The Federal Motor Carrier Safety Administration (FMCSA) has been in the news a lot lately, and the news surrounding them only gets longer as time goes on. On May 19th, the Owner-Operator Independent Driver Association (OOIDA) filed a petition with the FMCSA to demand new regulations that improve broker transparency.
The Problem
Owner-Operators are starting to struggle during the COVID-19 pandemic. While the bigger, more established fleets have delivery contracts from major businesses to keep them going, an Owner-Operator fighting in the spot market may be hanging by their fingernails. This gives brokers extra leverage in negotiating rates.
Federal regulations state that records of all brokered transactions must be kept for three years and that all parties involved in the transaction have the right to view them. Todd Spencer, president and CEO of OOIDA, says this is not how brokers currently operate. ”The problem is that the regulations designed to provide transparency are routinely evaded by brokers or simply not enforced by DOT.”
One such method that brokers legally evade showing drivers the records is by making them available, but only at the broker’s physical location. Considering how most truckers operate on a nationwide scale, it is often too much of a burden for the driver to visit, while the broker can say that the option is “always” available.
The Solution
The OOIDA petition asks for four different changes to improve transparency:
- Brokers must automatically provide an electronic copy of each transaction record within 48 hours after the contracted delivery has been finished, avoiding the “physical location” loophole.
- Prohibit brokers from ever requiring a carrier to waive their rights to access the transaction records as part of contractual terms.
- Disallow brokers from retaliation against relevant parties who request the information, such as denying a driver a future delivery contract they would otherwise be perfect for fulfilling.
- Enforce established regulations more closely, including fines and suspensions for violating brokers.
The Transportation Intermediaries Association (TIA), a parallel to the OOIDA that represents the brokers, became enraged over these suggestions. Robert Voltmann, president and CEO, pointed to a letter about the same topic in 2005 that implied increased transparency regulations are more akin to communist Cuba than the United States.
Conclusion
This is not the first time the OOIDA and the TIA have butted heads with one another over federal regulations. The argument stretches back to 2005 when Voltmann, who was also president and CEO at the time, debated with the then-president of the OOIDA Jim Johnston.
In any case, this argument has been raging in the background for the past fifteen years. Whether it comes to its conclusion in 2020 and if the current COVID-19 pandemic plays a part in the FMCSA making any changes has yet to be seen.
Article courtesy of TopMark Funding.
