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State CDL agencies get reprieve from drug & alcohol clearinghouse deadline 12/16/2019 Friday Short Haul - JB Hunt's Wreaths Across America, Plus.ai butter run, states look for zero emissions 12/13/2019 Carriers muster to pick up Celadon drivers, employees 12/11/2019 Will Amazon's pay-per-day plan influence the industry? 11/27/2019 Freight volume and rates downturn turns into a 'bloodbath' 11/25/2019 Friday Short Haul - Independent contractors getting booted out of CA, winter weather resources, ransomware attack 11/22/2019 Knowing when to say goodbye to an unprofitable shipper 11/20/2019 Schneider donates trucks; Congress considers women-driver-friendly bill 11/18/2019 Friday Short Haul - CTA files lawsuit against California, Highway Hero nominations sought, video of "Move Over" crash 11/15/2019 Tesla announces new electric Semi model 11/13/2019 Not everyone happy with potential FMCSA clearinghouse delay 11/11/2019 Friday Short Haul - AI taking driving jobs, CRV scam, Truckers protest AB-5, ELDs quit working 11/8/2019 Investigators cracking down on truck accident fraudulent lawsuits 11/6/2019 So you want to start your own trucking company? 11/4/2019 Friday Short Haul - FMCSA emergency exemptions, snow plows, FedEx employee bribery charges 11/1/2019 Human smuggling via big rigs on the increase 10/30/2019 Carriers, drivers look at ways to deal with California's AB-5 10/28/2019 Friday Short Haul - Millennials and trucking, Truckers Christmas Group, Navistar settlement 10/25/2019 Too many drivers still don't know to "Move Over" 10/23/2019 Are trucker strikes a thing of the past? 10/21/2019 Friday Short Haul - Passenger car drivers, spotted lanternfly, women drivers 10/18/2019 OOIDA makes final push for better HOS rules 10/16/2019 Car-truck crash fatalities continue to increase 10/14/2019 Friday Short Haul - Amazon's fleet of day cabs, legislator's disclosure, WTA petition 10/11/2019 ATA chief takes on truck-accident lawyers 10/9/2019 Lonely on the road? Get a furry friend 10/7/2019 Friday Short Haul - Lab-grown meat, fraudulent freight brokering, FMCSA HOS committee, FMCSA Clearinghouse 10/4/2019 UPS takes giant leap in its drone delivery program 10/2/2019 Female drivers are safer bet for trucking companies 9/30/2019 Friday Short Haul - Embark gets financing, FMCSA announces safety grants, Covenant exits Mexico routes, and trucking statistics 9/27/2019 Emissions standards battle heats up between the EPA and California 9/25/2019 Smog checks in the future for California truck drivers 9/23/2019 Friday Short Haul - Volvo Dynamic Steering, Meals for 18 Wheels, speeding crackdown, OOIDA opposes legislation 9/20/2019 Telematics could be insurance-premium-saving boon for fleets 9/18/2019 54 percent of survey respondents still not impressed with telematics technology 9/16/2019 Friday Short Haul - Walmart video, it's churn, not shortage, California's independent contractor bill, hemp drivers plea 9/13/2019 TCA honors three Highway Angels 9/11/2019 Now they're talking about "smart" trailers 9/9/2019 Friday Short Haul - Detention-time comments, truck orders decline, diesel fuel shortage 9/6/2019 Berkeley study says reducing independent truckers can alleviate climate change 9/4/2019 Clearing up concerns about the drug and alcohol clearinghouse 9/2/2019 Friday Short Haul - Hurricane Dorian, Speed limiter bill, Thank a Driver campaign 8/30/2019 Georgia jury awards $280 million for truck-driver-caused multi-fatality 8/28/2019 Friday Short Haul - New eCascadias, Top cities for truck driver jobs, Push against driverless trucks 8/23/2019 Decision on California drivers' employee/contractor status coming down to the wire 8/21/2019 UPS jumps on autonomous bandwagon with TuSimple investment 8/19/2019 FMCSA publishes proposed HOS rule changes 8/16/2019 Fleets, drivers coming to like automated manual transmissions 8/14/2019 CVSA asks for new truck crash