top challenges for trucking - nacds · important for some flatbed fleets and dry van. 1. factory...
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TopChallengesforTrucking
Presentedby:PrasadSharma
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GeneralEconomicThemes&TruckFreight
1.Consumerspendingdrivesasignificantamountofdryvan,dedicated,andtemperaturecontrolledtruckloadfreight.2.Housingstartsareimportantforsomeflatbedfleetsanddryvan.
1.Factoryoutputisquitesoft,whichimpactsLTLfleetsandmanyTLsectors(dryvan,tanktruck,flatbed).2.Energyproduction(frackwelldrilling)hashurtmanytanktruckandflatbedcarriers.3.Currentinventorycycleisabigdragonfreightvolumes.
TheGood/OK TheBad
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GeneralTruckingThemes
1. Truckfreightvolumesweakenedconsiderablythrough2015and2016YTD.Loadsfortherestofthisyearwillremainunevenbysector.
2. Combinationofmoretrucksandlacklusterdemandsoftenedcapacity.WhiletheindustryaddedsomeOTRcapacity(mainlysmallTLsandLTLs)in2015,tractorcountsremainwellbelowall-timehighs.Somesectorsareaddingtrailerstoboosttrailer-to-tractorratios.Expectcapacitytotightengoinginto2017asvolumesgraduallyimproveandtheELDmandategetscloser.
3. Combinationofpayhikesandoilfieldweaknesshelpedalittleintheshort-termwiththedrivershortage,butthisisnotthelong-termtrend.
4. Fleetscontinuetoseerisingcostsxfuel.Fleetsusedfuelsavingstopaydriversmore,replacetrucksandaddtrailers.
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TractorCountChanges
-3.1%
0.7%
-1.4%
-5%
-4%
-3%
-2%
-1%
0%
1%
2%
3%
4%
Truckload
2014
2015
2016YTDYOY
Source:ATA’sTruckingActivityReport
Slowing
Includescompanytractorsandindependentcontractors.2016dataisJanuarythroughJune.
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TruckDriverAgeDemographics
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TruckDriverAgeDemographics
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IC Model Under Fire
• U.S.DOLIC-StatusInterpretation(July15,2015)– AdvicememorandumfromtheWage&HourDivisionregardingIC-statusunderFLSA
– Graftedexpansiveviewof“sufferorpermittowork”(definitionofemploy)andfocusoneconomicdependence
– “Insum,mostworkersareemployeesundertheFLSA’s broaddefinitions.”
– Elevatesonefactor(whetherworkisintegralpartofemployer’sbusiness)overcontrolfactor(“the“control”factorshouldnotplayoversizedroleintheanalysis”)
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IC Model Under Fire
• DOLJointEmployerStatusInterpretation(Jan.2016)– AdvicememorandumfromtheWage&HourDivisionregardingJointEmployerstatusunderFLSA.
– Identifiesthe“corequestion”injointemploymentdeterminationsas“whethertheemployeeiseconomicallydependentonthepotentialjointemployerwho,viaanarrangementwiththeintermediaryemployer,isbenefittingfromthework.”
– CandidlydescribestheDOL’sintentiontoshiftFLSAliabilityupstreamto“largerandmoreestablished[businesses],withagreaterabilitytoimplementpolicyorsystemicchangestoensurecompliance.”
