Hour Rule Costs
Q I have heard that the new hours-of-service requirements will put a premium on driver’s time and result in more requests for spotting equipment and detention of loaded trailers without power. What are the rules governing detention and how do we obtain compensation for the necessary additional trailers the new rules may necessitate?
A I think you are right in your assessment about the effect of the new rules. For a driver, time is money. The inability of a truckload driver to conserve driving time by logging off duty, not driving, during his 14-hour workday means that carriers must enforce limited free time charging for detention, with or without power, for equipment tie-ups that exceed these limitations.
Detention is a common law concept that has its roots in the rail and shipping industry where demurrage is charged when rail cars or shipping vessels are detained beyond the free time allowed in the carrier’s service conditions or contracts. Motor carriers, as part of their standard holding out should publish free time and detention provisions in their service conditions or rules tariff as well.
Under the standard and the uniform bills of lading, carriers have the right to collect detention from any party liable for freight charges like “all other lawful charges accruing on said property.” Typically, however, detention is billed against the party causing the delay. All too frequently, small carriers do not have detention provisions in their rules. They are at the shipper’s mercy when seeking compensation for weekend delays and loading and unloading.
Yet, I anticipate that the new hours-of-service rules will lead many more carriers to get serious about measuring free time and billing and assessing for detention of equipment with power. Large shippers can be expected to increase their reliance on trailer pools to eliminate scheduling problems, and carriers will be under pressure to maintain additional pools of equipment free of charge.
Carriers should build a variable costing model that calculates and incorporates into their rate structure their variable costs for detention, both with and without power. Provisions for the assessment of detention should be incorporated into the carrier’s rules tariff and should not be ignored or waived by contract. Typically, truckload carriers adopt rules provisions that the loading and unloading of shipments occur upon arrival during ordinary business hours subject to two hours of free time.
Carriers should adopt procedures for monitoring detention and documenting it on the bill of lading or other contemporaneous shipping documents. Given the productivity challenges created by the new hours rule, carriers can’t afford to give customers a free ride for extended delays.