study 8/12/2019 Friday Short Haul - HOS revisions delayed, AEB mandate proposed, Koch sued for sex discrimination 8/9/2019 Kodiak Robotics takes lead in autonomous truck industry race 8/7/2019 New York City combats rash of cyclist/truck clashes 8/5/2019 Friday Short Haul - CRST wins lawsuit, OOIDA opposes insurance hike, UPSNav 8/2/2019 Mechanics shortage equals driver shortage in intensity 7/31/2019 DOT announces almost 1$ billion in grants to fix infrastructure 7/29/2019 Friday Short Haul - DOL on sleeper pay, UPS drone delivery, Geowiz ELDs 7/26/2019 FMCSA takes a look at assault, harassment of female and minority drivers 7/24/2019 It's hot out there, what's a trucker to do? Can't idle. 7/22/2019 Friday Short Haul - Utah truck rollovers, aging truckers, lifetime CDL bans 7/19/2019 Truck-mounted LED billboards coming under fire 7/17/2019 Trucker 'drones on' with unique approach to teaching driving skills 7/15/2019 Friday Short Haul - Rhode Island tolls, human smuggling, contractor vs employee status 7/12/2019 ELD mandate deadline looming, many still not compliant 7/10/2019 New "boot" device being deployed to threaten Walmart overnighters 7/8/2019 Friday Short Haul - Prime Inc vs Amazon, mother fights HOS changes, truck drivers appreciation week 7/5/2019 Proper way to fly the American flag on your truck this Fourth of July 7/3/2019 Roundabouts are becoming popular; but are they best for trucks? 7/1/2019 Friday Short Haul - Skills test proposal, driver shortage, hemp sentencing, driverless trucks 6/28/2019 Experts warn of active wildland fire season 6/26/2019 More states signing on to enlist truckers against human trafficking 6/24/2019 Friday Short Haul - Shippers of Choice, insurance rates, wheel spikes, WIT award 6/21/2019 Freight numbers not holding up to 2018's highs 6/19/2019 Truck safety group urges purges of drug abuse drivers 6/17/2019 Friday Short Haul - Self-driving certificate, truck platooning, trade war stacking up cargo 6/14/2019 HOS waiver coming soon for fireworks haulers 6/12/2019 FMCSA takes a further look at detention time 6/10/2019 Friday Short Haul - Autonomous delivery, HOS rules changes, CDL retest 6/7/2019 Roadcheck 2019 in effect this week 6/5/2019 Hemp arrest prompts USDA memo 6/3/2019 Friday Short Haul - Waymo big rigs, Move over sting, Under-21 comments 5/31/2019 Severe weather prompts renewed emergency declaration 5/29/2019 Memorial Day holiday is prime time for cargo thefts 5/25/2019 Friday Short Haul - Hauling hemp, road rage fatality, new rules for autonomous vehicles 5/24/2019 Autonomous trucks on USPS test run 5/22/2019 Future era of cab-less trucks will be the end of HOS rules 5/20/2019 Friday Short Haul - FMCSA under-21 comments, Tesla autonomous car crash, 24,000 drivers sign contract with YRC 5/17/2019 Under-21 interstate drivers getting serious look by FMCSA 5/15/2019 Trucker Buddy program matches drivers with a classroom; everyone wins 5/13/2019 Friday Short Haul - Driver awarded $80 million, ODFL driver wins, loading dock black hole 5/10/2019 Storm breaks out from Rockies, slams into Midwest, South 5/8/2019 Capacity issues have shippers looking at private fleets 5/6/2019 Friday Short Haul - HOS rules, dark skies, Falcon drivers 5/3/2019 'Bug' permits now required for four eastern states 5/1/2019 Simulator use is catching on for schools, carriers 4/29/2019 Friday Short Haul - Thinking electric, Penske opens charging station, border crossing crisis, railroads taking trucking business 4/26/2019 ELDs might not be the panacea that was hoped for 4/24/2019 Truck drivers may soon see "phantoms" driving yard trucks 4/22/2019 Friday Short Haul - Nikola big rigs, WIT welcomes Peterbilt, Oregon crashes, Border crossings 4/19/2019 Carriers claim financial benefit of putting up drivers in hotels 4/17/2019 Uber's IPO application reveals interesting data about its freight brokerage business 4/15/2019 Friday Short Haul - CDL examiner arrested, tolls