Easing the pain of new HOS regulations

Seismic changes to truck driver hours-of-service rules that became effective January 4 could have the most significant structural impact on chemical distribution by tank truck since the trucking industry was deregulated in the early 1980s, said John Conley, vice-president, National Tank Truck Carriers Inc. Just how much operations will be impacted will depend on how well shippers and carriers work together to adapt to the new environment.

Conley spoke at the Chemical Week Associates Chemical Transportation & Distribution Conference in New Orleans, Louisiana, in January. He addressed the expected impact of new requirements for fingerprint-based background checks for the hazardous materials endorsement. He also offered a list of suggestions that shippers can use to help tank truck carriers achieve the best performance under the new hours-of-service rules.

“The new hours of service regulations were not developed by the trucking industry as a ploy to raise rates,” Conley said. “The first significant revisions to the hours of service since the 1930s were imposed on the trucking industry by the federal government. Industry would have written the rules differently but largely views the changes as improvements.

“Implementing the new regulations is not just a carrier problem. It is an industry-wide problem. Drivers primarily are paid to safely move products from point A to point B. These changes will affect drivers and their ability to earn an income more than anyone else in the distribution process. Carriers, shippers, and law enforcement must ensure that drivers are not penalized by these changes — or we simply will not have enough drivers.”

A driver previously could be on duty for 15 hours and drive for 10 of those hours. Under the new rules, a driver may be on duty for 14 hours and drive 11 of those hours. Prior to January 4, the hours were cumulative; now they must be logged consecutively.

Under the old rules, a driver could extend the 15-hour period by logging some time as off duty/not driving. Such time was used when he stopped for meals or when he was able to log off to wait to load, for samples to be taken, or perhaps to avoid bad traffic. If he logged off for four hours after starting his shift, he could extend his 15 hours of available work time to 19 hours.

That option is not available under the new regulations. After the driver punches in, the clock continues to tick whether he is driving, waiting in line with 10 other trucks to load, or cooling his heels for a few hours waiting for a sample to be checked. The clock ticks for 14 consecutive hours, and the driver can drive only 11 of those hours. If he spends more than three of those hours doing something other than driving, then that time reduces his 11 hours of allowed driving time.

“The tank truck industry has two basic requests of the shipper community and of its customers,” Conley said. “Help us to continue to provide the service you demand and deserve by enabling our drivers to use all driving hours allowed under the new regulations. This boils down to get them in, get them loaded, and get them on the road.

“Please review distribution facilities and procedures to reduce the time drivers must spend at the plant, as well as to the facilities to which we deliver your products. Examine the time drivers spend at a facility as part of your quality process. Work with us to calculate the required driver time for the safe and secure loading of products. Measure this time as you would any other element of your distribution quality process.

“When significant time must be spent for drivers to load and unload products, work with us to develop creative ways to handle those deliveries. This may involve adjusting pick-up and delivery times, pre-loading, or how samples are taken.

“If it takes more drivers and more tank trailers to haul the same amount of product, then it will cost more to ship the product. Just as you should reject the contention by a carrier that ‘we need an across the board rate increase because of hours of service,’ you should not have the attitude of ‘forget any rate increases because of hours of service.’ Each lane must be analyzed to see if changes in operations or costs will be required.”

Hazmat endorsement

Another issue that will impact driver availability in the tank truck industry are new requirements for background checks for the hazardous materials endorsement for the commercial driver license. The Department of Homeland Security has given states until April 1 to implement a program for collecting fingerprints and other information for background check analysis. States can delay implementation until December of 2004 if they tell Homeland Security by April 1 how their program will work.

“We are not concerned that we will lose drivers who fail the background check,” Conley said. “The major crimes that trigger rejection would have been found in background checks already performed by carriers. We are concerned that drivers will not want to go through the added time and expense of applying for the hazardous materials endorsement, and they will simply choose other driving jobs. We also know that drivers who do obtain the hazardous materials endorsement will feel that they offer a special qualification that should lead to higher compensation. It is hard to argue with this conclusion.”

Shippers can do much to help carriers implement the new regulations with the least impact on operations and costs. Conley presented the following lists of suggestions based on a survey of chemical tank truck carrier management personnel.

Ten ways shippers can help carriers to be more efficient

1. Expand pick-up and delivery windows. This was the most frequent request. Do not automatically mandate the 0800 delivery time. Work with consignee to arrange more delivery flexibility, perhaps with a price incentive. Use whole day and whole week. Try to reduce the Monday and Friday spikes.

2. Coordinate requirements of both the purchasing and distribution departments to help the carrier increase loaded miles. Coordinating inbound and outbound movements will improve equipment and driver utilization and benefit all parties.

