Panel: Paying drivers by hour would be ‘suicide,’ driver pay raise looming

| October 24, 2013

dockFleets should be reluctant to abandon paying drivers by the mile — such was the conclusion of a panel on driver compensation, recruiting and retention, hours of service and driver health and wellness held for fleet managers at the American Trucking Associations’ annual conference this week. 

Driver Raise ClockCountdown to a capacity crunch and a boost in rates?

But, the panel also concluded, driver compensation must be changed enough to make sure drivers are paid for work done and time spent not behind the wheel. And 91 percent of ATA’s long-haul truckload carrier members say they have either already raised river or pay or plan to in an attempt to boost recruiting and retention. 

Overdrive Senior Editor Kevin Jones has a full write-up on OD sister site CCJ, detailing the panel discussion that included ATA Chief Economist Bob Costello, ATA Senior Vice President Dave Osiecki, Gordon Trucking Chief Operating Officer Steve Gordon and Werner Enterprises Chief Operating Officer Derek Leathers and Wal-Mart’s Vice President of Transportation, Jeff Flackler. 

Costello noted that driver pay, compared to 1990, has 10 percent less buying power today. For a job that’s so highly in demand by an industry, that’s uncommon, Costello said at the panel. 

Factors Fueling Driver DemandDriver shortage: Many are called, fewer are chosen

When posed with the question of whether it’s time for the industry to move to paying drivers per hour, Gordon said an hourly pay scale would be “financial suicide,” and that carriers can’t disconnect how they receive the business receives its payments from out it pays drivers. 

He did say, however, mileage-based pay needs adjustment to properly compensate drivers for their time not driving. Too much, Gordon said, shippers dictate drivers’ schedules and make it impossible for carriers to plan a schedule for and pay drivers a predetermined amount. 

The panel also talked the competition private fleets give for-hire fleets in recruiting. Flackler says Wal-Mart pays its first-year drivers on average $76,000 a year. Two-thirds of the pay is based on mileage and the rest is based on activities. Plus their drivers get a solid benefits package, he said. 

Wal-Mart’s driver turnover rate is only 5 to 6 percent, he said. The catch is Wal-Mart hires very selectively: Only 350 drivers were hired out of 13,000 applications in 2012, Flackler said. 

Click here to see the full write-up on CCJ.

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  • Jason Haggard

    Wow, imagine that. The ATA doesn’t want drivers to be paid for all of their time worked. They endorse free labor for the large carriers that they represent, the same carriers who are ripping drivers off at an alarming rate.

  • CaptainUSA

    The ATA members Drivers smart enough to know who they are doing a great job for?

  • TWade

    I know a Gordon driver and based on how many miles a week he drives and his time sitting, it would be suicide for Gordon to pay by the hour. He sits for one to two days a week on the road with no pay, and if he visit a family member during this time it is counted against his home time. And they have the ignorance to ask “why can’t we hire drivers”.

  • Debieve

    I just did a calculation of what I would make according to miles driven/ on duty not driving time/ and I believe My boss-man should be paying me rt around 50.00 dols an hr..The reason this doesn’t work is because we as drivers would bankrupt companies..understand this people we are worth far more than per mile wages!

  • Shawn L Hubbard

    I work locally and I am a dedicated driver for a large distribution center. We get paid by the load and for all work done. For example, a load from Fontana to Long Beach pays $76 round trip. If I pickup a load in Long Beach to bring back to the DC, thats an extra $33.25. If I have to move an extra trailer at the store, that’s $12.50. If I get detained more than an hour, that’s paid $19 an hour. If I break down, I immediately begin getting paid hourly and if I fuel, I get paid $20. Out of route miles are paid at .46 cents a mile. In this way, I never feel like I’m being paid less than what I deserve. Drivers should be paid for the work they do, and receive a fair wage.

