Avoid Marten Transport LTD.

Guys like this that give Drivers a bad name.

 

Actually, Marten does not force Per Diem. It is an option. My husband works for Marten and does not do per diem.

 

This is true for older hands at Marten, Pine, but new hires, like myself, do not have an option on per diem. It's mandatory.

Not trying to be combative, but anybody looking to work for Marten needs to know that Per Diem is mandatory for an indefinite period at time of posting.

 

Marten has been self insured since 1996 when I first went to work for them and was before that so I'm asking what has taken you guys so long to figure it out? Do you ever read the annual stock holders report and financil statements? If you did you would have found out this a long time ago!!!!
PS: Guess why I'm still not there?

 

Hadn't heard of that. My husband has been with Marten for a year. How new are you at Marten?

 

NEW...as in I go to orientation on Tuesday.

I asked when I was able to opt out of per diem, just for knowledge sake, and the recruiter said is was mandatory indefinitely (for newbies).

 

I have to agree here.

I've run the actual numbers many times, and have been on the phone with payroll more than a few times about this one. This is my first full year on the per diem payroll scheme, and no matter how I run the numbers, I'm losing money in a number of ways.

The first, and most immediate effect, is that my "pre-per diem" base rate is actually $0.025/mile LOWER, because of this "fee" I'm being charged to "process the per diem" (which is actually processed by a computer program). This amounts to a defacto pay cut, which ISN'T mentioned on Marten's web site, btw. Here's how it breaks down for me...

Base Rate is supposed to be $0.395/mile. Marten is actually taking back $0.165/mile taxable, and then giving me back $0.14/mile untaxable, effectively reducing my base rate to $0.37/mile. My average miles per week is roughly 2,300 right now (for this quarter), which means my actual gross pay before all tax schemes is down $57.50, $7.23 more than what I am supposedly "saving" by not paying as much immediately in taxes.

I stay out an average of 325 days per year (I don't take all the earned home time right now because of the crappy economy). My per diem pay is on average is $322/week. However, if I were not on this plan, I could deduct $364/week at the end of the year, so I'm losing $42/week this way as well.

The two factors above mean I'm losing $99.50, or just under $4,800 per year. But, this isn't the only way I'm losing money.

Because only paying taxes on $0.23/mile, my actual taxable pay is down over 30%. This means my Social Security benefits if and when I retire will also be reduced over 30%. If I get laid off right now, my Unemployment Insurance benefits are reduced over 30% as well. If I get hurt on the job and can't work for a few months, my Workmans Compensation is also reduced over 30%. In fact, any and all payments keyed to my taxable earnings are reduced over 30%, including my 401k!

This on top of the effective pay cut.

And there are other consequences as well. Credit worthiness is based in large part on TAXABLE income, and the per diem is not allowed by most lenders to be considered (since they have no way to prove it's really income, because under tax rules, it isn't). The 30% drop in taxable income has resulted in a 100 point drop in my credit rating. I can no longer even be considered for a secured credit card, let alone think about buying a car or home, this despite over a decade of working hard to rebuild my credit after getting into tax trouble some years back.

Who saves on this plan? The employer! Aside from the defacto across the board pay cut, they save on all those taxes and insurance premiums keyed to how much I earn. This includes Social Security, Medicare, Unemployment Insurance (both state and federal), Workmans Compensation, certain state disability insurance programs, etc. On top of that, the employer gets to take your per diem deduction you would have received had you not been on their per diem payroll scheme. Take how much I'm losing, and multiply it by roughly 2,000 drivers, and you have the approximate amount the employer is saving under this scheme.

BTW, for those who "live" out of their trucks (no fixed place of residence), if you are on this plan, you are screwed. Unless you can cough up receipts for rent or mortgage payments for the entire calendar year on a fixed residence, you are potentially liable for ALL taxes (including employer) on the full amount of the per diem, plus interest and any assessed penalties, if you are audited. This will usually be at least the amount of per diem you received, almost always a lot more.

This is a lose-lose proposition for drivers, and a win-win for companies. Marten does not "force" drivers to participate in the per diem scheme, but from what I've heard from drivers not on it, they apply significant pressure through the fleet managers to get you to enroll, bordering on the coercive (one driver told me he gets messages several times a week over the qcomm insisting he enroll). This should be a clue as to how bad this plan is for drivers, and how profitable it is for Marten.

 

Nice post Ca Mw,
I guess this atleast partially explains Martens good financial numbers lately.
They charge you for the privilege of losing money.

The thing that is most disturbing is you know Marten's accountants ran the numbers just like you did.They knew beforehand that it was not to the drivers benefit.Yet they still try to, not force,but CONVINCE them to take it.
Would it not have been better to come right out and say look times are tough we gotta drop pay by .01cpm?

 

I just confirmed with payroll that Marten is making the per diem plan mandatory for all company drivers, regardless of how long with Marten. While questionable at best, it is legal, according to the IRS (just got off the phone with them, too).

BTW, the same IRS agent said the $0.025/mile Marten is charging to "process the per diem" may be deductable for the driver as an unreimbursed business expense. Just have your tax guru prepare the appropriate Form 1099, based on the information on your payroll statements (these show your actual paid miles).

This type of payroll scheme appears to be going industry-wide (and is gaining interest in other industries as well), so changing companies won't solve the problem. With the glut on drivers right now, even once honest and fair employers are finding new ways to screw drivers out of their hard earned money.

 

Well, many large employers are adopting this particular scheme as well. There is huge money in forcing people to pay or die. Funny thing with Marten, though. I've never had such low insurance rates, and they are the first insurer to allow pre-existing conditions. How long they stay low, I don't know (especially given what I've learned about the per diem plan). But, as long as they are lower, I'll pay the premiums. If someone else can give me the same or better for a lower price, I'll go with them. Just business when it comes to health coverage, and the choice is quite literally, pay or die.