Wayne's World
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Wayne's World
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Join NTAWritten by Wayne Schooling
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Q: I heard that if my Motor Carrier Permit is suspended I can still operate because I am appealing the suspension. Is that true?
A: NO, that is totally false. Section 34623 (d) of the California Vehicle Code allows for an appeal, which will be held within a reasonable time but not longer than 21 days after DMV receives your written notice. At the hearing, you must show just cause why the suspension should not continue. During this time, you may not legally operate. If you are caught doing so, your vehicles could be impounded; fines and imprisonment could also result, whichever is earlier.
- Success Stories -
You’ve all heard the saying, “ If it’s to good to be true, it isn’t.” Well, I’m hear to tell you that for once, that’s not so. Our New Years present to our 10-4 readers is the best occupational accident program you will ever find, I flat guarantee that! NTA is proud to announce that because of our huge growth this year in membership, we have acquired several new low cost health discount programs, such as Medica Latina which has coverage in the US and Mexico. There is absolutely no reason you should be without health insurance for your family in our Southern California or Mexico coverage area. Because intermodal trucking pay rates are so low, we targeted this group so that even they could qualify. Our rates for our members start so low you just won’t believe it. Call our insurance department direct at 562-808-2258 for more information. And don’t forget our occupational accident policy coverage, which starts at $86 per month.
- Written lease requirements -
I received an email from John from Minnesota who had been working for a carrier in that state. After one month they owed him $7,000 and all he received was lip service when it came to paying him. It was only after he wrote to the attorney general’s office with a complaint did they start to pay him.
This leads me to believe that there are many drivers as well as owner operators who do not have the foggiest idea that there are actual written rules that govern the lease they are working under. So to start the new year out right I want everyone to reacquaint themselves with the rules that they should be working under.
You will find the written lease requirements on the internet at
www.access.gpo.gov/nara/cfr/index.html search under 49CFR376. The motor carrier’s lease must adhere to and perform by these lease provisions. In fact, last year a U.S. Appeals Court ruled that owner operators have the right to sue carriers that don’t comply with federal leasing regulations. If you don’t have a copy of 49CFR Part 376, Lease and Interchange of Vehicles, it’s a good idea to get one and review it against your current contract.
A federal judge has recently ruled that vehicle leasing arrangements between Ledar Transport, a Missouri based motor carrier and it’s drivers’ violated federal truth-in-leasing regulations. The judge cited more than 30 violations, mostly related to terms of payment and the company’s failure to properly disclose owner-operators’ right under the leases.
What makes this case interesting is that this is the first case based strictly on evidence that the carrier’s lease was not on compliance with 1996 leasing law.
In just the last three years, several carriers have been sued. One of these suits gave owner operators the right to sue if the leasing regulations were violated. The last suit was against Rocor International, which claimed a variety of misdeeds, including the legality of their workers’ compensation insurance program, overcharging for state fuel taxes and maintenance, withholding escrows funds and selling medical and life insurance without a license.
The court found the following provisions to be improper; The “early termination fee” is a penalty imposed by the carrier, unrelated to actual costs involved with the operation of leased equipment and is therefore illegal; Amounts deducted from escrow accounts must be specified in the lease; The regulations mandate payment to owner-operators within 15 days of submission of documents necessary for payment for the load and of driver’s log books. Carriers can withhold final payment only for failure of the owner operator to return identification devices to the carrier; Amount to be paid by the carrier for the equipment and drivers’ services shall be clearly stated on the face of the lease; Carrier cannot set time limits for the submission of required delivery documents or other paperwork and the time and date or circumstances of lease end must be specified.
There are about ten more items the judge cited for not being included in the lease but space restricts me here. What I have tried to do is point out the most important issues. When you sign on to a motor carrier always remember you are there to lease your truck and your services to the motor carrier – you are not there to start an escrow fund, a maintenance fund, a fuel tax or licensing account or to buy any insurance of any kind. These items should be only for your convenience. I see too many emails & letters and receive too many calls from owner operators who say they have too use the carriers insurance whether it be liability or so-called workers’ comp to work there. I say walk away. There are just too many carriers out there who are short of drivers who will treat you right & who will pay you on time and sometimes these are not necessarily big carriers. I know of quite a few small to medium carriers who fit the bill.
Remember know what the rules are first, then read and understand your lease before you sign it.
The lease provisions cover quite a few items here I want to address just two; pay compensation and workers’ compensation.
As far as compensation is concerned, the regulations state, “ The amount to be paid by the authorized carrier for equipment and driver’s services shall be clearly stated on the face of the lease or in an addendum which is attached to the lease. Such lease or addendum shall be delivered to the lessor prior to the commencement of any trip in the service of the authorized carrier. An authorized representative of the lessor may accept these documents. The amount to be paid may be expressed as a percentage of gross revenue, a flat rate per mile, a variable rate depending on the direction traveled or the type of commodity transported, or by any other method of compensation mutually agreed upon by the parties to the lease. The compensation stated on the lease or in the attached addendum may apply to equipment and driver’s services either separately or as a combined amount.”
It also has been brought to my attention that some carriers are demanding that owner operators take a deduction for certain products and services i.e. workers’ compensation, etc. Section 376.12 (i) of the lease requirements covers “Products, equipment, or services from authorized carrier.” It states very clearly, “ The lease shall specify that the lessor is not required to purchase or rent any products, equipment, or service from the authorized carrier as a condition of entering into the lease arrangement. The lease shall specify the terms of any agreement in which the lessor is a party to an equipment purchase or rental contract which gives the authorized carrier the right to make deductions from the lessor’s compensation for purchase or rental payments.”
Further pursuant to California Labor Code Section 4150, an employer may provide workers’ compensation coverage to individuals not included in the definition of employee if both parties elect to do so. While such an election would serve to protect an employer from liability for civil tort suits from injured misclassified independent contractors, it may also serve as an indication of employment status in other concerns. For instance, don’t forget that after 1/1/01 all motor carriers must report all contractors to the EDD in California. The EDD also is the agency that administers and enforces the laws regarding the withholding of state personal income taxes by employers and has the authority to reclassify a misclassification by an employer.
Remember know the rules first then read and understand your lease before you sign it.
The NTA is a nationwide association established to provide services, benefits and information to Private Fleets, Trucking Companies and Owner-Operators. We provide our members with more FREE services and benefits than any other association. For more information or details call (562) 630-7637 in California or 800 805-0040 or you can E-Mail me at wayne@ntassoc.com Remember, tell those who doubt your profession, " If you've got it ….A TRUCKER BROUGHT IT ! Until next month, " Drive Safely - Drive Smart ! "
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Wayne Schooling
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