The Obama Administration's proposal to reauthorize federal infrastructure programs for the next four years contains language requiring trucking firms to pay drivers for on-duty time not spent driving, a move by the White House to address the financial impact on drivers who are delayed for hours at port terminals and shipping docks waiting to load or unload cargo.
The provision, contained in a 350-page proposal unveiled yesterday, would require truckers to pay drivers an hourly rate no less than the current federal minimum wage for "any on-duty, not driving period." The provision would apply to drivers who aren't paid under an hourly wage scale; over-the-road and drayage drivers are generally paid by the number of miles driven. It would exclude drivers covered by an existing collective-bargaining agreement that already compensates a driver for on-duty, nondriving time.
The language would appear to be targeted at independent owner-operators, which represent the bulk of the nation's truck fleet and today handle most of the drayage around U.S. seaport complexes. Owner-operators have complained ferociously in recent years about very long wait times at port terminals and shipping docks. The problem has been amplified by last year's changes to driver "hours of service" regulations, which reduced a driver's maximum workweek to 70 hours from 82, thus narrowing a driver's time frame to generate income.
However, the provision is written in such a way as to only cover the relationship between a motor carrier and an employee. It does not refer to owner-operators at all. Norita Taylor, a spokeswoman for the Owner-Operators Independent Drivers Association (OOIDA), said the group is aware of how the language was structured.
Most independent drivers in the United States actually work under long-term lease agreements with trucking firms, though they are not employees. About 92 percent of the nation's truck fleet is comprised of companies that own six trucks or less.
Shipper-carrier contracts generally allow a specified amount of "free" waiting time—often two to four hours—before detention charges are assessed. Charles W. Clowdis, Jr., managing director, global trade & transportation, for consultancy IHS Global Insight, said some of the upper-tier carriers will share the cost of driver detention costs with their drivers.
Anne S. Ferro, head of the Federal Motor Carrier Safety Administration (FMCSA), a subagency of the Department of Transportation that oversees truck safety, has pushed hard to move the issue up the legislative priority list. Ferro's interest may have been sparked by her experiences during a two-day ride-along late last year with an owner-operator travelling from Maryland to Missouri. Writing in her blog upon her return, Ferro said that drivers arriving to pick up a load are often kept waiting for hours at a dock, and then must spend additional time securing the load aboard the vehicle. That time counts against their workday, yet they are not paid for it because the truck is idle.
"Imagine your own frustration if you had a limited window for earning revenue, but control of that window was in someone else's hands," Ferro wrote.
In a DOT statement yesterday announcing the Administration's proposal, Ferro said the provision "will ensure fair pay for long-distance...truck drivers who are often paid by the miles they travel, not their total time on-duty, and [who] face economic pressure to jeopardize safety by driving beyond the mandatory limits."
In a statement yesterday, OOIDA President and CEO Jim Johnston urged Congress to "follow through with the Administration's recognition of the connection between highway safety and driver pay by making sure that all truck drivers are compensated for all of their on-duty time."
The American Trucking Associations, which represents mostly large trucking firms, called the compensation model a "one-size-fits-all" approach that is a poor fit for a very diverse industry. Bruce Carlton, president of the National Industrial Transportation League, a group of large, mostly industrial shippers, said in an email that while the entire supply chain should be concerned about the impact of detention times on driver wages, the solutions should come from the marketplace and not from lawmakers or regulators.
"Current law on wages and hours of work is well established, and I don't believe trucking companies will warmly receive this proposed federal intervention in this fundamental element of the labor/management relationship," Carlton said.
The Administration has proposed a $302 billion initiative to fund the nation's surface transport programs. About $150 billion of the funding would come from changes to inventory accounting rules, tax incentives for U.S.-based firms to repatriate up to $2 trillion in overseas earnings, an end to the 58-year-old ban on states tolling existing interstate highways, and an increased reliance on private sector financing. The balance would come from the current mechanism of excise taxes on motor fuels consumption.
The bill, called the "Grow America Act," includes $10 billion over four years to fund improvements to the nation's freight network. The bill would direct the Secretary of Transportation to award grants to public-private sector projects designed to improve the safe and efficient movement of freight.
This marks the first time the Obama Administration has submitted its own proposal to reauthorize funding for the nation's transportation network.