Drivers Inc.

Michael Ludwig

Well-Known Member
20
There working on getting Driver Inc shutdown, and now there pretending there in Alberta or Nova Scotia setting up a dummy address and running it out of Ontario so there skirting the system another way now.
I hadn't heard that "Driver Inc." was doing that, but carriers whose safety records are so poor they can only acquire facility insurance are trying to set up offices outside of Ontario while the vast majority, if not all, of their business remains in Ontario.
 

Shakey

Site Supporter
30
There working on getting Driver Inc shutdown, and now there pretending there in Alberta or Nova Scotia setting up a dummy address and running it out of Ontario so there skirting the system another way now.
criminal/cheaters are always a step ahead, I'm sure they are working on their next play as the Driver Inc model is shut down
 

tasuinam

Active Member
10
There wouldn't be any legislation that says that because it is a recognised business model.
The problem with it is that there is no mechanism to ensure that people operating under that model actually do pay their taxes and such.
I remember when I used to freelance as a writer many moons ago - I charged GST and that is how my income got tracked - wouldn't that be similar - but I think i only had to do that if it was over $30,000 or something
 

Jim L

Well-Known Member
30
The only way that Driver Inc. is going to diminish or be shut down will be through more enforcement. The CRA absolutely needs to do more financial audits to identify catch the cheaters out there. Currently there is zero enforcement so companies whose margins are being squeezed are emboldened to try models that might get them slightly ahead. A financial audit will point CRA to look at their suppliers and identify if other incorporated companies are reporting their income properly. Like @Michael Ludwig said, the model is legit until someone uses it to skirt paying their fair share of taxes by not reporting their income.

Becareful what you ask for. If we ask the government to create a process to weed out Driver Inc and other tax evaders, we might get stuck with a similar process that they have in the US were we have to submit a form every year to the government where every dollar of our expenses were paid to. That will require us to incur much more overhead in obtaining tax id's, reconciling our records and other government bureaucracy.

Our best option is self-governance. We need to do our due diligence and not hire under this process. If the driver does not come with their own truck then they are an employee and should be paid as such. If they come with a truck and pay all their own expenses then they are an Owner Operator and can be paid that way. In my experience I have only had 2 drivers who applied to become a driver and refused unless we paid Driver Inc. They don't work here. On the other hand, I have had a number of drivers who would not work unless paid under a payroll system because they have been burned at the last place they worked.

Say no to Driver Inc.
 

Igor Galanter

Well-Known Member
20

In the US - so maybe coming here too?
Sound like there should be a two new definitions of O/O's..
1- independent O/O, self explanatory, I think..
2- contracted O/O, kinda self explanatory too..

Happy Friday, all!
 

loaders

Site Supporter
30
I am certain they are still out there, but are there really many actual, independent owner operators left? When I started in this business there seemed to be a good number of truly independent, one truck guys who would do one trip for me, and then another trip for someone else tomorrow. Could their declining numbers be attributed to ever increasing regulatory burdens, liability insurance availability, or a reluctance on the part of shippers and brokers alike to conduct business with “one man shows”? Attaching yourself to a well run trucking company, provided the compensation is adequate, would seem like an easier way to go than juggling all of the hassles of being an independent, in addition to doing the actual driving.
 

Igor Galanter

Well-Known Member
20
I am certain they are still out there, but are there really many actual, independent owner operators left? When I started in this business there seemed to be a good number of truly independent, one truck guys who would do one trip for me, and then another trip for someone else tomorrow. Could their declining numbers be attributed to ever increasing regulatory burdens, liability insurance availability, or a reluctance on the part of shippers and brokers alike to conduct business with “one man shows”? Attaching yourself to a well run trucking company, provided the compensation is adequate, would seem like an easier way to go than juggling all of the hassles of being an independent, in addition to doing the actual driving.
I hope I'm not a dying breed, eh..
Mr. loaders, agree with you...
 

artmax

New Member
2
Very difficult to run a employee only carrier in a market where Canadian brokers with "26 years of experience" offer 750cad on 500 miles quoting "cheap clients & tough market" (*Cough* Looking at brokers in this forum/website *cough*).

If you want to fix the problem; think upstream.
The problem that actual brokers give away loads to carriers that resell them further down the line; I can only imagine how secure your supply chain is; when the freight you '"co-broker" (willingly or through feigned ignorance) is sold to the lowest bidder on the community bazaar. You have the tools to amend this situation; similar to how the consumer has purchase power.

I know the game is unfair and unbalanced; as much as I want a referee to dictate the rules we must try to uphold a standard within this working community, because if rules are not followed without a judge; they won't be followed with one. There's a finite amount of meat on the bones; we cannot be bringing in plates for those who don't add to the table.
 

Michael Ludwig

Well-Known Member
20
The only way that Driver Inc. is going to diminish or be shut down will be through more enforcement. The CRA absolutely needs to do more financial audits to identify catch the cheaters out there. Currently there is zero enforcement so companies whose margins are being squeezed are emboldened to try models that might get them slightly ahead. A financial audit will point CRA to look at their suppliers and identify if other incorporated companies are reporting their income properly. Like @Michael Ludwig said, the model is legit until someone uses it to skirt paying their fair share of taxes by not reporting their income.

Be careful what you ask for. If we ask the government to create a process to weed out Driver Inc and other tax evaders, we might get stuck with a similar process that they have in the US were we have to submit a form every year to the government where every dollar of our expenses were paid to. That will require us to incur much more overhead in obtaining tax id's, reconciling our records and other government bureaucracy.

Our best option is self-governance. We need to do our due diligence and not hire under this process. If the driver does not come with their own truck then they are an employee and should be paid as such. If they come with a truck and pay all their own expenses then they are an Owner Operator and can be paid that way. In my experience I have only had 2 drivers who applied to become a driver and refused unless we paid Driver Inc. They don't work here. On the other hand, I have had a number of drivers who would not work unless paid under a payroll system because they have been burned at the last place they worked.

Say no to Driver Inc.
And it gets worse ...
California's AB 5 stems from, and is targeted directly at, Driver Inc.
AB 5 is like killing a flea with a sledge hammer ... the downside is you're going to kill the dog too.
If AB 5 goes through, and it is very likely to, it will become a model for all states and provinces to follow.
It won't be very long before governments figure out just how much tax they are actually missing out on, and money talks. It's voice is loud and clear.
Carriers are well advised to understand AB 5. It's coming to a state or province near you and sooner rather than later.
Even if an AB 5 type law does not come to Ontario, but does come to Michigan for instance, and 35% of your work is done in Michigan, the AB 5 type law will pertain you, and it does not matter that you are based in Ontario.
The only real hope for AB 5 to be thrown out is the U.S. Supreme Court because there are diverging views between the 1st Circuit Court and the 9th Circuit Court. Regardless, the IRS is now weighing in on the subject so it is fair to say that some semblance of AB 5 will survive regardless of the Supreme Court rulings, even if it is clearer IRS rules and stepped up enforcement of said rules.
The long and short of it is, no matter what happens, Driver Inc. is on its death bed in the United States. It is not a huge leap to extrapolate that a similar version will come to Canada.
 
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