proposed for trucks, marijuana use on the rise 4/12/2019 Smart Load Board will get carriers the loads they need 4/10/2019 Huge lines and long wait times greet carriers at Mexico border 4/8/2019 Friday Short Haul - Marijuana, ATA campaign, personal conveyance rules 4/5/2019 Over-the-air downloads revolutionize parameter updates 4/3/2019 Don't get scammed by skimmers 4/1/2019 Friday Short Haul -- New Cascadias honored, motorist survey, U.S, Xpress awarded, rest stop parking 3/29/2019 Legislators address underride collisions, propose more underguards for trucks, trailers 3/27/2019 Motorists soon may encounter a different kind of truck convoy 3/25/2019 Friday Short Haul -- Women in Trucking, irate motorist, FMCSA eases HOS, Safe-Cap 3/22/2019 Recent survey shows cost of roadside repairs is rising 3/20/2019 FMCSA announces drug and alcohol clearinghouse website 3/18/2019 Friday Short Haul - Swift settlement, driver shortage myth, TCA Best Fleet award 3/15/2019 The hidden danger of looking but not seeing 3/13/2019 Accident scammers target trucks for financial payout 3/11/2019 Friday Short Haul - Snow on the roof, bypassing toll road, Waze under fire 3/8/2019 Retailers blame driver shortage for price increases 3/6/2019 Drivers' smartphones may be clue to road roughness 3/4/2019 Friday Short Haul -- Freight rates, HOS changes, tonnage reports 3/1/2019 New tax changes hit drivers hard 2/27/2019 FMCSA to implement under-21 interstate driver program for former military 2/25/2019 Friday Short Haul -- Connecticut tolls proposed, hydrogen fuel-cell trucks, cell phone use 2/22/2019 Congress committee looks at state of America's highways 2/20/2019 Number of cargo thefts is down; but dollar value about the same 2/18/2019 Friday Short Haul -- Crossing the border, CA sues FMCSA, Lobbying against larger trucks 2/15/2019 Detention - A problem still in search of a solution 2/13/2019 February Highway Angels honorees named 2/11/2019 Friday Short Haul -- C.R. England announces pay raises, eCommerce impact on trucking, TCA announces best fleets 2/8/2019 Is a guaranteed minimum pay the solution to the driver shortage? 2/6/2019 Long CDL testing wait times cost economy billions of dollars; not helping driver shortage 2/4/2019 Friday Short Haul -- Walmart hiring, Uber Freight App, Speed-limiter Law, America's Road Team 2/1/2019 Cranking -- The Good, The Bad, and the Ugly 1/30/2019 California survives challenge to its low-carbon fuel standards 1/28/2019 Friday Short Haul - Highway robbery ... autonomous trucks ... new trailers 1/25/2019 LithiumHub enters jump-starter market with Jumpbooster JP30 1/23/2019 2019 Looks Good For The Transportation Industry 1/21/2019 Raymond Burt named TMC Trainer of the Month for February 2018 3/28/2018 TMC Transportation Announces Recipient of Prestigious Wheel Master Award 3/7/2018 TMC Transportation Named The Home Depot’s Flatbed Carrier of the Year For Fourth Straight Year 2/28/2018 Pay Raises & New Peterbilts for PAM Drivers 2/26/2018 New DOT Drug Testing Rules Effective Jan 1, 2018 1/11/2018 Amtrak Derailment: Trucks Haul 270,000 Pound Locomotive Engine During Cleanup 12/21/2017 Pepsi Places Largest Order Yet For Tesla Electric Trucks 12/12/2017 Kavin Hallett named Trainer of the Month for October 2017 12/8/2017 Over 100,000 Truck Drivers Likely Have Undiagnosed Sleep Apnea And More Testing Is On The Way 8/10/2017 Drivers Share Their Best Tips, Tricks, And Secrets For Life On The Road 7/18/2017 Drivers Are Losing Money By Taking The Wrong Approach 7/13/2017 Truckers and Guns: What Is and Is Not Legal 7/6/2017 Preparing To Go Solo For The First Time? Experienced Drivers Share Their Best Advice 6/29/2017 The Truck Stop Survival Guide: Advice From Experienced Drivers 6/15/2017 The Worst Cities For Traffic In The U.S. For 2017 6/8/2017 We Ask Drivers How They Would Make The Logbook Rules Better 5/30/2017 Self Driving Trucks Are Not Coming Anytime Soon 5/25/2017 11/30/-0001