3. Develop well-written procedures for loading and unloading at customer facilities. Ensure that the customer's receiving site is as described. Ensure that the proper equipment — in terms of tank configuration, transfer equipment, vapor recovery requirements — is specified. Standardization within the industry on trailer configurations, transfer equipment, and delivery procedures will help everyone.

4. Release equipment prior to completion of lab sampling, at least back to the carrier's terminal. If there is a problem, the driver can be contacted to return to the plant. This will allow better driver and equipment utilization and a better chance for on-time delivery.

5. Look at “short notice to carriers” and “delays in loading/sampling” as part of shipper's quality process. Identify and correct problems with input from carrier. How often does the shipper push the load “outside the window?”

   Other segments of the trucking industry have been successful in charging a premium for last minute or “panic” orders. We look at it as service.

6. Eliminate or minimize preloading and spotting of trailers. Strive for maximum “load and go.” A $65,000 cargo tank is an expensive storage vessel. Loaded and spotted trailers also may be a security concern. In some cases, strategic preloading could benefit both parties if mutual commitments are honored.

7. Allow the carrier to work with shipper and consignee to identify areas for improved efficiency and safety. Let the carrier work directly with the consignee to arrange for delivery times. View the carrier as a team member that can provide reliable service that will increase business for the shipper.

8. Work with carriers in reducing tank-cleaning costs. Top load where possible. Provide technical information for proper cleaning. Let carriers pass on actual tank cleaning costs and take those costs out of the rate. Help carriers and consignees to eliminate or significantly reduce tank trailer heels.

9. Establish long-term, meaningful relationships with carriers. Revert back to real partnerships that promoted problem solving, rather than adversarial relationships.

10. Pay invoices within seven days of receipt. Realize that carriers are relatively small businesses and that delays in payments are impacting carrier cash flow.

Ten ways shippers can help carriers improve safety and security

1. Expand pick-up and delivery windows. Drivers view service windows as so critical to their company's ability to retain business that they are tempted to do whatever is necessary to meet those service requirements. 0800 is prime rush hour time and is the worst time for a driver to take chances to meet a time requirement, especially if he has been driving all night. It is very frustrating to a driver to arrive on time for a pick-up, then have to wait for loading and sampling, or worse, to do whatever is necessary to make a delivery time only to be told “there was no rush for the product.” To improve security, stagger shipping and receiving times to avoid long waits outside of shipper or consignee facilities.

2. Allow adequate time to transit a load. Delays in loading and sampling cannot be made up on the highway without taking risks or violating state and federal regulations. A delay in delivery will be at least the same as delay in departure from the plant.

3. Never introduce nitrogen into a tank without tagging outlets and communicating the use of nitrogen via verbal and written means.

4. Visit consignees to conduct safety surveys to ensure that delivery areas are safe and secure. Realize that drivers are trained to recognize unsafe situations. Do not punish the driver for exercising caution, including not making the delivery until a potentially dangerous situation is remedied.

5. Provide safety information to the driver entering the plant and encourage consignees to do the same. Include evacuation information, emergency signals, location of showers and first aid equipment, plant specific safety regulations. Provide detailed directions to loading or unloading points or to safe parking areas. Information could be on a laminated card that can be returned when a driver leaves the plant. Provide a safety orientation for a driver visiting a plant or facility for the first time.

6. Constantly review and manage procedures for ensuring that the delivery is made to the right tank. Focus engineering on vehicle movement within the plant. Do not rely on the driver to know the customer's plant, tank location, or tank capacities. Plant personnel should escort driver to delivery point and sign delivery instructions. Provide assistance to drivers who must pump into tanks that are not visible from the driver's unloading position to further reduce chance of spill or tank overflow.

7. Provide accurate delivery equipment requirements, including product transfer and total hose length. If vapor recovery will be required, detail what type of trailer equipment or configuration is needed. Improper equipment can result in delays or, worse, jury-rigging that can cause a release.

8. Shipper personnel should seal the trailer and record seal numbers and locations.

9. Incorporate regularly used carriers into production facility safety committees.

10. Do not ask or allow carriers to exceed weight limits.

Ten ways shippers can help carriers attract and retain drivers

1. Expand pick-up and delivery windows. Get the driver in and out of the plant as quickly as possible. Drivers are paid to and want to drive. Drivers work under “hours of service” regulations that limit their driving time. Drivers hate “on duty, not driving.” These regulations will get tougher. Do not classify a load as a “hot load,” unless it really is. Drivers can handle pressure, but get tired of shippers “crying wolf.”