  • Mind Games

    There’s no excuse NOT to pay by the hour! SINCE it was the largest carriers that demanded e logs. The jigs up all shippers and receivers can see the clock ticking too!
    Also many companies have already switched to pay by hour and those that do and have done so will be the last man standing in the long run as everyone will soon figure out who the real thieves are.
    You guys do the math that have e logs and you tell us who the thieves are!
    The only reason why they don’t want to switch to hourly rates is because you just may up and leave that thief!!!
    I say let’s put em all out of business just by giving them their keys back and everyone should go to smaller companies where you would be treated like a person and the rates would go up and so would your pay in the long run that is.

  • Mind Games

    I can understand not paying for sitting all good but if my truck moves and I gotta deal with traffic bad weather etc then pay me!
    If I gifts sit at a Cust then pay me!
    I don’t want a hand out just pay me what ya owe me!

  • John Scott

    The ATA is for the business part of trucking. Not the driver. But in terms of implementing hourly pay or some other besides by the mile. Need I mention that we don’t even get paid for all miles. Most are paid by some sort of reference guide for miles. But we are not the only system that uses a special scale. Auto mechanics have work for flat rate hour system for a long time. It was designed to make it fair to consumer. In the end even that system is skewed. Hourly is the most fair, because a hour worked is a hour paid. We certainly have enough verification now to correctly monitor hours worked. We should be paid for loading, unloading, fueling, inspections and driving. These are all required for us to do and are DOT required on duty status. Why anyone like the ATA would think a driver should not be paid for these on duty services in a hourly pay system is only concerned about the effects on the trucking company.

  • John Scott

    You make some good points and at least your pay is well defined. I think the argument of pay per mile never came about until the pay per mile began to slow down its increases. To keep up with inflation. Any pay is Ok as long as most believe its worth it. When it stops being worth it. People begin to demand change. We think hourly pay would be better, but their would be nothing stopping a company from paying minimum wage? Would that be better or just another way of paying us the same?

  • John Scott

    No matter the way you want to figure it. Companies pay what they can afford and still make a profit. If they changed to a hourly scale I imagine it would end up paying the same.

  • PattyCakes

    ‘ We can start you here at next to nothing … with hard work + diligence, in twenty or thirty years you can be making almost double that ‘

  • conda

    I don’t thing you ever drover the Truck or whats it take to be a good employee

  • conda

    hi non of the complanies care for us. If you are a driver or employee or not.
    maybe some do.

  • Shawn L Hubbard

    Yeah, I’m thinking you’re dreaming if you really believe a company driver should make $700 a day (14 x $50 an hour).

  • Del Ray Johnson

    I say this it is very simply a minimum wage of $50 per hour, plus overtime at time and half after 40 hours with no exceptions.

  • e maze

    A driver who considers himself a “professional” knows what it takes to get the job done right. It wouldn’t be a bad idea to beta test some of those drivers by putting them on an hourly scale or even salaried. As for me, I have always said that if you put me (I am the exception, but there are more of us out there) on a salary, I would produce more profit than the company gets from me on the hourly rate (as a local day-cab driver) simply because of the reliability of always knowing what drivers you have for the entire driving day/hours. Of course, the lazy employees will still be found to mess up the works by taking advantage of the situation. But,sign me up, work my ass off and pay me what I’m worth, and, I’m your positive bottom line.

  • Greg Thomas

    As a driver who has over the years has been paid by the mile,percentage of load/per load,and hourly I have found not only is hourly the fairest compensation it is also the safest,for all concerned.Speaking for myself as a percentage driver some loads pay great and to make money on others you drive to hard to fast and that is just stupid yet yes I did,and dangerous.By the mile I have never been paid for the actual miles I drove always some chart or postal zone BS plus not receiving compensation for load/unload and breakdowns or worst traffic delays .Hourly with all the on board tracking devices available companies can keep track of drivers progress throughout the run,so those who would milk the system can be identified,and companies would find drivers that are happy and satisfied are better employees and better representatives for the company plus they stay longer!

  • DER

    Drivers just need to shut all trucks down and DEMAND our respect and pay for two days.

  • Mind Games

    If I gotta sit! Sorry android took over my spellkng .

