Trucking News

Oakland, CA. At the Union Pacific Rail Terminal truckers have had enough. Trucks are pulling over in solidarity to protest the rising fuel costs they must shoulder. Most of the truck drivers are only being compensated for 12% of their fuel costs. “We want to work.” Said many of the owner-operator drivers, but they can’t afford to when their fuel costs exceed the fees companies pay them to haul the loads.

Four years ago companies negotiated to pay 5% of the fuel costs above $2.00 per gallon. Drivers protesting say they have not been compensated.

Protesters yell and jeer at trucks passing by. Many fellow truck drivers abruptly stop their rigs and join them. Truckers in surrounding locations are also pulling over to support the cause.

Is this the first sign of things to come? Most economists are in agreement: oil prices are on a permanent upward trajectory. Cities are dependent on food and other goods arriving daily, most cities cannot continue normal activity for more than 72 hours without fresh inventory arriving. The protesting truck drivers at Union Pacific Rail Terminal are addressing this increasingly dangerous crisis now, we should all pay attention. Truck drivers cannot shoulder the impossible burden of endlessly rising fuel costs.

Well, you might first ask yourself, “Should I hire more drivers?”  Not every trucking business is ready for expansion.  Having additional drivers means more management responsibility resting squarely on your shoulders.  Not only will you have to deal with keeping your customer happy, but keeping drivers happy.  Keeping drivers happy can be a full time job sometimes.  And if they aren’t happy, chances are they will not treat your customers very well.  You will also have the added liability of these drivers doing something wrong on your company’s behalf so you want to make sure that you don’t just hire any warm body to fill the seat.

Once you’ve decided to move forward and expand, you have a couple options.  You can either lease on other owner/operators under a contract that are paid with a 1099, or you can hire company employees that are paid with a W-2.  Depending on the size of your business, and administrative resources, either option has its advantages.  With 1099 contractors, you only have to pay them when they work, and you don’t have to worry about employee benefits such as health insurance and paid vacations.  Contractors also tend to be more reliable since their pay is dependent upon their reliability.  On the other hand, W-2 employees are more readily available, and are generally easier to keep happy as long as the benefits are present, but require more support with payroll.  My rule of thumb has always been this:  if you have enough business to afford new trucks and have office staff, then buy trucks and hire employees.  If you are smaller and would need to purchase used equipment to expand and have limited or no office staff, then use owner operators.  The fewer headaches you have, the better.