One idea to recruit and retain truck drivers that will separate you from the rest.
Finding and hiring qualified truck drivers is hard. It takes effort and new ideas to find the people that keep your equipment earning money for you. Sometimes, it means trying things you wouldn’t normally think about. Trying new ideas that you hadn’t previously considered. Payroll frequency is one of those things.
What if you paid the drivers twice or more per week? Would the drivers like that? Would that make drivers want to stay with you longer? There are a lot of ways to accomplish this but there are benefits to your trucking company as well.
Let’s start with one easy way to do this (There are others like full payroll on demand that. We can help with too but this one is easier). If payday is Friday, consider depositing $300 into their bank accounts on Tuesday. You could recover that money on Friday from their pay. It is almost like an advance every week with the payback three days later. What are the effects of paying the drivers more often for both the driver and then for you?
The driver has some money in their pocket. That money will make their lives a little easier, makes them less likely to look for another trucking company to drive for.
For the company, paying more often will lower driver turnover and can be a recruiting tool. It will also encourage drivers to turn in bills more quickly to get that mid-week payment. Faster bills mean faster invoicing and the trucking company gets paid sooner. The increased driver retention means that your trucks are full and earning money instead of parked. The only costs are the cash flow of the mid-week pay.
I have heard the argument that the trucking company is doing a disservice to the driver by paying faster. They claim it allows the driver to be bad at personal money management. I think that idea has some issues. First, it is not the employer’s job to manage the driver’s personal money. If it is was their job, they’d offer personal finance classes to the drivers and really promote it. Second, would you rather offer pay more frequently or lose a driver to somewhere else that does. Finally, many people that live day to day financially end up doing other things like payday loans or credit cards while they waiting for payday. That costs them way more than any value of waiting three more days for their pay.
It is money the company will owe the truck driver anyway so why not pay it sooner.
Many companies outside of trucking, like McDonalds and Wal-Mart offer early day pay any time. The term for this is Earned Wage Access. It really hasn’t taken off yet in trucking but I expect it to gain some footing soon as drivers are getting harder to find. Why not get in front of it and offer it before your competitors? What are your thoughts about paying more often? Contact us and share what you think.
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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