  • Dave Nichols

    I was doing some math a while ago. seems a driver could work about 84 hours a week after 5 days plus a day and a half reset. the new rules have taken away a half hour a day of work time, (rest break) plus the 6th work day that used to occur after 154 hours. This due to the once reset a week rule. So the total lost payable time a week is 16 hours, or 832 hours a year. Thats a loss of at least $14976 just at $18 straight time. This may not effect carriers so much as they might hire more drivers if they can be found. But it is a serious blow to earning capacity for drivers of all types.
    It is perhaps a good thing that we will have a more normal work/sleep cycle and some time for family and activities and may even allow ability to cammond better wage rates. time will tell.

  • Dave Nichols

    drove a lot of miles. learned that speed means very little. used to fly down the road for hours. stop for dinner and by the time the food was in front of ne the guys running speed limit were being seated nearby.

  • guest

    They WILL need to RAISE pay to keep a driver interested in Today’s trucking which is quickly LOSING drivers. WHERE will they Find this EXTRA MONEY??? Shippers wont pay EXTRA?? Companies operate on a Small profit margin to begin with….it IS a dilema….the “job” is Torture today….Old Guys are running for the exits…YOUNG guys can see its a WASTE of TIME…….Hourly Or Monthly pay…it is going to be Hell to keep a driver in a truck very soon.

  • g

    Where do I sign up??

  • guest

    Mega Fleet Execs are seen on television BEGGING congress to pass IMMIGRATION REFORM…so they can HIRE these foreigners (for Dirt Cheap) to fill the seats of their crappy beat trucks. ATA former president WROTE the legislation with Mccain Immigration Reform..
    IF it does NOT pass…Trucking Execs will petition for H2B Visas for Foreign Drivers because of this Manufactured Shortage of Drivers they are CREATING by ripping off working men..shorting their miles, low pay, no detention, horrible treatment etc….not to mention them Cheering FMCSA to Mandate EOBR etc and CSA…to further CREATE a driver shortage….and get their hands on that CHEAP FOREIGN LABOR. They Salivate at the expanded PROFITS they will make with Jose and othe Dopes driving for 12CPM.
    Hopefully 2 Immigrants in every Truck in their FLEET!!!!! Nirvana for a trucking Executive. THIS is exactly where they are pointing the trucking industry.

  • Jason

    Here we go with the shutdown talk again. HOW many times are we going to talk about a shutdown. You can’t get 2 drivers to agree on what’s the better food at a truckstop let alone when to shut down.

  • out of work trucker

    I think everyone has missed the point in the article. if they go to hourly pay for drivers. it will be something like $4.00 an hour or lower. I have talk to several drivers that said when they made hourly wages. it was like $6.00 an hour for each hour worked on the 70 hour clock. and there was no overtime pay for over 40 hours. they said it was worse then mileage.

  • http://truckerdesiree.wordpress.com TruckerDesiree

    Easy math, increase driver pay , reduce turnover, increase retention but these guys need to have conference after conference to debate moving away from the indentured servitude, “bait and switch” method of employment. Remove the advertising budget and recruiting magazine industry and use that saved money to improve work conditions…but no,,,that is too humane… The last time I saw this conversation in one of the transport topics mags they allowed David Parker give a quote about how competitive the pay was at Covenant Transport which was a complete lie, it is one of the lowest paying carriers. But these trade publications allow misinformation to be printed just like they allow this entire misleading recruiting industry to exist. They profit from exploiting people, always 100% turnover, always having some expensive shindig to talk about improving retention, always crying driver shortage… It’s a dog and pony show

  • Patricia the dispatch

    LOOMING like it was the plague. The last time you got a pay raise did you feel like it was LOOMING. how negative is that. These guys work hard and deserve a raise. They make many sacrifices in life while they are on the road. Most of the decision makers, wouldn’t ever be able to handle the lifestyle of a truck driver. ‘ON THE HORIZON’ I think would be a better term

