Drivers Compensation

Mar 03, 2025 at 12:02 AM CST + 6
Posted by a private BulkLoads.com member.	Posted by a private BulkLoads.com member. I'm considering moving my drivers from hourly pay to percentage pay. My guys run a mix of OTR and local. I've had guys on % pay and guys on hourly. Both have their pros and cons. For those of you paying percentage I have a few questions. 1) what % are you paying? 2) Are you taking a fuel surcharge out of that? if so, what base price are you using? 3) When you are doing a job that is hourly, how are you doing a fuel surcharge then? All thoughts are appreciated

Replied on Mon, Mar 03, 2025 at 10:33 AM CST
Posted by a private BulkLoads.com member.	Posted by a private BulkLoads.com member. I pay hourly and often feel is puts me at a competetive disadvantage when bidding on work. My competitors have no cost associated with time, yet it's my biggest expense and factor in determining a rate. However, I cannot stand how the industry asks drivers to work for free during the toughest times on the job, such as delays, traffic, etc.. Why should they not get paid for doing their job with patience? For local, it is more straight forward. I don't do OTR yet and do wonder how I would structure pay in that market, as the drivers' personal time and on job time blend and it would be very hard to accurately track true on and off duty time. I would probably do a hyrbid between hourly and mileage. From the perspective of a company driver, I hate % pay and would avoid jobs that pay that way for the reasons listed above as well as lack of transparency and trust in what you are being told the rate is. I have seen first hand how my large competitors show dishonest rates to their drivers. I know the actual rates because my customer shows them to me. The rates their drivers say their % is based off of is significantly lower. Companies have a way of taking out fuel surcharge, tolls, tank washes, etc.. Those 3 things are fair in my opinion, at least tolls and tank washes. Fuel surcharges are structured so many different ways and can often take up 40% of the rate, far exceeding actual fuel costs. There is just too much grey, even with the simple things. I am also sure they find other phony add on charges they deduct before showing a driver a base rate. I know this doesn't answer your question, but it's a topic I feel strongly about. I think you may experience driver retention and recruitment issues after switching from hourly to %. At the end of the day, % exists to eliminate costs associated with time and does so by not (or poorly) compensating drivers for hours worked.

Replied on Mon, Mar 03, 2025 at 10:33 AM CST

Posted by a private BulkLoads.com member.

I pay hourly and often feel is puts me at a competetive disadvantage when bidding on work. My competitors have no cost associated with time, yet it's my biggest expense and factor in determining a rate. However, I cannot stand how the industry asks drivers to work for free during the toughest times on the job, such as delays, traffic, etc.. Why should they not get paid for doing their job with patience? For local, it is more straight forward. I don't do OTR yet and do wonder how I would structure pay in that market, as the drivers' personal time and on job time blend and it would be very hard to accurately track true on and off duty time. I would probably do a hyrbid between hourly and mileage. From the perspective of a company driver, I hate % pay and would avoid jobs that pay that way for the reasons listed above as well as lack of transparency and trust in what you are being told the rate is. I have seen first hand how my large competitors show dishonest rates to their drivers. I know the actual rates because my customer shows them to me. The rates their drivers say their % is based off of is significantly lower. Companies have a way of taking out fuel surcharge, tolls, tank washes, etc.. Those 3 things are fair in my opinion, at least tolls and tank washes. Fuel surcharges are structured so many different ways and can often take up 40% of the rate, far exceeding actual fuel costs. There is just too much grey, even with the simple things. I am also sure they find other phony add on charges they deduct before showing a driver a base rate. I know this doesn't answer your question, but it's a topic I feel strongly about. I think you may experience driver retention and recruitment issues after switching from hourly to %. At the end of the day, % exists to eliminate costs associated with time and does so by not (or poorly) compensating drivers for hours worked.

Replied on Mon, Mar 03, 2025 at 11:13 AM CST + 2
Posted by a private BulkLoads.com member.	Posted by a private BulkLoads.com member. I pay % in my tanker business, @35% of load gross FSC included. In my sector our rates include up to 2 hrs of detention, then we do get paid demurage, the demurage pay does go to the driver. I am transparent with my drivers, including the invoices for the loads they hauled on their pay stubs so they know they are getting their due pay. If you are not willing to share this info with your drivers then in it brings to question your ethics in doing business. I want my drivers be as efficient as possible and paying them a % of what they make me is the best way I've found to motivate them. The more they make me the more they take home. Its also a motivator to get them to take less desirable lanes that pay better.

Replied on Mon, Mar 03, 2025 at 11:13 AM CST

+ 2

Posted by a private BulkLoads.com member.

I pay % in my tanker business, @35% of load gross FSC included. In my sector our rates include up to 2 hrs of detention, then we do get paid demurage, the demurage pay does go to the driver. I am transparent with my drivers, including the invoices for the loads they hauled on their pay stubs so they know they are getting their due pay. If you are not willing to share this info with your drivers then in it brings to question your ethics in doing business. I want my drivers be as efficient as possible and paying them a % of what they make me is the best way I've found to motivate them. The more they make me the more they take home. Its also a motivator to get them to take less desirable lanes that pay better.

