Fleet Issues Update
July 1, 2007
Fleet Issues Update
By Earl Eisenhart
Pending transportation developments could affect snack company fleet operations.
SFA Transportation Consultant
Several important transportation-related issues are being considered in Washington, D.C., and the outcome will directly affect the cost of fleet operations for many Snack Food Association members. Here’s an update:
Fair Labor Standards Act — Motor Carrier Exemption
When Congress passed the Safe, Accountable, Flexible and Efficient Transportation Equity Act (SAFETEA-LU) in 2005, there was an error in drafting that inadvertently provided a new right to overtime pay to thousands of drivers operating commercial motor vehicles under 10,001 lbs.
A longstanding exemption from the Fair Labor Standards Act for “any employee with respect to whom the Secretary of Transportation has the power to establish qualifications and maximum hours of service” was repealed. As a result, many employees previously covered by DOT regulation now are subject to U.S. Department of Labor regulation under the FLSA and eligible for overtime pay.
This means that businesses of all sizes have been exposed to millions of dollars in lawsuits for overtime pay dating back to August 10, 2005, when SAFETEA-LU was signed into law. The SFA is leading a coalition of groups seeking to restore the motor carrier exemption through corrective legislation.
Driver Hours of Service — Outcome of Litigation
The U.S. Circuit Court of Appeals for the District of Columbia is expected to rule soon on several petitions seeking to revise the Federal Motor Carrier Safety Administration’s (FMCSA) hours of service rules.
Both safety advocacy groups and the Owner-Operators Independent Drivers Association (OOIDA) have petitioned the court for review, albeit for different reasons.
Safety groups argue that the agency devoted insufficient attention to a driver’s “time on task” and told the court the extra (11th) hour of driving time per tour of duty and the 34-hour “restart” provisions are detrimental to safety and should be dropped from the rule.
OOIDA seeks revisions to the sleeper-berth provision, which requires drivers to take a minimum of eight consecutive hours off in the sleeper berth and an additional minimum of two hours off duty. OOIDA would like to return to a regime that permits team drivers to “split” their off-duty time into more flexible segments and allow solo drivers to count the two-hour portion of the requirement “against the clock.”
If the court agrees on any of these points, it may send the rule back for redrafting. If so, a new rule is likely to be more restrictive, resulting in further appeals to Congress.
Electronic On-Board Recorders for HOS Compliance
A Notice of Proposed Rulemaking on the use of Electronic On-Board Recorders (EOBRs) was published in December 2006 and would require EOBRs only for carriers with a “demonstrated history” of “serious” hours of service violations. These are carriers charged with two serious violations in a two-year period (rate of violation greater than 10%) as a result of compliance reviews.
The proposed rule also would establish performance criteria for the use of the equipment to support HOS compliance. The devices would need to record basic information required to track a driver’s duty status, including the driver’s identity, date, time and location of the vehicle, and distance traveled, and would have to be used in conjunction with GPS or other location tracking systems.
The proposal also encourages voluntary use by providing enforcement incentives, including auditor examination of a random sample of drivers’ records of duty status and a partial waiver of supporting document requirements.
The agency requested public comment on other incentives for EOBR adoption “including whether the time savings that drivers are likely to achieve from EOBR use … would provide a sufficient basis for the agency to allow drivers using the devices to extend their 14-hour driving window …”
The proposed rule has been derided by safety advocacy organizations, which have long sought a universal EOBR mandate, and has also received skeptical treatment on Capitol Hill, where legislation requiring a broader EOBR mandate may soon be introduced.
Medical Review Board
The focus of the board’s recent deliberations has been on the agency’s treatment of Schedule II drugs for purposes of the medical certification rules, including certain narcotic, stimulant, and depressant substances. Commonly used examples include oxycodone (Percodan), methylphenidate (Ritalin), and dextroamphetamine (Dexedrine). Schedule II drugs are considered to have a “high risk” for abuse, but also to have “safe and accepted medical uses.”
Current rules prohibit a driver’s on-duty use of Schedule I drugs (LSD, marijuana, heroin), as well as other narcotics, amphetamines and “any other substance, to a degree which renders the driver incapable of safely operating a motor vehicle.” However, there is an exemption for non-Schedule I substances if “administered to a driver by or under the instructions of a licensed medical practitioner.”
The “Schedule II Medications Expert Panel,” which is advising the Board, has recommended that the exception be eliminated and that random and post-accident testing be expanded to include a broader range of drugs. The recommendation is based on the panel’s “clinical experience and judgment,” which finds that Schedule II drugs are frequently abused or misused or inappropriately prescribed.
Driver Training Rule
The Federal Motor Carrier Safety Adminstration (FMCSA) has begun preparing a new entry-level driver training rule that is expected to be significantly more comprehensive and expensive than current requirements. The effort comes in response to a December 2, 2005, federal appellate court decision that said FMCSA “largely ignored” its own data and recommendations on the need for comprehensive operational skills training.
These include a 1995 report asserting that on-the-road schooling is a critical component of an entry-level training regimen and a “Model Curriculum” published in 1985, which prescribes a 320-hour training program, including 116 hours of on-the-road training and 92.25 additional hours of driving-range time as a minimum requirement.
The court said the agency “simply disregarded the volumes of evidence that extensive, on-street training enhances CMV [commercial motor vehicle] training.”
The Final Rule at issue was published May 21, 2004, and requires that employers perform classroom-only training of new drivers in four areas: driver qualifications (including medical examination procedures and qualifications such as vision, hearing and hypertension standards); hours of service (including causes of fatigue and how to keep a daily log); driver wellness (including diet, cholesterol and blood pressure); and whistleblower protection.
The regulation was found by the court to have “little apparent connection to the [driver training] inadequacies it purports to address.” None of the four areas covered by the rule “has anything to do with operational skills.”
Unified Carrier Register
Private truck fleets will pay new fees each year under a new registration scheme developed jointly by the states and the FMCSA.
As a part of the 2005 SAFETEA-LU bill, Congress repealed the Single State Registration System (SSRS) and created a “replacement fee system requiring private motor carriers to register and pay fees to a “base state.”
Thirty-eight states participated in SSRS, which they used to generate revenues for a variety of purposes. For years, large interstate for-hire carriers have complained about the program’s costs and lack of apparent merit, given that it largely duplicates federal requirements.
By including private motor carriers, brokers, freight forwarders, leasing companies, and exempt for-hire motor carriers in the Unified Carrier Register Agreement, Congress effectively lowered the registration costs for large for-hire motor carriers while ensuring that SSRS states remain “whole” with respect to program revenues. (SAFETEA-LU also provides a minimum apportionment of revenues under the program to non-participating states.)
This represents the first time private fleets will be required to register, file evidence of financial responsibility, and pay fees under this type of program, which could reach as high as $40,000 per year for the largest fleets.
The UCR board of directors has for the past months been deliberating the rules of procedure to govern the fees system and the amount of annual fees to be assessed to various categories of fleets, depending on number of vehicles.
The new program was expected to begin January 1, 2007, but unanticipated technical and policy issues have resulted in delays. It now is expected to be initiated later this year. FMCSA recently announced it is drafting an NPRM to establish the fees under an expedited rulemaking.
Diesel Fuel Standards
The energy bill moving through Congress contains provisions requiring fuel economy standards for diesel trucks above 10,000 lbs. This would be the first time such a standard would be applied to these vehicles and would significantly increase costs to purchasers.
While the obligation for meeting the standard would fall on engine manufacturers, the SFA is closely monitoring this legislation and working with allied industry groups on behalf of its members.