Incentives and Disincentives

This post appeared in Truck News June, 2014

Many carriers have incentive programs in place for their drivers and I’ve been wondering how effective these programs really are. Most programs are based on quarterly results that track percentage of idle time, percentage of time on cruise control and keeping speed at or below a pre-determined maximum. The obvious purpose is to reduce fuel usage since these cost savings go straight to a carriers bottom line. There are many other factors that carriers may include in their fuel & safety incentive bonus programs. What peaked my curiosity about these programs was a conversation I had with a senior manager of a mid-sized carrier several months ago and it’s been germinating in the back of my mind ever since.

This particular carrier had been running a new incentive program for about a year and I knew the program was generous and simple in its structure making the bonus attainable for any driver worth his or her salt. So I was a little taken aback when I was told yes, the company was pleased with the cost savings but disappointed to find that drivers were taking more time off as a result. A majority (not all) of this companies drivers saw an opportunity to take the bonus in the form of more home time rather than more money in the bank. The bonus simply replaced the drivers’ regular earnings. So there was no net loss or gain to the drivers’ income. The carrier gained on the hard cost of fuel saving but lost on the productivity side. Interesting eh?

Put a group of truckers together and you’ll be hard pressed to get them to reach a consensus on many of the hot button issues we face in the industry today. But one thing I believe we can all agree on is that time is money and a driver’s time is often not respected as it should be. No, I don’t believe there is an intention on the part of carriers to screw drivers over in respect to their time, whether it be time on the clock or a driver’s personal time. But the fact is that a driver’s stress level is affected by time conflicts more than any other issue. Let’s take a look at a couple of obvious examples that we see time and again across our industry.

Dock delays. We hate dock delays. Paying us for dock delays only dulls the pain, it doesn’t resolve anything. Even a delay of only a few hours can cost us a whole day due to the nature of the hours of service requirements or the fact we may miss a pickup or drop later in the day and end up spending a night waiting for that shipper or receiver to open the following morning.

Equipment downtime. This has been a horrendous problem since the introduction of the EPA 07 and EPA 10 regulations. It’s getting better but it still sucks. It’s not so much the initial breakdown as the time it takes to get the truck back up and running again. Sure, most companies, the reputable ones at least, compensate us in the form of layovers and house us in a motel until the repair is done. But a breakdown always seems to happen when you planned to be home for little Johnny’s birthday. Nobody wins in this situation.

You may look at the above two examples and say hey, wait a minute, that’s just trucking. Those are situations beyond a carrier’s control. Well, maybe they are. But I would bet that if drivers were paid by the hour for all of their on duty time then carrier lobby groups would be all over shippers, receivers, and OEM’s like ugly on an ape in order to resolve the problem. If that type of pressure failed to work then I think we would see freight rates start to reflect the true cost of doing business.

Then there are those unlucky drivers out there that find themselves working for the fly by night operators or the all around cheapskates. Many of us have been there, usually in our first year working in the trucking biz when we didn’t know any better. I could make a long list of time abuses these carriers typically pile on to drivers but I don’t have the space. If you work for one of these outfits don’t look for a bonus incentive program in your future as long as you stick with them.

Drivers, like anyone else, have an expectation of an income in line with their skill level and performance. We recognize and embrace the commitment we have to make in order to succeed in this business. Incentive bonus programs recognize our skill, performance, and commitment. Those same programs are also allowing the drivers that choose to do so improve their quality of life by taking additional time off without a loss of overall income. That’s a good thing.