Replied on Mon, Mar 03, 2025 at 11:28 AM CST
Posted by a private BulkLoads.com member.	Posted by a private BulkLoads.com member. Quote: "I pay % in my tanker business, @35% of load gross FSC included. In my sector our rates include up to 2 hrs of detention, then we do get paid demurage, the demurage pay does go to the driver. I am transparent with my drivers, including the invoices for the loads they hauled on their pay stubs so they know they are getting their due pay. If you are not willing to share this info with your drivers then in it brings to question your ethics in doing business. I want my drivers be as efficient as possible and paying them a % of what they make me is the best way I've found to motivate them. The more they make me the more they take home. Its also a motivator to get them to take less desirable lanes that pay better." Though I take a different approach to compensation, all very good points! 35% is way above most. Assuming decent rates, you probably have a good group of drivers.

Replied on Mon, Mar 03, 2025 at 11:28 AM CST

Posted by a private BulkLoads.com member.

Quote: "I pay % in my tanker business, @35% of load gross FSC included. In my sector our rates include up to 2 hrs of detention, then we do get paid demurage, the demurage pay does go to the driver. I am transparent with my drivers, including the invoices for the loads they hauled on their pay stubs so they know they are getting their due pay. If you are not willing to share this info with your drivers then in it brings to question your ethics in doing business. I want my drivers be as efficient as possible and paying them a % of what they make me is the best way I've found to motivate them. The more they make me the more they take home. Its also a motivator to get them to take less desirable lanes that pay better."

Though I take a different approach to compensation, all very good points! 35% is way above most. Assuming decent rates, you probably have a good group of drivers.

Replied on Mon, Mar 03, 2025 at 01:29 PM CST - 1
Posted by a private BulkLoads.com member.	Posted by a private BulkLoads.com member. Quote: "Though I take a different approach to compensation, all very good points! 35% is way above most. Assuming decent rates, you probably have a good group of drivers." Hazmat

Replied on Fri, Mar 07, 2025 at 07:51 AM CST
Posted by a private BulkLoads.com member.	Posted by a private BulkLoads.com member. Thanks for the insight! I think we're going to stay hourly but rework our bonus structure to end up in a best of both worlds scenario. Like I said both have their pros/cons. I just want my guys to be happy enough working here that if someone asked them where to drive at they'd say schmitz

Replied on Fri, Mar 07, 2025 at 09:44 AM CST
Posted by a private BulkLoads.com member.	Posted by a private BulkLoads.com member. Good thread guys. As a driver or a leased operator years ago,I prefered the percentage route for the incentive. Years later I might see it differently, whether or not you have "skin in the game" to take the the risk of the market forces. The FSC is messy on various levels. Yes, I've known of companies purposely "loading" the FSC high with customers because they paid their drivers on percentage of the base rate. WOW! Crooked. I still prefer a tonnage rate in my bulk business for the incentive of the effort and efficiency.

Replied on Fri, Mar 07, 2025 at 09:44 AM CST

Posted by a private BulkLoads.com member.

Good thread guys. As a driver or a leased operator years ago,I prefered the percentage route for the incentive. Years later I might see it differently, whether or not you have "skin in the game" to take the the risk of the market forces. The FSC is messy on various levels. Yes, I've known of companies purposely "loading" the FSC high with customers because they paid their drivers on percentage of the base rate. WOW! Crooked.

I still prefer a tonnage rate in my bulk business for the incentive of the effort and efficiency.

Replied on Fri, Mar 07, 2025 at 09:55 AM CST
Posted by a private BulkLoads.com member.	Posted by a private BulkLoads.com member. We pay .90 cents a mile on all miles our drivers run!

Replied on Sat, Mar 08, 2025 at 09:15 AM CST - 1
Posted by a private BulkLoads.com member.	Posted by a private BulkLoads.com member. I used to pay hourly in the past and it is amazing how when you fill in for your driver you turn what is consistantly 12-14 hour days for them into 8-10 hour days. I don't think I will ever pay hourly again unless it's for a strictly hourly gig. Sad from when I was a company driver I always said it shouldn't be the drivers problem if the truck is working a cheap job but hey guess there needs to be a fire under someones bum somehow lol That said, the going rate from cows to flatbed that I've ever heard is 25-29%. That's assuming you're doing decent paying work.

Replied on Sat, Mar 08, 2025 at 09:15 AM CST

- 1

Posted by a private BulkLoads.com member.

I used to pay hourly in the past and it is amazing how when you fill in for your driver you turn what is consistantly 12-14 hour days for them into 8-10 hour days. I don't think I will ever pay hourly again unless it's for a strictly hourly gig. Sad from when I was a company driver I always said it shouldn't be the drivers problem if the truck is working a cheap job but hey guess there needs to be a fire under someones bum somehow lol

That said, the going rate from cows to flatbed that I've ever heard is 25-29%. That's assuming you're doing decent paying work.