2. Increase rates to allow the carriers to pay drivers a better wage. Understand that — one way or another — the driver is paid percentage of load. As rates are driven down, driver's pay is driven down. But his business and personal costs go up. Pay is the number one reason drivers switch companies or leave the industry. The average chemical tank truck driver makes about $41,000 a year, which is not for a “40-hour home-with-the-kids each night week.” That $41,000 equates to about $13 an hour. Drivers are voting with their feet. They are leaving trucking. The three most important things to help attract and retain quality drivers are: 1. Money 2. Money and 3. Money.

3. Treat drivers as professionals. Teach awareness to plant personnel and to customers of the important role drivers play in the chemical industry. Shippers and carriers should work together to recognize drivers for safe and efficient performance. A sincere ‘attaboy’ travels many miles down the road.

4. Do not pressure a driver to violate safety practices or regulations to protect his company or his job. Allow him proper transit time, including required rest periods. Do not require him to exceed load weight limits.

5. Provide safe and comfortable areas for drivers who must wait to load or for sampling. Visit these areas and determine if they are the types of places that you would want your employees to wait prior to performing a safety-sensitive task. Don't place restrictions on drivers that do not apply to other plant visitors or personnel access to restrooms and phones. How the driver is treated at your facility will affect his demeanor as he enters the highway with your product.

6. Do not make the driver the “scapegoat” in disputes with the carrier or the consignee. If there is a problem with a driver, contact the carrier to resolve it.

7. Tank truck/hazardous materials drivers are under additional pressure since the September 11, 2001, terrorist attacks. Shippers, carriers, and government agencies are placing more requirements on them and monitoring them more closely. A driver may be stopped for roadside inspections several times on the same trip. In some ways, he is viewed either as a potential terrorist or the potential target of terrorism. Ensure that security requirements impacting drivers are productive, not just for show. Shippers should work through the American Chemistry Council to develop an acceptable secondary form of identification.

8. Eliminate or reduce the use of drivers as loaders/unloaders, drummers, and inventory takers. Eliminate or compensate. Try to reduce the amount of paperwork required by the driver.

9. Provide more training assistance and materials for the safe handling of products.

10. Drivers would like to once again be known as Knights of the Road. What can we do to help them regain that noble status?

Ten other areas where shippers can help carriers

1. Help move to the top levels of your company a better awareness of the importance of safe and efficient tank truck transportation to the success of your company. This could help with the rate and the driver situation and perhaps make your job easier and more appreciated. Increase your own knowledge about the bulk trucking business.

2. Place the same requirements on customer pick-up that you place on your carriers.

3. Move away from the “open bidding” process of picking the lowest cost supplier and look at the total value provided. Most hazardous materials tank truck transportation is a specialized service, not a commodity. Top quality service cannot be provided much longer at commodity prices.

4. Do not let the use of third party logistics suppliers reduce communications between the shipper and carrier. Only use 3PLs that understand the special nature of the tank truck industry.

5. Work with carriers to help cover unexpected financial developments such as five-fold increases in insurance premiums. Don't fight surcharge situations as long as possible. There really is an insurance crisis in terms of cost and availability. Stop requiring carriers to sign draconian “hold harmless” and waiver of subrogation provisions as you seek to transfer risk and responsibility to the carrier.

6. New security demands by shippers and the government are placing financial and operational pressures on carriers. You accept the security surcharges airlines are placing on your airline tickets. Security changes are necessary to safeguard shipments, and shippers should be prepared to share the costs.

7. Share production projections with carriers so they can plan driver and equipment schedules. Give carriers as much notice as possible on changes in your business. Create an environment where a carrier can say “no” to a load for safety or economic reasons without fear of being punished by loss of business.

8. Strive to have the headquarters and plant personnel singing from the same page regarding expectations and compensation. Carriers work with both parties and should not be placed in the middle. Be consistent in what is a compensated service and what is a “freebie.”

9. Hazardous materials transportation is much more a service than a commodity. Stop pricing by lanes and inflating volumes, then giving business away to another carrier as a backhaul. Stop relying on “most favored nation” or “meet or release” language in contracts as a way to further beat down rates.

10. Work with carriers that are members of National Tank Truck Carriers. These carriers have made the financial and time investment to keep up with the latest legislative and regulatory developments that impact the tank truck distribution of chemicals and other hazardous materials. They work through NTTC to try to influence those developments. They are involved in the safety and operational activities of NTTC and organizations such as the American Chemistry Council to make bulk distribution safer and more efficient. They support an organization that works to portray tank truck transportation of products essential to the economy in the best way to the government, public and media. NTTC members are involved in helping the entire tank truck distribution chain — shippers, carriers, and consignees. If carriers that you are using are not NTTC members, ask them where else they are cutting corners.