News
Time ticking on HOS ‘grace period’
Carriers and shippers are unsure how the Federal Motor Carrier Safety Administration’s new hours-of-service rule will change their operations; meanwhile, everyone is still trying to grasp the ‘federal speak’ of it all.

Carriers in recent weeks have said they’ll collect detention charges, called “behavior-based” pricing by some, increase driver pay and haul only “friendly freight” — all in an effort to decrease time drivers spend loading and unloading so that productivity losses might also decrease under the new hours-of-service rules.

Meanwhile, since late December, FMCSA has received 5,500 calls from truckers and others about the new rules — all this while national enforcement appeared to vary as the first month of a two-month educational period came to a close.

For example, one Alaska-based OOIDA member told Land Line, “no one is telling the scale masters” that state exemptions allowing longer periods of drive time will no longer apply under the new HOS rules. Alaska and Nebraska have said they’ll need more time to interpret the new regulations.

Most driver calls to FMCSA, 18 percent, concern the 34-hour restart period. Another 16 percent want to know more about the sleeper berth provision. Nine percent have asked about the 60/70-hour work week change, and 5 percent called about record keeping, the FMCSA said.

The remaining calls include questions specific to unique driving situations, questions on the difference between drive time and duty time, and inquiries into the use of electronic on-board recorders.

Moreover, many drivers feel they’ve been left in the lurch and won’t benefit significantly even if shippers and carriers begin to iron out their differences. Other drivers are just plain frustrated because unraveling the rules’ finer points is akin to un-twirling a dry pretzel.

OOIDA member Spence Denning, Sparta, TN, a driver for more than 30 years, said, “The bureaucrats in order to once again cater to a special interest group have created a totally dysfunctional new hours-of-service policy … This thing has so many vague areas, even the people who are supposed to enforce it don’t think it will fly.”

Other OOIDA members say recent pay increases don’t approach the level drivers need to make a living. After all the HOS hoopla dies down, so will pay, they fear. And many doubt they’ll benefit from detention charges, even if carriers actually get the money from shippers.

‘Friendly freight’
John Siebert, research project leader at the OOIDA Foundation, said it was clear from conference discussions he attended at a recent Transportation Research Board meeting in Washington, DC, that carriers are looking at customer freight characteristics as a way to determine the monetary impact of the HOS rules.

The long and short of it — carriers probably will begin to haul only what they call “friendly freight.”

For example, Schneider officials discussed a model of the new HOS rules they applied to grocery warehouses.

“The model fell apart — their current freight rate couldn’t sustain a whole week, so they had to find a new rate that would work,” Siebert said. “But when they finally found a rate where they made money, with all that wait time, it was a rate no shipper would pay. Shippers offer freight at 82 cents a mile, but using the model, Schneider would have had to double or triple that amount to earn a profit, so they just aren’t going to haul that kind of freight.”

One OOIDA member wrote to Land Line: “I am sincerely happy to hear that a company as big as Schneider is going to quit hauling ‘unfriendly freight.’ Let all the companies quit hauling freight that cannot be unloaded or loaded in a timely manner.

“No better place than the food industry to start to send the message that we are not going to sit at any docks and not get paid for it. Once the effect hits the shelves, maybe someone will open their eyes.”

Behavior-based pricing
At the TRB meeting, J.B. Hunt said it’s developing “behavior-based” pricing to encourage shippers to limit driver wait time to one hour.

Carriers like Hunt say dock delays directly reduce a trucker’s driving time. Metro-area driving, delays in loading or unloading, multiple stop-offs and border crossings are all thorns in the carriers’ bottom line that contribute to increased operational costs.

“It’s become clear to carriers they can’t keep doing business as usual because the 14-hour rule can’t be fudged,” Siebert said.

“You’ve got to be off 10 hours before you can start driving again — and that’s a functional change that carriers say will result in 4 to 9 percent less efficiency. After a driver starts working, he can drive for 11 of the next 14 hours, but ‘off-duty’ activities no longer stop that 14-hour clock,” Siebert added.

During a session titled “Opportunity in a Changing Marketplace,” Gary Whicker, Hunt’s vice president of safety services said, “Our formula is that good behavior equals a lower price for our customers. We are adding extra charges for wait time, driver loading/unloading, etc., as a way to show our customers where the real cost is ... That way, if they modify their practices to better fit our needs, they get a lower price.”

Meanwhile, other companies are taking the direct approach.

On Jan. 4, 2004, the first day of new hours-of-service rules, Navajo Shippers Inc., Commerce City, CO, charged customers a $100-an-hour penalty for trucks waiting at the loading dock for more than one hour, according to press reports.

The company assessed penalties of $66,000, said Vice President Don Digby Jr. Navajo operates in the lower 48 states but mainly Colorado and the West Coast.

“We’re going to bill for everything that we do,” Digby said. “Every time our drivers and trucks are sitting there, someone’s going to pay.”

However, Digby didn’t discuss the shippers’ reaction to the fines.

— by Dick Larsen, senior editor

Dick Larsen can be reached at dick_larsen@landlinemag.com.

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