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What’s a reasonable rate to pay a CDL driver?
Discussion in 'Car Hauler and Auto Carrier Trucking Forum' started by Atlanticus trucking, Jan 3, 2019.
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1. Does he run under under my dot number or his?
2. Is the insurance under his company or mine? Truck is his trailer would be mine.
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Typically in these situations the tractor owner leases onto the motor carrier. The motor carrier by law is responsible for the cargo and public liability insurance, the truck owner pays for their non-trucking (bobtail) and physical damage (collision) insurance. Usually the motor carrier provides a base plate, IFTA and all operating permits. These can be charged back to the truck owner if your agreement allows. You can also charge actual costs for insurance, although many carriers simply include this in the base rate they pay the driver, making 70% a decent rate if you cover these expenses.
For your operation trailer ownership is slightly higher than the average dry van freight company so I think you are fair at 70%.
Other things to consider when leasing on an owner operator. From the FMCSA perspective a leased operator is the same as an employee driver meaning you must complete an employment application, background verification and place them in your drug testing pool, same as you would for an employee driver. Also, as the operating motor carrier you are legally liable for their truck, any violations occured and the actions of the driver while under dispatch -same as if it were a company owned truck with an employee driver. This includes maintaining a vehicle file with proof of service, repairs and inspections.
Lastly, in either case your authority or his, as an owner operator you would 1099 him and he would remain responsible for the upkeep and repairs on his own tractor. Fuel and tolls are between the two of you, typically the truck owner pays fuel and tolls with any fuel surcharge going to them 100%.Atlanticus trucking Thanks this. -
As already stated by other posters here if you let him run under your DOT (your DOT number displayed on his truck) you must add his truck and list him as a driver to your insurance policy, get him to do a pre-employment drug screen, add him to a random drug testing consortium, start and maintain a driver file for him, start and maintain a vehicle file for his truck, start and maintain a trailer file for your trailer. You (or whoever manages drivers) must complete a course called 'reasonable suspicion drug testing training' this can be done online and you will get a certificate after completing the course.
If he runs under his DOT then you would need to add 'broker' authority to your existing DOT authority, you can do this online at the FMCSA website there will be a $300 application fee but the kicker is you need $75,000 'broker' bond which will probably cost you $750 per year.Atlanticus trucking Thanks this. -
Also when we are talking about him using his authority, are we referring to him using his MC number? Meaning in order for him to use his own, he would need both a DOT and MC number?
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Yes, for him to use his own authority he would need a US DOT and MC number, meaning he wouldn't really need you. He would have to do everything you do to own a trucking company so all your value would be is as a broker, maybe 5-10% of the load. He would have the astronomical insurance among other liabilities.
So yes, if he runs under his own authority then he would be fully responsible for everything. This also means he can pull his own loads off the boards, haul for other customers and steal your customers! He would only be responsible to you for whatever the trailer rental and maintenance amount is when he is hauling his own work.
Also, if he were under his own numbers he would need to have trailer interchange insurance specifically declaring your trailer and it's value so that you are covered in the event of a loss. Under your number it is your insurance so the trailer will be covered anyway. -
With the typical leased on O/O you would be responsible for everything any DOT violations or OOS will be on your company record, if he does something wrong he can just washes his hands and go lease on with another company.
Either way I would recommend to install a GPS tracker on your trailer, I use the one below.
FLEET WATERPROOF TRACKING DEVICE - GPS Tracking
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