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IC Model Under Fire
• PresidentObama’sLaborDepartmenthasmaderootingoutallegedmisclassificationapriority
• MOUswith30states,includingIowa,toshareinformationandcoordinateenforcement(AL,AK,AR,CA,CO,CT,FL,HI,ID,IL,IA,KY,LA,MD,MA,MN,MO,MT,NH,NM,NY,OR,RI,SD,TX,UT,VT,WA,WI,WY)
• InFY2015,federalWHDinvestigationsledtorecoveryof$74millioninbackwages
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WageandHourClassActions
• ApplyingtobothemployeedriverandICdrivers(whogetreclassified)
• PrimarilyinCaliforniabutspreading;mealandrestbreakviolations,wagestatementviolations,howminimumwageiscalculated
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FMCSA RegulatoryAgendaSubject Status CommentsDue ComplianceDate
Entry-leveldrivertraining NPRM N/A(closedApril6)
3yearsfromfinalrule
ElectronicLoggingDevices(“ELDs”)
FinalRule N/A December18,2017;December16,2019(for AOBRreplacement)
CarrierSafetyFitnessDeterminations(“SFD”)
NPRM N/A(closed May23,2016(initial);June23,2016(reply))
90daysfollowingpublicationoffinalrule
DriverCoercion FinalRule N/A January29,2016
SleepApnea ANPRM N/A (closedJuly8,2016)
Unknown
Drug&AlcoholClearinghouse
ExpectedSoon
N/A N/A
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FMCSA RegulatoryAgendaSubject Status CommentsDue ComplianceDate
Heavy VehicleSpeedLimiters
ExpectedSoon
N/A N/A
Sanitary FoodTransportation
FinalRule N/A April2017/April2018(forsmallbusinesses)
Greenhouse Gas(Phase2) NPRM N/A (closedOctober1,2015)
Phased instartinginMY2018(fortrailers)andMY2021(fortractors)
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SafetyFitnessDeterminations• CurrentSafetyRatingProcess– Three-tierrating:Satisfactory,Conditional,Unsatisfactory
– Assignedfollowingon-site,comprehensivecompliancereview
– Basedonnumberof“acute”and“critical”violationsdiscoveredinsixbroadfactors:generalcompliance,driverfitness,hours-of-service,vehiclemaintenance,hazardousmaterials,andaccidentrate
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SafetyFitnessDeterminations(cont’d)
Factor RatingsOverallRating
Unsatisfactory Conditional
0 2orfewer Satisfactory
0 More than2 Conditional
1 2orfewer Conditional
1 Morethan2 Unsatisfactory
2ormore 0ormore Unsatisfactory
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SafetyFitnessDeterminations(cont’d)• CurrentSafetyRatingProcess– “Proposed”ratingfollowingreview– Administrativereview• 49C.F.R. 385.15(legalchallenges)• 49C.F.R. 385.17(upgraderequestbasedoncorrectiveactions)
• ProposedSafetyRatingProcess– One-tierrating:Unfit
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SafetyFitnessDeterminations(cont’d)• ProposedSafetyRatingProcess– Assignedoneofthreeways:
• Agencyinvestigations• On-roadsafetydata(i.e.,SMS)• Combinationinvestigation/on-roadsafetydata
– FMCSA’s justificationfornewmethodology• Currently,theagencycanonlyinvestigate17,000carriersperyearoutofapprox.525,000;1,000ofwhichresultinproposedUnsatisfactoryratings
• Newmethodologywouldexpandthereachandwouldresultinadditional2,000carriersperyearreceivingproposedUnfitratings
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SafetyFitnessDeterminations(cont’d)• ProposedSafetyRatingProcess– MonthlyassessmentofperformanceinthesevenBASICs– 2ormorefailedBASICs inagivenmonthresultsinproposedUnfitrating
– RoadsideBASICfailures• Only5ofthe7BASICs areevaluatedusingroadsidedata:unsafedriving,hours-of-service,driverfitness,vehiclemaintenance,andhazardousmaterials(crashindicatorandcontrolledsubstances/alcoholcomplianceisinvestigationonly)
• InordertofailaBASICusingroadsidedata,acarriermusthaveaminimumof11inspectionswithviolationsinagivenBASICina24-monthperiod
