A new survey out this year finds that the majority of truck drivers prefer to be paid by a percentage split, and then by the hour, with per-mile coming in dead last. As a whole, drivers who were paid this way reported being 31 percent more satisfied with their jobs than those who received hourly or per-mile pay.
In this case, what truck drivers want isn’t meshing with what’s going on in the marketplace. Today, per-mile pay dominates fleet pay structures. There are currently only a handful of companies that pay their drivers by percentage split. But is it right?
How Does It Work?
Per-mile pay works in several different ways. Here are the two different ways a fleet might structure their per-mile pay schedule:
- Practical Miles: These are the actual miles a truck driver drove to get to the destination.
- Short Miles (Direct Route): The direct route only pays the shortest possible route.
To put this into perspective, imagine if a driver runs a load from Casa Grande, Arizona to Las Vegas, Nevada. Said driver gets paid 36 cents per-mile.
Unfortunately, they are unable to cross the Hoover Dam, so they must take the route around it, which adds up to 429 miles. If his fleet is paying him by practical miles, then his pay for that run would come out to $154.44.
If the his fleet is paying by short miles, then the direct route – across the Hoover Dam, which he or she can’t do – would come out to 360 miles. This would drop their pay down to $129.60.
In some cases fleets also employ a sliding scale mileage pay system. In this system, longer trips result in lower pay. A load that runs 350 miles might pay 36 cents per-mile. A 2,000 mile run might drop that to 28 cents per-mile, or less.
How Are Truckers Affected?
Another aspect of per-mile pay that is often overlooked is for work the truck driver does that he or she doesn’t get paid for. When someone is getting paid by the mile, spending hours waiting at a loading dock is time on the job that they aren’t getting paid for.
This also includes truck downtime, waiting at truck-stops between loads, chaining or un-chaining tires in the snow, or anything else that requires the truck driver to handle a job duty that doesn’t involve putting miles in the log.
A major pain-point between truckers and shippers lies in their warehouse operations. Any hiccup in their operation is soaked up by the driver at no cost to anyone else in the pay chain. In fact, it’s not uncommon for a truck driver to pull into a warehouse right after it closes and then sleep in the truck until they open the next day, just to be first in line.
Is It Fair?
Some believe that paying by the mile is both unsafe and unfair. They believe that this model encourages truckers to speed in order to make more money.
Getting paid by the mile also prevents truckers from knowing how much they will make in any given week. After all, it’s hard to predict breakdowns, traffic, man-made or weather related delays. For this reason, many truck drivers report that inconsistent pay is even worse than low pay.
But if so many truck drivers prefer to be paid by percentage or by the hour, why aren’t more fleets changing their pay models? The simple answer is that they are reluctant to change a business model they have relied on for decades.
President Franklin D. Roosevelt exempted truckers from the Fair Labor Standards Act. Most state overtime laws also do not apply to truck drivers. Furthermore, regulations that protect pay, safety, and health often don’t include truck drivers.
The Case for Change
The fact remains that the trucking industry handles 67 percent of the country’s total freight by weight. While there are currently around 2.6 million truck drivers on the road, the nation needs another 35,000 at the minimum.
The shortage is especially acute in longhaul operations. There are several reasons for the shortage, but the fact remains: Fleets need to re-think their entire strategy, from recruitment to retention.
If changing their pay model increases interest in trucking as a career, carriers should look at how they can modify their current structure to make themselves look more attractive. Otherwise the employment squeeze is going to remain a hot topic for a long time to come.