Tag Archives: strike

North America Trucking Update

As you are most likely aware, the transportation and logistics industry is in the midst of a very challenging time due to truck power shortages.   This correspondence is our effort to provide you with information as to why this is occurring, what the specific and immediate challenges are, and how you can anticipate the effect on your business.

First and foremost, it is important to know that this is an entire industry wide issue.  The truck power shortage is impacting all steamship lines.  We are doing our best to make the difficulties seamless to our customers; however that is becoming less and less possible.  The specific issues resulted by the “truck power shortage” are as follows:

1.  Driver shortages:  In the past two years a high percentage of drivers have exited the intermodal drayage industry for other more profitable moves.  This is due to stricter government regulations associated with reduced drive times behind the wheel and the increased costs and certification necessary to handle hazardous materials over the road. Expanding on the reduction of hours a truck driver is allowed behind the wheel. Drivers are limited to 11 hours behind the wheel.  Prior to the regulation, typically drivers would travel 200 miles and make two moves per day.  Now, they can generally only make one per day, especially given the more often than not delays at the port or rail terminal.

2.  Congestion at most of the infrastructures: The volumes into the rail and port terminals across North America have significantly increased of late and are anticipated to remain high for the foreseeable future.  This reduction in fluidity makes it more difficult for the industry to secure sufficient truckers as well as chassis.  As congestion increases in all aspect of the movement of Intermodal traffic, this limits the amount of turns a driver can make, lowering his salary per week.

This inability to turn units effectively will obviously impact costs.

3.  Safety regulations:  As mentioned in point 1, the government regulation of the trucking industry has intensified in the last several years.  One direct link to trucker availability issues is the increased cost truckers and their companies have to pay in order to handle hazardous loads.  Drivers, as well at their companies, are required to pay higher insurance premiums as well as be certified to handle these moves.  The premiums for both have increase by more than 30% the past several years.

Our goal remains the same, to provide our customers with safe quality service. At this time, however, due to the challenges within the industry, we find it only prudent to inform you that you may need to expect potential delivery delays and the costs associated with those delays.  It may also be necessary for us to make rate adjustments in order to satisfy commercial service commitments.

We appreciate your patience during this time and want you to know that we will continue to work as diligently as possible to deliver cargo as quickly as possible.

California truck drivers go on strike

California truck drivers at three major transportation companies went on strike Monday morning, demanding an end to purported labor law violations such as misclassification and intimidation. This is the fourth strike initiated by the drivers with the backing of the Teamsters union, but it’s the first without a definitive end date; whereas previous strikes have lasted between 24 and 48 hours, the drivers are now saying the won’t return to work until their demands are met. “We were fed up. It just got to the point where the drivers are done,” said Alex Paz, a former driver with TTSI, one of the three firms affected by the strikes. Paz, who was fired in late May, alleges that the firm retaliated against him after he spoke out regarding purported labor law violations.

Over 120 drivers will be going on strike at the ports of Los Angeles and Long Beach, two of the main supply arteries on the West Coast. Roughly 40% of all imports to the United States go through one of those two ports. The firms affected by the strike are responsible for shipping goods to major retailers such as Walmart and Target. The National Labor Relations Board filed a complaint against one of those firms, Green Fleet Systems, in late June over allegations of intimidation and wrongful termination. But even more so than those charges, the key issue at stake in this dispute is alleged misclassification. The three firms affected by the strike – Green Fleet, TTSI, and Pacific 9 Transportation – classify their drivers as independent contractors instead of employees, meaning they don’t have to pay various benefits. “When the company misclassifies you, you’re denied Social Security, you’re denied medical, you’re denied workers comp,” said Paz. He and the other strikers argue that they should legally be classified as employees, which would entitle them to those benefits and allow them to unionize.

Misclassification is endemic to the port trucking industry, according to a joint report [PDF] from the National Employment Law Project (NELP), the Los Angeles Alliance for a New Economy (LAANE), and the labor union coalition Change to Win. They claim that about 65% of the nation’s port truck drivers are misclassified by their employers, costing those drivers a collective $1.4 billion annually.