Jan 23, 2018
TORONTO, Ont. — Driver compensation is on the rise in 2018, as fleets in Canada and the U.S. compete for drivers to take advantage of a strong market.
“Everybody is upping their pay. Everybody,” said Jane Jazrawy, co-founder of Carriers Edge, which runs the Truckload Carriers Association’s Best Fleets to Drive For program. She was in the process of evaluating driver and fleet surveys for the 2018 program and said driver pay among the Best Fleets nominees rose 3.61 cents per mile (U.S.) from 2017 to 2018, from 50.71 cents in 2017 to 54.32 cents in 2018. That’s an extra $21.66 for a 600-mile day.
Average pay for owner-operators also climbed slightly, with revenue up about 1% on 2% fewer miles.
Jazrawy said more of the Best Fleets are also offering some form of guaranteed pay, which appeals to drivers by eliminating uncertainty and inconsistencies in their pay expectations.
“That is definitely becoming more of a trend,” she said, noting that among the Best Fleets finalists, about twice as many are now offering “full” guaranteed pay as in previous years.
“What I mean by full, is they have some amount (of pay) per week the driver can get if they don’t get their miles,” she explained. “There may be some stipulations around that – some kind of rule where you have to be available. If you decide to take three days off you’re not going to get your guaranteed pay, obviously.”
Fleets in the U.S. have been more aggressive with driver signing bonuses. Covenant Transport launched a US$40,000 teaming bonus, effective Feb. 1. Teams earn $2,000 in bonus money every time they eclipse 60,000 paid miles, up to a combined $40,000. The company said the move was done in order to increase its team truck count as demand is increasing for team capacity.
Another U.S. fleet, Royal Trucking, installed EpicVue satellite TV in all 250 of its trucks, in an effort to better attract and retain drivers. And such creative incentives and pay increases are coming to Canada as well.
Titanium Transportation Group announced it increased company driver pay by up to six cents per mile, and owner-operator rates by an additional 5% of revenue, effective Jan. 1. Drivers at Titanium are now earning more than ever before in the company’s history, Marilyn Daniel, chief operating officer, told Truck News.
“We believe over the next year, the driver shortage in Canada will be more pronounced,” she said. “I’ve always said we haven’t had a driver shortage yet. I’ve never had to advertise for drivers until now. We believe the fleets with the drivers will win in the end, and we’re starting to feel a capacity crunch. In the last few months of 2017 there was more freight than drivers, so we’re taking a leap of faith as we believe the marketplace is ripe for increases from shippers to begin, and we are raising rates now for drivers.”
Daniel said for the first time in several years, shippers are accepting contract rate increases.
“When reviewing contracts, we’re able to talk about increases, whereas it wasn’t even an option in the past,” said Daniel. “We are giving it to our drivers so they can be safer and make more money, and customers are understanding of it.”
Windsor, Ont.-based Morrice Transportation also announced a pay increase of five cents per mile, effective Jan. 1.
“I have had multiple drivers call to ask me about the raise, and are ecstatic to hear that most drivers will be seeing a five cent a mile increase to their base wage alone, on top of which our current accessorial pay and bonuses are factored in,” said Amanda Matalik, human resources manager. “As I have told our drivers, Morrice appreciates the hard work that our drivers commit to every day in order to make operations run smoothly, and hope that their dedication will continue as we grow and expand in the new year.”
Financial compensation, naturally, is an attractive incentive for drivers, but fleets are increasingly looking at other ways to lure and keep drivers. Publicly-traded Titanium offers a share-purchase plan, where it matches employee stock purchases.
“They’re buying stock 50% off market prices, really,” Daniel said. “It’s a big incentive for them to continue to work with us long-term, because there’s a vesting period for them.”
She also said drivers are looking to operate new, well-spec’d equipment.
“The average age of our trucks is two years,” she said. “A big part of driver retention is good equipment.”
And giving drivers the technology they need to make their lives easier also factors into a retention program, she added, “making drivers’ lives on the road as easy as possible. A lot of drivers are now looking to come home as often as possible, so we’re doing shorter runs, switches. I have drivers coming in now looking for work-life balance.”
When analyzing driver surveys as part of the Best Fleets to Drive For program, Jazrawy noted more drivers feel they’re paid “fairly” for the work they do. Equally important to them is how they feel about the people they work with, she noted.
“I think trucking companies are starting to realize the relationships they have with their drivers are just as important as the pay,” Jazrawy said. “Having a guaranteed pay model really helps…they know they’re going to be taken care of, and it makes them feel supported.”
To retain drivers, leading fleets are increasingly using social media, the latest tool being Facebook Live, which managers can use to communicate to their scattered drivers.
“A lot of drivers are on Facebook. It’s one of their main ways of communicating,” Jazrawy observed.