  • trucktracy

    This guy hit it on the head. Stop driving for the big companies. This is all by their design. The gov is in bed with them and they get the laws and rules they want. We have nine trucks, 4 of which are sitting in the yard, nobody wants to drive otr. The driver crunch is for real. But I can not do anything about it. I can only decide rates to a point , but at some time the market place takes over. That leaves us with a pie that has only so much available for driver pay. We as a trucking company have to make money or we will not be in business for long. I can tell you this, each one of my drivers make more money per week, per month, per year than I do. My drivers ave 1100 per week gross. I do not think they get paid enough, but reality is there is no more to give them and remain a solvent business. And you can break that pay down however you want. One thing that I see all the time is the same drivers make 12 to 13 hundred a week and the same drivers make 7 to 8 hundred a week. I have no favorites and am making more more money off the guys making more money. At an hourly pace the guys at the bottom would be costing me even more money . It isn’t about hourly or by the mile to me. It is about making more. Each person has to take responsibility for themselves and start by not helping the system that is screwing you over. Quit driving for the big companies.

  • Janet Brockel

    thank you my husband alternates between regional and local local pay alone is 11.50 an hour i dont know but if he has a local week we are hurting bad after benefirs and tases so i dont know about the hourly thing this is just an observation from a truckers wife who has to stretch things

  • Tall Paul

    Always remember: The ATA is the Anti-Trucker-Association.
    They only care about the carriers that pay their dues, not the guys and gals in the driver’s seats.

  • Jeff Harrington

    what would a fair hourly rate be?

  • Mike

    What’s SUICIDE, is the low RATES. Low rates means low pay for everyone but the corporate shippers. If you have access to the load board in the So West you will know what I mean.

    The there is only one way a broker can post loads for $1.22, (even less), to around a $1.45 per mile. (It costs 50 cents a mile just for fuel. If you have to use newer equipment it cost about a $1.00 to $1.73 a mile in costs). And that’s if they have Mexicans to move it; which So. CA has. Just look at Fontana, CA and surrounding area, almost all Mexican trucks & Mexican truck drivers.

    CA’s gov. Brown is moving to allow Mexican illegal aliens, no, Mexican Invaders, to have DRIVERS LICENSES. The Mexican families are buying trucks putting their Mexican names on them and hiring their Mexican relatives & friends from mexico to drive the trucks. (The evidence is fairly clear. Gov. Brown’s move to allow Mexican to have lic.’s, the Mexican’s driving the trucks, the low rates).

    It is an outrage for people like Kevin Rutherford to try to “muddy up the waters”, and attempting to disguise low rates as some kind of “fair” competition. There is nothing fair about allowing massive numbers of 3rd world people to come into our country to supplant us, the very people who’s forefathers made this country possible by colonizing it and settling it from sea to shining sea.

    We are experiencing a new form of genocide at the hands of our own government. A government turning into some kind of communist/corporate monster mix. Ever thing we are seeing points to it.

  • bbmyls2go

    carriers can’t disconnect how they receive the business receives its payments from out it pays drivers. HUH?

  • Kevin J. Reidy

    The ATA wants to keep their slaves on the plantation.

    God forbid they have to pay the people that actually MAKE THE COMPANY ITS PROFITS adequate compensation for every hour worked.

    Not one of the people currently running the ATA have spent months in a truck, getting paid for only two-thirds of the actual time spent working.

    The guys that started those companies are all long dead or gone now.

  • EF McHenry

    100% CORRECT! Big Business and Huge ATA(American Trucking Association)carriers want to increase the size of labor thus decreasing the demand for labor thus reducing the need to offer a competitive wage down. And this is throughout every industry! Because even if immigrants don’t directly take a trucking job but rather displace a American Male from lets say a construction job or plummer etc, they’ve just pushes another able body person into the would be market of potential truck drivers. So the law of Supply& Demand applies to the labor market as well! Good Comment!! Keep The Borders Closed!
    A Side Note:
    Legal and illegal immigration added 10′s of millions of males to our population since it’s males that usually immigrate! This has consequently had a negative effect on the availabilty of single available females for Single White American Male and his options of finding a mate! See gender ratios

  • EF McHenry

    I totally agree with you!! However bigbusiness has actually found benefits to what I like to call ”The revolving Door Of Employment.” The get to keep senority low thus pay low, they get fresh meat that’s typically easier to manipulate, and big turn-over and this so-called said shortage has lead to corporate sweetheart training and startup programs funding by the federal govt that pad theses ATA carriers with extra $$$……. But keep your thinking cap on tight!! I liked what you said!!

