How should we pay our truck drivers? By the mile, the hour, the load, or the-ton?
This was a question from a webinar we presented last fall. Others have asked it too. It’s such a great question because you want to pay your drivers fairly and each method has its own advantages. The most recent trends have some trucking companies going to hourly for OTR which was unheard of a decade ago. But the answer is not universal to everyone.
My advice to you is to pay in the way that makes the most sense and is the easiest to understand for your drivers. Ultimately, you’ll be paying market rate for the work the truck drivers perform so if the pay ends up being $1200, let’s not worry about by the mile/ton etc..
If you can make it easy to understand and list it on the pay stub and you still don’t know what to do I would suggest looking at it two ways. The first way is what rewards the truck driver when we are more financially successful. In other words, how do you invoice for the work? If you invoice your customer by the ton and can show the driver how he or she was paid by the ton then you are good there.
The important things are that you are clear with the driver how they are paid and that you show them your work when you pay them so they can see it too.
The second idea is to ask your drivers what makes the most sense to them or better put, how do they want to get paid. Of course the answer is “more”. But for the same money, do they have a preference? Even if it may not be the way you’d pick to pay them, the benefits of talking to them about it and the drivers knowing they were heard has more value to your truck driver retention than what unit of measure you pay by anyway.
What do you think about this? Please contact us below to share your thoughts.
Written by Mike Ritzema
With over 20 years of experience in entrepreneurship, management, business planning, financial analysis, software engineering, operations, and decision analysis, Mike has the breadth and depth of experience needed to quickly understand entrepreneurs’ businesses and craft the most suitable solutions.
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