What to do to hire an Owner Operator?

Well since you have solicited the customer I believe a fair wage would be 75% of 100% if he pulls your trailer and 85% of 100% if he pulls his trailer. Your authority he pays insurance plates you pay ifta drug testing the minor things. I'm in the process of figuring this out myself. Show the o/o what you are billing the customer when/if he asks since he's on percentage. And make sure everything adds up for it. Being that you own a company you understand what he has to pay for. Don't screw him but don't screw yourself. In my eyes that's fair.

 

If only more companies followed your advice.

 

What exactly are you asking about? An O/O with his own truck, or leasing him/her one of your trucks?

Simply state what the load pays.
If you have enough work to lease the truck on to your authority it will be cheaper for you. But with more risk for you.
You should have no start up cost for an O/O. He already has his truck with plates and insurance, IFTA, DOT#, NYSHUT ready to work. Or hes not an O/O.
When You lease an O/O on to your authority, your cargo insurance covers the load on his truck. This is worth some money because cargo insurance is not cheap.

 

And that right there brings back the age old argument of what an O/O is. When a driver LEASES ON they are an INDEPENDENT CONTRACTOR when a driver has their OWN AUTHOIRTY they are an O/O, when they have their OWN AUTHORITY and more than ONE truck they are a SMALL FLEET and when a driver LEASES A TRUCK FROM A COMPANY THEY'RE A LEASE OPERATOR. To many people use O/O loosely. I realize I used it earlier talking about leasing a truck on.

Only problem with bringing an O/O on is cargo insurance there's always this that or the other that a company can find wrong. Brokers don't care but every company I've called has given me a cargo ins. Excuse or some b.s. mainly because they don't want to pay me a fair wage I suppose.

 

If you hire an independant contractor,having his own authority, he should also have the cargo insurance. This type should be getting the best pay, as he is the one with all the risk. You would have very little risk with this type. You should be more apprehesive hiring an O/O or lease driver as they put the risk on your safty rating and your authority. Also an independant is better for spotty work as he would be pulling other broker freight. But leaseing on an O/O, you may not have to pay quite as much, but your providing a lot more and he would expect nonstop work.

 

Independent contractor is one who is contracted to do specific work - a driver to drive one of your trucks. You will have to treat this as almost an employee, following the hiring regulations per the FMCSA.

If they have their own truck, they (truck and driver) are leased to your company under your authority. You will have to treat this as almost an employee, following the hiring regulations per the FMCSA in addition to having the truck as part of your fleet and you pick up the cargo insurance, this is because it is your authority.

IF they have their own authority, then you contract with them as a carrier, not as an independent contractor.

Negotiate the rate based on what your gross charges to the customer, I think as mentioned 75% of the line haul plus 100/% of the FSC is a fair amount.

 

There are a number of variables you need to take into consideration and some of them have been mentioned above. I'm sure you're still not sure what to do based off of just this thread. My recommendation is talk to someone that can explain your options and the consequences of those options. If you're a member of your state trucking association, NASTC, or any other similar organization give them a call. If you're a member of more than one then call all of them and then find a reason for any conflicting opinions so you understand the issues so you can decide what's best for you and your operation.

If you're not a member of any trucking organization that can help you and you don't have any trucking business colleagues to reach out to then I suggest calling your state trucking association. In your case that's http://www.iltrucking.org/contact.html You'll probably have to join to get help, but that's only fair anyway. (It's not a government agency.)

If you want to talk to a consultant, try Ahern & Associates. (602) 242-1030 http://www.ahern-ltd.com/

You might also consider talking to a lawyer that specializes in motor carrier law. If you don't have one already you could try The Law Office of Seaton & Husk http://www.transportationlaw.net/contact.html

Since there is so much you don't know you shouldn't expect it to be covered in this forum in a way that you'll understand with confidence. What I mean by that is someone could give you an answer here, but you won't have a full understanding of the issues so you wouldn't know if it's the right answer for you or your operation.

A lot of ground can be covered more quickly in a conversation though. That's why I recommend calling one of the resources I mentioned above. If I were you I'd call the Illinois Trucking Association.