  • donnisl

    NO DRIVER SHORTAGE…there is a PAY shortage. that is all. and bullshit to all these ‘company owners’ on here who say they can’t afford to pay more….i’ve been trucking over 30 years,hourly now,$70,000+at the end of this year,so blow that out yer pooper owners…if ya pay a decent wage,drivers will be fighting each other in your lot to drive for you.we have drivers making over $100,000. no bull. teamsters rule.

  • donnisl

    no driver should have to work 84 hours a week to make a living.i work 45 hours a week,sometimes more,sometimes less,i average $1200.00 to $1500.00 a week gross pay. that is what 30+ year drivers should all be making. these companies are silly with their “driver shortage” claims…
    simply a pay shortage.

  • Jimmy the Greek

    the chosin people want to kill off the white race , we are to hard to control .

  • guest

    11.50 an hour is way too LOW for local pay…18-22 is more realistic for a Professional 18 wheeler driver. His company is ripping him OFF.

  • guest

    Sure if this CRAP was happening in Kevin’s office he would be the first to complain..BUT since it is only happening to US…not a peep out of kevin…only cheerleading for more Foreign DOPES coming in here and stealing whatever they can get ther hands on…Government sucking up the WEALTHY to provide CHEAP Foreign LABOR.

  • g

    That is the Gospel right there Tall Paul!!
    Those CROOKS at ATA are a Total Rip OFF.

  • g

    NOPE..most Dont care at all. They only want to suck up more MONEY for themselves.
    They dont get paid to CARE…..dont expect it coz you aint gonna see it….

  • ron s

    drivers should get paid by the hour….on duty….sitting at a warehouse waiting to be called to the door, yes, it should be by the hours…let the business community absorb the cost instead of using the truck driver…..

  • Mean on Sunday

    Let’s be like government workers, they get fer lowed during the government shut down then get all back pay in the “deal” congress makes. Sounds like paid vacation time to me.

  • BunniRabbyt

    what is wrong in getting paid by the hour what is wrong with shutting down strictly over unfair labor practice. If you guys dont get together and just sit around and gripe it is just more doomesday for you. Grow a set or shut up. Me I am retired but I did go thru 3 shutdowns inthe past 42 years . Today I think the ball is in your court you need to take a shot at it.

  • Keith E Guiste

    $50 an hour? you are INSANE

  • Del Ray Johnson

    I know INSANE you keeping working for peanuts while making trucking companies rich. It is obvious to me you are clueless and this is the reason why mark my words the “man” is going to pay you clowns $3 per hour. Here is a novel thought if the Yellow truck company pays 40CPM why does any driver CONTINUE to work for the Red company paid 25CPM?

  • Craig Vecellio

    They used Walmart as the example….which pays its’ drivers so well that other employees complain the drivers are overpaid…this is not comparable to the rest of the industry. 78k per year is 1500 per week, even after hometime. Who makes that as a company driver? Few owner ops even make that. And they claim the driver’s spending power is only 10% less than it was in 1990…how does that work when drivers are averaging 30k per year less than they were then (except of course for Walmart drivers)?

    The hourly pay schedule needs to take into account involuntary downtime. Compared to an hourly day driver, who is home every night and weekend, the OTR driver has a 14 hour workday, 7 days per week while out. That’s a 98 hour work week. The HOS regs of 70/8 come out to 61.25 hours per 7 day week on a rolling cycle. If you assume the driver has one hour per day in VOLUNTARY downtime for breaks, that’s 29.75 hours per week of involuntary downtime spent on line 1 or 2. It looks like ‘time off’ in the logbook, but you are still held to that truck. This includes time waiting to load, unload, waiting on dispatch for a load, or resetting your hours at a truckstop if you run out in the middle of nowhere. THAT is the time that needs to be accounted for in an hourly wage; all time spent away from home, including involuntary downtime. Get us home or pay us to sit somewhere and wait. Hourly drivers make about the same annually, but that’s because they spend fewer hours with the truck, not because the pay schedules are about the same.