Service Level Agreement
This agreement is between DTF (Department of Treasury and Finance) and Toll
Priority, and is to be referred to as an attachment to the contract covering the
commercial terms of the agreement between DTF and Toll Priority.
This agreement sets out the basis upon which DTF agrees to source and Toll
Priority agrees to provide operational, logistical and courier services to DTF.
It is against the SLA that the performance of Toll Priority can be judged, both
administratively and legally, and will be reviewed quarterly by both parties.
2. Scope of Agreement:
This Agreement shall comprise the following components:
Service Level Agreement and operational requirements
Account Management requirements
Service improvement criteria
Customer service requirements
Scorecard system and reporting formats
3. Service Level Agreement and operational requirements:
3.1 Service performance criteria:
This shall be measured and agreed to in three parts:
Variance to function
Action required if function not performed to agreed levels.
The frequency is based on the required nature of the service
principally on an overnight delivery of Mail and parcels.
Allowed variance to required time
Action required if outside of allowed variance
Function Frequency Allowed variance to time
of ETA that materially
effects a customer
Scheduled Run Daily, +/- 2 hours
Return of “proof of Daily, +/- 1 day
Resolution of As Required Within 120
Customer Service minutes of call
3.2 Service alterations:
A fundamental feature of this Agreement is to provide additional courier and
related logistical capacity in line with business growth or changes in the needs of
the Victorian Government. The importance of established processes and agreed
procedures is to be mutually agreed to ensure the provision of increased capacity
is introduced in a seamless manner without customer disruption or performance
Any service changes requested by user’s to the existing service schedule must be
notified in writing and will require a minimum of 3 working days to be
implemented; 1 working day to agree to the change and 2 working days to
implement the change.
3.3 Vehicle Requirements
Toll Priority warrants that the Vehicle meets all aspects of DTF’ requirements
(a) All over white in colour;
(b) Enclosed Commercial vehicle;
(c) Of good appearance and no older than 5 years;
(d) Current Victorian registration;
(e) Meets all VIC Roads regulations;
(f) GPS or (similar) vehicle tracking and monitoring, including alarm and
duress alarm systems with floor insulation and air conditioning fitted to all
(g) Is kept in a clean and tidy condition
Failure by the carrier to maintain the vehicle in a clean and tidy condition,
mechanically sound and the body work of the vehicle in good condition may
result in the driver being stood down until such time that the vehicle meets the
It is accepted that from time to time that a replacement vehicle will be required
to cover absenteeism or to replace an existing vehicle. Toll Priority will ensure
any replacement vehicle and contractor conform to the above requirements.
Toll Priority acknowledges that its carriers are not permitted to carry a passenger
in any vehicle performing delivery runs on behalf of DTF.
3.4 Summary service list
A summary list of all customers / designated collections and delivery points with
required timings is as per schedule 2 of the contract. This summary list shall be
updated monthly and changes made available to DTF.
DTF requires Toll Priority and its carriers make out any documentation or use
such technology it deems relevant to enable the contract carriers to perform
their daily tasks.
Upon the completion of each delivery the Toll Priority carrier will obtain the
signature of each Consignee where applicable. The Toll Priority carrier must
obtain proof of delivery and pick-up time and client signature for services
conducted unless specified in writing by DTF Management.
Any discrepancies in volume or description must be reported to DTF’ or its
client’s representative immediately and again the representative should sign a
confirmation of the discrepancy.
4. Account Management Requirement
Toll Priority will make available to DTF a corporate account manager who will
work with DTF to ensure an ongoing high quality of service, provide summary
reporting and performance evaluation at quarterly meetings and act as an
escalation point in the case of service failure.
The account manager will also provide DTF with logistics consultancy in an effort
to realise continuous improvement opportunities which have the aim of:
Providing either a higher level and or
Providing the existing service more efficiently, and at a reduced cost
5. Service Improvement Criteria
A formal quarterly meeting will be held between DTF and Toll Priority. The
purpose of the meeting is to review any day-to-day issues requiring resolution,
discuss trends etc and investigate ways of improving the service and relationship
between both parties. Statistics will be kept on an ongoing basis, monitoring the
performance of Toll Priority to provide the agreed service, within the operational
The results of these meetings will be summarized by the account manager and
presented to DTF on a quarterly basis at the service review meeting. At this
meeting Toll Priority will also outline any continuous improvement opportunities
6. Customer Service Requirements
User’s are to refer all client queries to Toll Priority call centre on 13 88 44.
User’s will have a dedicated contact and telephone number from Toll Priority to
act as a reference point for any queries. The corporate account manager
assigned to DTF will only be used as a point of escalation.
A list of contacts and telephone numbers is included in the final agreement.
Both parties recognise the need to properly address customer service inquiries
within an acceptable time period.
Each customer service call made to the supplier relating to ad-hoc services must
be resolved within a maximum turn around of 120 minutes. Where resolution
cannot be provided within 120 minutes, a follow-up call must be made to advise
7. Communications Protocols
Toll Priority shall promptly notify the user of any anticipated inability to perform
any carriage of goods or of any unreasonable delay in delivery or collection of
goods. These notifications will be summarised in the daily service evaluation
Any cartons documents or goods that are unable to be delivered must be
returned to Government sort’ at Port Melbourne and made secure prior to the
carrier completing work for that day. Goods are not to be left unattended at a
user premise or remain overnight in the carriers vehicle. This shall form part of
the daily service evaluation report. Toll Priority will send a weekly service
evaluation report to the user. In general it will be an exception report indicating
performance outside of agreed parameters. It shall be sent to all nominated
managers. The format of this report will be agreed between the parties from time
The service evaluation report will be sent out before midday on the following day
with the resolution field in these service evaluation reports to be completed and
returned to sender prior to close of business. A summary of the service
performance will be prepared by the account manager and tabled at the formal
quarterly meeting between the parties.
8. Scorecard system
8.1 Service Evaluation.
Each service non-conformance will be given a non-conformance severity code.
Each severity code will be given index weighting. A table of weighting’s and
severity codes follows:
Code Description Index
S1 Minor impact/inconvenience on 1
S2 Major disruption to user’s 5
S3 Major impact on user’s 10
S1 – minor impact on user would result in either:
Service complaint by user’s to Toll Priority
Need for Toll Priority to take corrective action
S2 – major disruption to user’s would result in:
Additional costs being borne by user due to service being outside
normal service criteria.
S3 – major impact on user’s would result either
Toll Priority being required to credit service,
Toll Priority being required to reinstate/recover the service at their cost.
At the end of each calendar month, a service index will be calculated by applying
the number of non-conformance incidences by the index weighting for each
service code. If either of the following occur,
The number of S3 occurrences for a single month exceeds 15 (15), or
The total index for the month exceeds 250,
This signals a major breach of the service obligations of Toll Priority.
For the avoidance of doubt, “major” is defined as a material event where the loss
or diminution of service has caused the user to suffer a financial loss. In such
circumstances Toll Priority may be exposed to contract termination as a result of
service failure. A S3 will not be recorded if it is outside the control of Toll priority.
The most effective agreements work when both parties are required to meet
agreed expectations, which are realistic.