June 15, 2021
As the world is opening up for business again, most industries are struggling to get staff fully staffed. Restaurants, retail, labor, and even fast food are finding it difficult to fill open positions. In some cases, restaurants are even having to reduce hours to keep up with the business while they are desperate to find employees.
The situation no surprise to the trucking industry. It’s a situation they are quite familiar with and means they are right back to where they were before the pandemic—in a driver shortage. The demand for drivers has not been alleviated, if anything, it has gotten worse which is why some companies are looking to increase wages and develop innovative ways to increase both driver retention and attraction. Some fleets are even offering guaranteed weekly pay.
For over-the-road truckers, getting paid by the mile is how it’s always been so, increasing the dollar per mile is what they look for. However, change is not always a bad thing. Driving for a fleet with non-traditional pay models might alleviate the stress level of pay per mile models and attract drivers wanting a more stable situation.
One of our goals is to take some of the stress out of our drivers’ week due to the unknowns, like time getting loaded/empty or countless other unexpected things that can happen, said Chris Kelley, vice president of operations for Big G Express, a truckload carrier based in Shelbyville, Tenn. Big G in February announced a $1,000 per week minimum pay program.
The trend of an hourly-based pay model also addresses the cost of detention, which is all about time. Hourly pay suits local hauler John McGee Trucking. His Simsboro, Louisiana-based fleet serves the oil and gas industry with the majority of his hauls within 60 miles of the shop. Hourly pay also makes sense for McGee because the oil and gas industry pays him by the hour, including detention which means customers are eager to load and unload quickly.
Small fleet owner Brian Lindley out of Alabama opted for a salary structure to offer income predictability for drivers on dedicated accounts. Given hours of service limitations, drivers did not always get consistent shift work. Offering predictable weekly income was a way to balance it out and demonstrate a positive culture and commitment from the company.
Carriers using or considering hourly pay and guaranteed pay don’t all have the same approach.
Central Oregon Truck Co., a Redmond, Oregon-based flatbed carrier uses a salary pay model. Its website promises drivers weekly salary pay ranging from $1,350 to $2,150” and suggests that the top 10% of solo drivers can earn up to or over $89,000/year.
Billerica, Massachusetts-based Boyle Transportation, has implemented a guaranteed pay program that is not salary-based. The company specifies that regional drivers, on a five-day-a-week schedule, earn from $1,395 per driver weekly for up to two years of experience, topping out at $1,575 for at least eight years.
While the hourly salary is attractive to many drivers, it has not been implemented by very many fleets. In a survey of Overdrive and Commercial Carrier Journal readers, only 6% of owners of fleets with two to 30 trucks said they use a minimum guaranteed pay model for company drivers.
Jennifer Kuntz, President of D&D Trucking and Transportation out of Gooding, Idaho said she looked at an hourly model but it just didn’t make sense for the company.
We looked at it hard and debated the pros and cons of guaranteed weekly pay but chose to increase the mileage pay instead.
We anticipate that all drivers will log a minimum of 2800 miles per week with some even rolling at 3500 a week. Even our regional drivers can turn and burn that mileage weekly. With our new pay, it averages between 1400 to 1785, plus billable detention, layover pay if it occurs as well as stop and picks charges. —Jennifer Kuntz, D&D tsi
Jennifer went on to say that they were close to changing our pay to a guaranteed weekly pay but decided on the increase in mileage at a top pay structure. The pay increase was on average a 20% to 30% increase in our driver wage. She said they also had long conversations with customers, who ensured a guaranteed dedicated business, meaning a driver is guaranteed to run that lane to and from every week for guaranteed mileage weekly. The company also made it a priority to hold operations accountable for setting workable appointment times while maintaining clear communications and building relationships with clients to ensure the model would work for everyone.
We are all in this business together and work to ensure that our drivers get the miles they need. Jennifer Kuntz, President D&D tsi
By creating consistency in the routes and lanes enables the driver to build a relationship with the shipping and receiving as well as the local communities that they engage with every week.
Along with the top mileage pay increase, D&D tsi generously contributing to health insurance, 401k, breakdown pay, shuttle pay, vacation pay. The company cares about the culture so building relationship with both the D&D teams and the customers, is a priority.” If your priority is people, the profit will follow,” says Kuntz. She goes onto say that, “we work hard to foster an environment that is right for our employees and when we see it leaning negative, we address it as quickly as we can”.
I’m proud of our drivers and our employees. I’m proud that I still have drivers 20 years later that retired and still come in weekly to visit. I have employees who call retired drivers to this day, to check on them and be sure they are doing okay. We truly are a united family. —Jennifer Kuntz, President D&D tsi
Overdrive online put it best by suggesting that just because some fleets are having success with the newer salaried or hourly pay model, doesn’t mean they are better than the traditional pay-per-mile.
I think the misconception is per-mile pay equals bad pay. We don’t see that in the data. For the first time in the Best Fleets program history, the average annual compensation this year exceeded $70,000. That can include bonuses and pandemic-related payments”. — Chris Henry, vice president of customer experience and recognition programs for Carriers Edge, which produces the Best Fleets program for TCA.
What the trend does indicate is that truck drivers are critical and efforts to hire and keep them have been elevated. Whether they are paid hourly or per mile, truck drivers also deserve a positive culture and responsive leadership that cares about the obstacles and the challenges truck drivers are faced with every day. The trend shows that to be the case with hourly increases, mileage increases, and a higher annual income.
As of May, Teamster drivers averaged $28.26 an hour, a little under $59,000 a year, according to the ZipRecruiter employment website. The median earnings for drivers of heavy-duty trucks was $47,130 a year ago, says the U.S. Bureau of Labor Statistics. A flurry of driver pay hike announcements in this year’s high-demand market should significantly boost that average. — Overdrive online
If you are a truck driver looking for consistent work and great work culture, D&D trucking could be the perfect fit. If you are an experienced over-the-road driver (5 years +), certified, and verifiable, you will receive up to ¢.51 per mile. New hires with at least 2 years of experience will receive ¢.47 per mile with a ¢.01 increase after 60 days, and an additional ¢.01 increase after 90 days.