An independent truck drivers association is prodding a federal regulatory agency for an update on a request it made more than two years ago to create a rule on broker transaction transparency.
The Missouri-based Owner-Operator Independent Drivers Association (OOIDA) on Wednesday asked the Federal Motor Carrier Safety Administration (FMCSA) for an update on a rule that would require brokers to provide truck drivers with an electronic copy of transactions no later than 48 hours after a job is completed and put an end to contracts that deny a driver’s right to such records.
The association, which counts more than 150,000 independent trucker members throughout the country, first filed its petition for a new rule in August of 2020.
“It has been over two years since OOIDA submitted its original petition, 20 months since the most recent comment period ended for broker transparency-related dockets and nearly 1,500 comments have been filed on the dockets listed above,” OOIDA president and CEO Todd Spencer said in a letter sent Wednesday to the FMCSA. “For that reason, we believe an update is warranted on where the agency stands on our outstanding petition and related comments from motor carriers.”
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Brokers serve as the conduit between shippers and carriers in transactions. Federal regulation already requires records of transactions be kept and that all involved parties be allowed to view such records.
“For truckers who took the time to file comments and share their experience, it is frustrating when they feel as if their voices aren’t being heard or properly considered,” Spencer said. “Especially with regard to an issue involving transparency, FMCSA’s lack of public progress further undermines carriers’ confidence in a system that is supposed to protect them and be responsive to their legitimate and appropriately expressed concerns.”
The tussle between some drivers and brokers is related to just how easy it is for drivers to obtain transaction information.
Drivers say they often encounter contracts forcing them to waive their rights to such information, or brokerages that require carriers to come into a broker’s office during business hours to access the records.
“Brokers know this makes it virtually impossible for most carriers to access records,” one driver wrote to the FMCSA during its 2020 public comment period on the requirement of going into a broker office for information. “Further, when a carrier tries to assert his/her right to review this information, the broker is unlikely to contract with them again. These tactics further undermine [the federal regulation]. Small business truckers would never get away with blatantly and deliberately evading federal regulations. Brokers must be held to the same standard.”
Another driver pointed out access to transaction information allows truckers to see how much shippers are paying to have their cargo moved and how much of that payment brokers are keeping.
A spokesperson for OOIDA said “it’s all over the place” when it comes to what percentage of a transaction goes to brokerages.
“Remember, this is supply and demand,” the spokesperson said. “[The] more trucks, the bigger the cut for the brokers. They want to move the load as cheaply as possible.”
OOIDA said it’s not trying to control rates or also create more regulations, the latter being a charge made by the Transportation Intermediaries Association (TIA) against the proposed rule on transparency.
TIA is a Virginia-based organization representing brokers in the third-party logistics space.
The group challenged OOIDA’s proposed rule and suggested an idea of its own in November 2020: scrap the transparency rule already on the books. It argued transparency already exists between brokers and drivers in the form of the internet, rate quotes and in-person communication.
Thus, the TIA said in its petition, there is enough information available “without inspecting brokers’ shipment records to find out what the brokers’ gross margins are on a load-by-load basis.”
TIA waived off OOIDA’s calls for transparency protections at the time of the proposed rule by calling the move “political opportunism” and said rates, at the time of the downturn when the group petitioned for change, were a result of the economic downturn brought on by the pandemic rather than “price fixing or price gouging.” TIA vice president of government affairs Chris Burroughs has criticized the OOIDA proposal as “an attempt to undermine the free market.”