ELD mandate could pave way for time-based pay prevalence
Removal of the long-distance truck driver’s exemption from overtime pay in the Fair Labor Standards Act was on the radar of the FMCSA’s Motor Carrier Safety Advisory Committee in February. It’s also been on the radar of many a driver, owner-operators included, for years, particularly in light of the increasing use of electronic logging devices and onboard communication tools.
Some argue that trend removes the original rationale for exempting long-distance haulers from some of FLSA’s labor protections. Now, such thinking goes, the truck’s cab can be more or less a monitored extension of the office – not much different from a factory floor.
In February, when MCSAC prioritized items for Congress to consider as part of the next highway bill, removal of the exemption, as well as establishment of a “safe pay rate” minimum, was put forward at the meeting by Bruce Hamilton of the Amalgamated Transit Union. Ultimately, the notion found support across a sizable segment of the committee.
The “original thinking” behind the overtime exemption was to minimize “incentives to work more overtime hours” in a safety-conscious industry, said Todd Spencer, Owner-Operator Independent Drivers Association executive vice president and MCSAC member. Today, however, “technologies are all about maximizing productivity,” Spencer noted. “The 40-hour workweek went away for drivers a long time ago. … The broader issue of not placing any value on a driver’s time costs trucking billions and society even more.”
Finally, Spencer noted, the lack of time value also costs a loss of “safe and experienced drivers that no longer want any part of a lifestyle that is based on income that has been stagnant for years.” Spencer called removal of the exemption from overtime pay a difficult sell in Congress, but “the right thing to do.”Spencer’s argument for FLSA reform was similar to that of Washington state-based owner-operator Joe Ammons. Overdrive has reported on Ammons’ circulated petition (an idea he launched nearly two years ago) to reform FLSA for company drivers. Though such reform wouldn’t apply directly to independent contractor owner-operators and those with their own authority, Ammons argued that the rate dynamics resulting from improved pay for company drivers would filter positively throughout the industry. Todd Amen of ATBS, however, cautioned that he believes another primary downside risk of the ELD mandate is that it paves the way for further limiting hours. “The FMCSA strongly believes all drivers should be paid hourly and they shouldn’t work more than 40 hours a week for safety reasons,” says Amen. “ELDs head us down a road where that can be mandated.” Removal of the FLSA exemption alone or establishing a minimum “safe pay rate” wouldn’t necessarily limit drivers to 40 hours a week or even hourly pay itself. Still, in part because it would introduce a disconnect between how fleets typically are paid by their customers (by the mile) and their drivers, the notion of paying drivers hourly for all time has been called “financial suicide” for a truckload business, as a carrier executive said last year. All the same, many believe ELDs will help carriers of all sizes as they continue to establish detention pay programs with shippers and receivers to compensate drivers for excess waits. Widespread ELD use will “put pressure on shippers and receivers, where it needs to be,” says industry analyst Jay Thompson.
Pat Hockaday, commenting under this story on OverdriveOnline.com, saw the potential for ELDs to move the industry toward hourly company-driver pay as virtually the only way the devices may stand to benefit the industry. “Now that the boss is watching them continuously,” he said of company operators under ELDs, “I believe more than ever that they should be paid by the hour for every hour they are at work doing as instructed,” including waits at shippers and receivers. Hockaday outlined hourly company-driver pay levels that could be based on experience defined according to miles run.
In the long run, Hockaday noted, “This would also force freight rates to go up” and put “an end to unpaid detention time at shippers and receivers as well as forced detention by the company.”
Comments on the rule can be made online at The FMCSA’s ELD mandate proposal continues under a public comment period through late May. regulations.gov using the Docket Number FMCSA-2010-0167 or by email at oira_submissions @omb.eop.gov, using the subject line Attention: Desk Officer for FMCSA, DOT. They can also be faxed to 202-395-6566.
Submissions can also be made by mail: Office of Information and Regulatory Affairs, Office of Management and Budget, 725 17th Street NW., Washington, DC 20503, ATTN: Desk Officer, FMCSA, DOT.