Last week, the Owner-Operator Independent Drivers Association (OOIDA) wrote to Congress asking for intervention to make sure that freight brokers are paying truck drivers fairly.
For weeks now, truckers across the country have been demonstrating to raise awareness about several issues in trucking, expressing worry that their businesses will not survive the tough economic conditions brought during the Coronavirus crisis. Last week, President Trump even responded to a group of protesters who parked their rigs in Washington D.C. to raise awareness about low rates and unfair broker practices. During a Fox News appearance, Trump said that he believes that truckers are the victims of “price gouging.”
In a May 6 letter to Congress, OOIDA tells lawmakers that independent truckers are struggling financially during COVID-19 and that these struggles have shined a spotlight on the “long-time problem” of lack of transparency between freight brokers and carriers.
In the letter, OOIDA asks Congress to tighten loopholes that brokers use to avoid complying with federal regulations that require them to maintain detailed records of their transactions with carriers. OOIDA also asks Congress to require brokers to immediately provide motor carriers with an electronic copy of each transaction record once the contractual service has been completed in order to increase transparency.
You can read OOIDA’s letter below.
May 6, 2020
Dear Member of Congress;
The services provided by truck drivers are currently in high demand, but at the same time many small trucking businesses are far from certain they will survive today’s economic downturn. With freight rates reaching historic lows, small business truckers are struggling. Many have reached out to Congressional offices to express frustration not only about feeble rates, but the utter lack of transparency between brokers and motor carriers. The problem is regulations designed to ensure transparency are commonly skirted by brokers – it’s practically an industry norm. While little can be done by Congress to improve rates, much more can be done in the next COVID-19 relief bill to help truckers know they are being compensated fairly.
Existing regulations (49 CFR 371.3) require brokers to keep records of transactions with motor carriers. Under Part 371.3, each party to a brokered transaction also has the right to review the record of the transaction. This allows our members to know precisely how much a shipper paid the broker and how much the broker then paid the carrier. Unfortunately, brokers continue to circumvent this federal regulation in two ways:
Small business truckers would never get away with blatantly and deliberately evading federal regulations. Brokers must be held to the same standard. Unfortunately, rampant evasion is increasingly resulting in carriers assuming – fairly or not – that brokers have something to hide.
There are two simple solutions:
OOIDA has long pushed for greater transparency in transactions with brokers, but COVID-19 has made this an even more pressing matter. With rates on the decline, many of our members are concerned they’re the only ones feeling the pain – or at least feeling a disproportionate amount of the pain. This will not change until Congress addresses the widespread evasion of 49 CFR 371.3. Therefore, when developing the next COVID-19 relief bill, Congress must include measures to prevent brokers from continuing to circumvent existing federal transparency requirements.
If you have any questions, need additional information or would like to work with OOIDA to advance any of these recommendations, please contact Collin Long, Director of Government Affairs, via email at collin_long@ooida.com.
Sincerely,
Todd Spencer
President & CEO
Owner-Operator Independent Drivers Association
cc: Federal Motor Carrier Safety Administration