently conducted a review of the driver agreement, in consultation with the taxi industry, and expects to publish its findings later this year. Some conditions may change as a result of the review but, until then, the conditions outlined on this page continue to apply.

Minimum percentage of fares

The driver must receive at least 55% of the gross fares earned while he or she has control of the taxi.1

Monthly records

The operator must keep, and provide to the driver on a monthly basis, records of:

  • all payments made between the operator and driver
  • all shifts worked by the driver, and
  • the amount of fares earned during each shift.

Maintenance costs

The operator must reimburse the driver within seven days for all costs involved in running the taxi, including but not limited to:

  • fuel
  • repairs
  • oils
  • taxi livery and equipment
  • lubricants
  • tyres.

The operator may nominate where the repair work is to be done, or the fuel or other items purchased from.


The driver or operator may terminate the driver agreement with two weeks' written notice, or immediately if there has been a breach of the agreement.

Operator to insure and indemnify driver

The operator must maintain an insurance policy, issued by an authorised insurer, which covers the driver against liability for third party property damage.

  • This means that if the driver has an accident while driving the taxi and causes damage to another person's property, the operator's insurance policy should cover the cost of this damage.

The operator must also indemnify the driver for the cost of any vehicle damage caused through the driver's use of the taxi-cab.

  • This means that if the operator does not have insurance, or the insurance does not adequately cover the cost of any damage, and a third party brings a legal claim against the driver; the driver will in turn have the right to sue the operator.

Operator to pay insurance excess

If the operator makes a claim on the insurance policy, the operator must pay the excess.

The operator must ensure that the insurance policy is current, and must give the driver a copy on request.

Drivers' leave entitlements

If the driver has worked for the operator regularly (three or more shifts per week) for 12 months or more, the driver may take up to four weeks' unpaid leave, on dates agreed with the operator.


The operator may collect a bond from the driver of up to $1,000, either as a single payment or in instalments each shift (with instalment amounts agreed in writing). The operator must only use the bond if:

  • the driver does not pay the operator his or her share of the fares, or
  • if the taxi or any item of equipment is damaged due to the driver conduct.

The operator must:

  • Give the driver a receipt, and deposit the bond in a designated bank account
  • Notify the driver in writing before using the bond, and allow the driver 14 days to object, and
  • Refund the balance to the driver, with interest, within 14 days of the driver agreement being terminated.

The maximum amount of the bond that can be used in any single incident is the amount held by the operator at the time of the incident.  For example, if the operator has only collected $200 from the driver and the operator wishes to access the bond, the operator must only use that $200 to pay for any damage or recoup any fare box disputes, regardless of the cost of the damage/loss, and the driver cannot be made to pay the difference at a later time.

What if I have a dispute?

The TSC has established a dispute resolution process to manage disputes between drivers and operators.

  1. In the first instance, the person with the complaint must advise the other person in writing.
  2. Within seven days of the person giving written notice, the parties must meet to attempt to resolve the dispute.
  3. If the parties are unable to resolve the dispute, they may use the TSC's dispute resolution process.
  4. The TSC will assess the nature of the dispute and decide whether to:
    1. provide preliminary assistance, for example, by giving general advice or assisting the parties to communicate clearly with each other; or
    2. take compliance action, which may include issuing an improvement notice or taking disciplinary action against a person's accreditation.
  5. If the assessing officer requires further information from the person lodging the dispute:
    1. the person will be given 14 days to provide the additional information; and
    2. if the person does not provide the requested information within 14 days the TSC will provide any preliminary assistance possible and may close the file, with letters sent to both parties advising them of the outcome.
  6. If the parties have not been able to resolve the dispute with preliminary assistance from the TSC, the TSC may issue a certificate which allows one or both of the parties to go to:
    1. the Victorian Small Business Commissioner (VSBC); or
  7. Victorian Civil and Administrative Tribunal (VCAT), if the TSC thinks the dispute is unlikely to be resolved through mediation.  If the dispute is not resolved through mediation with the VSBC, the VSBC may issue a certificate allowing one or both of the parties to go to VCAT.

The parties must go through the TSC dispute resolution process before going to either the VSBC or VCAT.

The TSC encourages parties to try to resolve disputes between themselves, wherever possible, or otherwise at the earliest possible stage.

Parties may contact the TSC about a dispute on 1800 638 802.

Drivers or operators found to have breached one of the implied conditions may be prosecuted under section 162M of the Transport (Compliance and Miscellaneous) Act 1983.  

1Section 162L(2) of the Transport (Compliance and Miscellaneous) Act 1983 (Vic). The remaining conditions were specified in a legislative instrument dated June 2014.