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SafetyFitnessDeterminations(cont’d)• ProposedSafetyRatingProcess– RoadsideBASICfailures• FMCSA proposes“absolutefailurestandards”forthe5BASICS;carrierswhoseSMS scoresexceedthestandardsinanyBASICwillfailthatBASIC• “Absolutefailurestandards”vs.interventionthresholds
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SafetyFitnessDeterminations(cont’d)• ProposedSafetyRatingProcess– RoadsideBASICfailures
• Absolutefailurestandardswillbesetbyrule(proposalistousestandardthatisequivalenttothe96th (UnsafeDrivingandHOSBASICS)and99th percentile(DriverFitness,VehicleMaintenance,andHMComplianceBASICS)
• BASICmeasure=sumoftime- andseverity-weightedviolationsdividedbytotaltimeweightofvehicleinspections
• SafetyEventGroups(numberofinspectionswithviolations)– FMCSA investigationfailures
• On-siteoroff-siteinvestigations• Asingle“acute”or“critical”violationinanyBASIC=failureofthatBASIC
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SafetyFitnessDeterminations(cont’d)• ProposedSafetyRatingProcess– AdministrativeReview• 49C.F.R. 385.15(mustbefiledwithin15daysofproposedUnfitrating)• 49C.F.R. 385.17(newComplianceAgreementrequirements)• Unconsideredinspectiondata
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CSAandCarrierSelection
• WhatisCSA?– Aprogramtomeasureandcarrieranddriversafetyperformancebasedoninspectionsandcrashesinorder(theSafetyMeasurementSystemorSMS)inordertoidentifythosemostlikelytogetintocrashes
– Carriersmeasuredin7BASICs (UnsafeDriving,HOS,DriverFitness,ControlledSubstances/Alcohol,VehicleMaintenance,Hazmat,CrashIndicator)withinpeergroups
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CSAandCarrierSelection
• Problemsinclude:– Lackofdata,particularlyonsmallcarrierswhoarethebulkoftheindustry
– Regionalenforcementdisparities– Questionableassignmentofseverityweights– Underreportingofcrashesbystates– Inclusionofnon-preventablecrashes– Increasedexposuretocrashesforcarriersinurbanenvironments
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CSAReform• “Wedidnotfindanymeaningfulstatisticalcorrelation
betweenBASICscoresandactualaccidentincidenceonthebasisofmilesdrivenornumberofpowerunitsinour4,600carrierdataset.”-- WellsFargoreportJul.2012
• ThoughATRI foundapositivestatisticalcorrelationbetweenBASICscoresandcrashesin3ofthepubliclyavailablemeasurementcategories,thisonlyestablishedatrendbasedonhundredsofthousandsofcarriers;tensofthousandshadscorescontrarytothetrend
• Notreliableformakingsafetyjudgmentsonindividualcarriers
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CoercionProhibitedConduct
• Theruleprohibitscoercingadriver tooperateacommercialmotorvehicle(“CMV”)wherethedriverhasobjectedthatsuchoperationwouldrequirethedrivertoviolateregulationsoftheFMCSA,includingtheFederalMotorCarrierSafetyRegulations(“FMCSR”).– Theruleappliestodirectcoercionofthedriver.– Adecisiontowithholdbusinessfromamotorcarrierisnotcoveredbytherule(butcouldbeaviolationifthe“driveristhecarrier”).
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Coercion(cont’d)
• Amongtheregulationsthatthedrivercannotbecoercedintoviolatingare:– Hoursofserviceregulations;– Equipmentinspection,repairandmaintenanceregulations;
– Intermodalroadability regulations;and– Regulationsregardingloadsecurement.
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Coercion(cont’d)
• Broadly.Thedefinitionincludes:– withholdingofbusiness;– withholdingemploymentorworkopportunities;or
– takingorpermittinganyadverseemploymentactionagainstthedriver.
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Coercion(cont’d)
• Thereisnodutytoaskthedriverwhetherornotheorshecancompletetherequestedserviceswithoutrunningafoulofregulations.
• However,forcarriers,thereisadutytoensurecompliancebydriversemployedorleasedtothecarrierwiththeregulations
• Aclaimofcoercionrequiresthedrivertoobjectandtoatleastgenerallyidentifytheregulationthatwouldbeviolated.
