Carriers continue to try to entice drivers with higher pay, but delays caused by supply chain bottlenecks that show no signs of abating may erode those advantages.
While there is no standard definition of “extreme detention” in the trucking sector, the American Transportation Research Institute (ATRI) points out that any more than two hours delays are considered excessive.
According to the American Trucking Associations, where carriers can negotiate reimbursement for shipper-caused delays, it is usual for delay charges to accrue after two hours at the customer’s facility. However, because transportation is so competitive, many carriers cannot pass detention-time expenses on to their customers, according to the ATA.
Increasingly long wait times
Average wait times for some of the essential truck-centric industries have been hovering around two hours since June. According to data provided by FreightWaves, these wait times have now surpassed two and a half hours (see chart).
“Wait times worsened in the first and second quarters, stayed the same through the middle of the third quarter, but they’re starting to climb again as we approach peak season,” said Kevin Nadeau, Founder, and CEO of True Load Time, a web-based application designed to address truckload detention and inefficient loading and unloading.
With port congestion continuing to spill over onto the supply chain’s surface transportation linkages, truckers’ pay increases may begin to erode and may continue to do so for months.
According to Lewie Pugh, vice president of the Owner-Operator Independent Drivers Association, “what used to take two hours to load or unload is now taking four or even six hours.” “The trucking firms may be increasing compensation by 5 cents per mile, but if I’m sitting at an unloading dock for the majority of my day, that’s not going to help me.” There’s little doubt that the longer supply chain wait times are compensating for salary increases.”
Due to growing congestion along the supply chain, shippers and warehouses have extended the hours after detention is paid, according to Desiree Wood, an independent owner-operator and president of the advocacy group REAL Women in Trucking.
“It used to be two hours,” Wood told FreightWaves, “but now it’s three hours, and sometimes even four hours.” “And when the facility eventually begins to pay, the money frequently does not reach the driver.”
However, according to Steve DeHaan, President of the International Warehouse and Logistics Association, which represents third-party logistics companies that serve several customers at a single location, higher wait times are frequently not the responsibility of warehouse facilities or shippers.
DeHaan told FreightWaves, “If you’re a truck driver and you’re given a set dock time, you have to meet it.” “If you arrive early, our members will typically take you for loading or unloading as soon as they have availability, but if you arrive late, you will have to wait for an opening,” he added, adding that with current supply chain backups, this could be a more significant issue.
Wages are decreasing.
According to a pre-pandemic study conducted by the U.S. Department of Transportation’s Office of Inspector General (OIG), detention time was estimated to reduce drivers’ annual earnings collectively by $1.1 billion to $1.3 billion and between $1,281 and $1,534 per driver. The average yearly salary of a driver was reduced by 3% to 3.6 percent due to this.
According to the ATA, some of this loss is compensated by carriers charging shippers detention fees and then paying their drivers a share of the money recovered.
“On the other hand … our estimates may understate the loss of income faced by drivers and carriers because small carriers report experiencing detention more frequently than larger carriers and receiving compensation from shippers less frequently,” according to the OIG report.
The compensation issue, according to Pugh, could be remedied if Congress removed an exemption from the Fair Labor Standards Act. The exemption was enacted in 1935 to prevent drivers from working too many hours. However, Pugh and the OOIDA have contended that the regulation has become a justification for poor driver compensation.
“If you remove the exemption, carriers will have to start paying them for their time — including when drivers are sitting idle at a shipper or a receiver,” he said, adding that it would also improve safety. “If you’re paid by the hour instead of by the mile, you don’t have to make up pay by speeding through work zones or pushing past hours-of-service limits because of this ‘beat-the-clock mentality.”
Is there a possibility of government intervention in the future?
While there currently is no push in Congress to make changes to the FLSA, buried in the 2,700-page bipartisan infrastructure legislation is a provision that directs the Federal Motor Carrier Safety Administration to contract with the Transportation Research Board to conduct a study of the impacts of various methods of driver compensation on safety and driver retention, including looking at hourly pay and payment for detention time.
In addition, the FMCSA itself initiated in 2019 a formal Request for Information on truck driver detention times that occurred during loading and unloading.
The request received close to 600 comments. Some commenters, including the ATA, questioned whether FMCSA had the authority to regulate a market-based problem with insufficient evidence to show that safety is affected.
It may be a moot point, as sources at DOT told FreightWaves that FMCSA is not likely to move ahead on the issue anytime soon.
“We keep trying to attract drivers by bumping up pay, but at the end of the day, truckers just want to drive,” Nadeau said. “We want drivers to be efficient and maximize the hours they have available to drive, and if we can get a handle on that, this industry will be much more attractive. A lower pay rate per mile can be equal to a higher rate if turn-times are reduced from a compensation standpoint. Truckers want to be able to make money that compensates them for their time and allows them to be home on the weekends.”