Is a guaranteed minimum pay the solution to the driver shortage?

Dave Wickenhauser on Wed, February 6, 2019

Last Updated: Tue, February 5, 2019

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In the ongoing effort to alleviate the driver shortage trucking companies are beginning to consider a new strategy to entice new drivers – they are taking a hard look at their reasoning behind sign-on bonuses. They are asking whether they should ditch them entirely in favor of offering guaranteed pay.

This article examines this new train of thought, and takes a look at some of the problems that drivers say they have with the existing sign-on bonus programs.

The sign-on bonus

Traditionally the sign-on bonus has been a factor that many prospective drivers consider in starting a driving career and in picking their first company to drive for. And it's also a consideration for current drivers who are thinking about jumping ship and moving to another company.

But carriers are now recognizing that offering ever-larger sign-on bonuses comes with some unintended consequences. What they are finding is that these bonuses create an incentive for drivers to move from company to company – basically bonus shopping.

“Carriers throw sign-on bonuses at drivers like they’re candy, and they create a bit of a sugar high,” says Jeremy Reymer, CEO of DriverReach and a member of the American Trucking Associations’ Workforce Development Committee. “But that sugar high wears off.”

Reymer says that although carriers may successfully "poach drivers from other fleets" with their bonus offers, it creates a mentality in drivers to "to bounce around to continue grabbing sign-on bonuses."

Not all drivers are happy with bonus programs

Besides the "bounce effect" another problem being recognized about sign-on bonuses is that drivers -- new drivers especially – are increasingly finding the bonus payout process to be too complicated, and some are outright nearly fraudulent.

There are several complaints by drivers about sign-on bonus offerings:

  • The sign-on bonus is rarely the financial windfall for the driver that carrier company advertising gives the impression that it is. Trucking companies will stretch payment of the bonus over a period of time in drivers' paychecks, thus ensuring they will keep those drivers behind the wheel of their company trucks. If the driver leaves that company before the bonus payout is complete he or she forfeits the remainder of the bonus.
  • After drivers are lured to the company by the sign-on bonus they discover that payment of the bonus is tied to their driving safely. They find some of the bonus being stripped away as the result of anything requiring a notation in their safety record.
  • Some drivers have found their bonus tied in with their fuel/mileage usage.
  • In extreme, but not unheard-of, cases drivers are mistreated by employers who know that drivers will tolerate levels of abuse in order to maintain their lock on the bonus that they were promised.

Guaranteed minimum pay

Instead of bonuses, carriers are looking into offering drivers a guaranteed pay package; which would consist of a weekly minimum, but still reward drivers with pay for miles driven over the minimum.

Max Farrell, CEO and founder of WorkHound, a driver feedback platform, agrees. He says drivers tell them a predictable paycheck is more important than the occasional larger paycheck.

“Volatility in pay is polarizing,” he says. “On those weeks when drivers talk about low pay, they think ‘I could make more at McDonald’s and be home with my family’ or ‘I work for Uber'” and make just as much, he says.

In today's economy, and facing a seemingly unending driver shortage, carriers can not afford to lose potential new drivers to the non-trucking sector.

Toward that end DriverReach's Reymer says more fleets are moving to a guaranteed minimum pay package. Some 100 fleet companies use DriverReach's applicant tracking system, and about 25 percent of them are now on a guaranteed weekly pay program.

“You want to set drivers up to succeed,” he says. “If this week they make $1,200 and the next week they make $450 — they can’t live like that.”

Bonuses and pay raises are not alleviating the driver shortage

They just might be onto something with the idea of offering a guaranteed minimum pay. A recent Business Insider article reveals that large bonuses and increased driver pay have not had the positive effect on driver recruitment and retention that carriers had hoped for.

A survey by the National Transportation Institute found that of 519 trucking companies that were questioned some 85 percent reported that increasing wages had no effect on new-driver recruitment.

Business Insider reported also that pay is increasing across the trucking industry. Nearly half of truckers told Business Insider that their pay increased in 2018, more than four times that of 2017.

But despite increased pay and bonuses the driver shortage remains a problem. Industry leaders cite conditions that drivers must work and live under – days and weeks away from home, lack of exercise, nutritional issues, etc.

But spokespersons like Reymer think the solution is a guaranteed minimum pay.

“Where can we reconcile what’s in the best interest of the driver and what’s in the best interest of the fleet? If you have a guarantee that you never earn less than X but you’re also rewarded when you go above that — it makes so much sense. It fosters a mutual beneficial relationship between the driver and their employer,” he says.

Source: CCJ, Business Insider, Smart-Trucking

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