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Coercion(cont’d)
• Examples(foranintermediary):– Directthreatsagainstthedriver,including:• Refusaltoworkwiththedriverinthefuture;or• threateningtomakeanegativereportaboutthedrivertothedriver’scarrier.
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Coercion(cont’d)• Examples(foracarrier):
– firingorlayingoffadriverthathasvoicedanobjection;– decreasingdispatchopportunities,reducingpay,orreducing
hours;– reassigningthedriverinsuchamannerastoimpactpromotion
prospects;– reassignmenttolessfavorableshiftsorroutes;– movingthedrivertothe“bottom”ofthedispatchlistafter
rejectingdispatch(ifthedriverwouldnothaveotherwisemovedtothebottomhadtheloadbeenaccepted);or
– reportingnegativeinformationinanemploymenthistory(thoughFMCSAhasrecognizedthattherewillbesignificantevidentiaryobstaclestomakingacoercioncasetyingthereporttothedriver’srefusaltobecoerced).
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Entry-LevelDriverTraining• CurrentRequirements– CDLdriverswithlessthan1yearexperiencemustreceivetraininginfourareas:driverqualification,hours-of-service,driverwellness,whistleblowerprotection
– EvidenceoftrainingmustbekeptinDQ file• ProposedRequirements– ApplicabletothoseapplyingforaCDL,thosereapplyingfollowingdisqualification,andthoseseekingtoupgradetheirCDLoraddendorsements(e.g.,hazmatendorsement,tanktruckendorsement)
– Exceptionsformilitary,farmers,andfirefighters– CoreCurriculum(theory&behind-the-wheel)
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Entry-LevelDriverTraining(cont’d)• ProposedRequirements– CoreCurriculum(theory&behind-the-wheel)
• ClassA– minimum30hoursBTW(atleast10onrangeandatleast10onpublicroads)
• ClassB– minimum15hoursBTW(atleast7onpublicroads)
– Rulesfortrainingproviders(i.e.,curriculum,administration,trainerqualifications,assessments,trainingcertificates)
– TrainingprovidersmustbelistedonFMCSA’s TrainingProviderRegistry
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ElectronicLoggingDevices• CurrentRules(permissiveuseofAOBR)• RevisedRules(effectiveDec.18,2017)–MandatedELD useforalldriversrequiredtofilloutRODS
– Exemptions• DriverswhocompleteRODSfewerthan8daysinany30-dayperiod• Driveaway-towaway operations• Vehiclesmanufacturedbefore2000
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ElectronicLoggingDevices(cont’d)• RevisedRules(cont.)–MinimumELD capabilities• Integralsynchronization• Recordinglocation• Graphgriddisplay• Clocktimedrift• Communicationsmethods• Tamperingresistance• Sensorfailureandediteddata
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ElectronicLoggingDevices(cont’d)• RevisedRules(cont.)– SupportingDocuments
• Mustretainupto8supportingdocumentsforevery24-hourperiod
• Docsshouldlistdriver’snameorIDnumber,date,time,andlocation(e.g.,fuelrecords,tollreceipts,GPS,tripsheets,dispatchrecords,payroll)
– Privacy/DriverHarrassment• ELD musthave“mute”function• GPSlocationcapturedduringpersonalconveyancemustbelargerarea
• Driversmustcertifycarrieredits• Driversmusthaveaccesstologsforsix-monthperiod
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SleepApnea
• ANPRM inwhichagencyisseekinginformationonprevalenceofthecondition,diagnosticandtreatmentoptions,andcostsandbenefitsthereof
• ScreeningrecommendedbyNTSBandhadbeenrecommendedbyFMCSA’sMedicalReviewBoard
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Drug&AlcoholClearinghouse
• ProposalpushedbyCongresstoensureacentraldatabasetoreportresultsofdrugandalcoholtestsforCDLdrivers
• Wouldrequirecarriers,MedicalReviewOfficers,SubstanceAbuseProfessionals,andlabstoreportfailedtests,refusals,andsuccessfulreturn-to-dutytests
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Questions?