Fuel Surcharge

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Tramp1947

Member
Jun 3, 2011
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Does anyone know if it is illegal or just a money maker when a Broker / Company takes a percentage of the fuel surcharge?
If Illegal what is needed to recoup the amount?
If not illegal then what ? Just post them as greedy?

Thanks
 
It's not illegal ... but there is no such thing as a governed fuel surcharge either. Whether asset or non-asset based, it's common practice to be creative with the FSC whether it's the customer creating their own schedule of what they pay or the carrier, and based on what types of scenarios. What I find in aggregate is that when fuel goes up, the FSC that the shipper pays to either carrier or broker and what the broker pays to its carrier partners are more or less the same -- maybe sometimes at an advantage at one end, disadvantage at the other. Micromanaging it per transaction doesn't work too well.
 
So it's not illegal or even bad business? HHHMMMM confusing.. Why they bother doing things that way instead of just saying this is the rate PERIOD.. But maybe that's why I'm still a one truck O/O after al these years..
Thanks theman
 
If a company is taking a % of the FSC from an O/O I would check on what else they are taking from you because in my opinion the FSC is for the truck and it should be 100%, I would be checking all the other deductions.
 
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I think Tramp needs to ask a specific question. Was he short paid? Or is he saying the other party is billing for FSC and not paying him the same amount? The actual issue at question is vague on this thread.
PR
 
Sorry about the vagueness PackRat.

For the past 4 1/2 yrs I have been hauling for one carrier. Running under my own auth., Ins, plates and CVOR. I have been paying them a percentage for them to find the loads and they have been loading me as if I were a FULL company O/O.. There are a few of their clients that pay a FSC. and a few more who pay waiting time.
MY QUESTION WAS.. Does the company have the legal rite to that that percentage of the FSC and the waiting time??

Hopefully that clears it as clear as mud .
Thanks
Tramp
 
Tramp1947 said:
Sorry about the vagueness PackRat.

For the past 4 1/2 yrs I have been hauling for one carrier. Running under my own auth., Ins, plates and CVOR. I have been paying them a percentage for them to find the loads and they have been loading me as if I were a FULL company O/O.. There are a few of their clients that pay a FSC. and a few more who pay waiting time.
MY QUESTION WAS.. Does the company have the legal rite to that that percentage of the FSC and the waiting time??

Hopefully that clears it as clear as mud .
Thanks
Tramp
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Do you have a negotiated contract? If you are being paid a percentage of the rate then there should be some concise wording in the contract that identifies how you should be paid. If it is not in there it may be time to re-negotiate and make sure that those items are defined and itemized. You also want to make sure your contract allows you to review the receipts for the loads you haul keeping in mind that some places may send invoices outside of the linehaul invoice for items like FSC and detention. (Some auto customers need you to send an invoice to one place for the linehaul and another place for detention).

For the most part, the only legal part is the contract and how far you want to go to enforce the contract.
 
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All good replies below. Another argument the carrier can make is that the customer would not accept an increase in the base rate but would however allow a fuel surcharge or an increase to the existing fuel surcharge. The carrier would then consider this part of the base rate for payment purposes to the owner operator and would expect to keep a portion of it.
 
Thanks to all.
There never has been a negotiated contract. For me it was just broker/ O/O working towards a common goal. Making money.

Thanks again guys
Tramp
 
That might be a hard lesson to swallow. Nobody likes to find out that the other party was getting a better cut than you thought. Everyone on the forum is right here though. You really have to have a written contract, with all the details laid out in plain English, otherwise you will be on the short end of the stick.
 
Tramp1947 said:
Thanks to all.
There never has been a negotiated contract. For me it was just broker/ O/O working towards a common goal. Making money.

Thanks again guys
Tramp
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Tramp, if you feel you are being treated fairly by the carrier in all other areas I would say there is a pretty good chance they are also treating you fairly with the fuel surcharge. If you don't have a lot of other issues after 4.5 years I am guessing you have found a good fit your truck. Good luck and safe travels!
 
All the fine details aside, would it not make sense to come to an agreement that says driver get x% and company gets x% of TOTAL INVOICE? The percentages would change based on the nature of the employ, who pays for insurance, fuel, truck, maintenance, straps, vehicle replacement every x miles, etc..? In the end if the sales rep can negotiate an increase both the driver and the company win!

Comments coming from a guy who has never ran trucks, never intends to but can see where individuals (drivers) could feel they are not making their 'fair share' of the pot? Cudos to many members that clearly specify in other threads that they pay drivers for waiting time, drops, picks, premiums for hazmat certifications, etc...

Keep well,
Mike
 
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Tramp1947 said:
Sorry about the vagueness PackRat.

For the past 4 1/2 yrs I have been hauling for one carrier. Running under my own auth., Ins, plates and CVOR. I have been paying them a percentage for them to find the loads and they have been loading me as if I were a FULL company O/O.. There are a few of their clients that pay a FSC. and a few more who pay waiting time.
MY QUESTION WAS.. Does the company have the legal rite to that that percentage of the FSC and the waiting time??

Hopefully that clears it as clear as mud .
Thanks
Tramp
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That's a different story. If that's the case they should pay you either what they get paid as FSC or if you have a specific arrangement where they pay per mile plus an FSC per mile. Chances are even under that arrangement, they win some, lose some. But you should see a co-relation between your pay and fuel prices.
 
Thanks for all the great information on what I did wrong. My main problem is the trust I put in a long term relationship with a carrier. Pulling for one company and still maintaining ones independence is like walking a tightrope. You need to have faith in that co ability to keep you loaded and faith that you will get paid for the work you do. Now that I am no longer there I was just curious to see if I was entitled to it. Things have changed in this matter.
Now it is just a matter of trying to get the balance of my pay. It seems Schroeder Tpt from St Albert Ab. likes to play games with people. Oh well. Not my first rodeo. I guess Mr Schroeder needs the interest on my money for his church.
 
With so many transport entities failing these days, it is wise to have many clients. Some of the Schroeder carriers relied on them heavily. You can also perform pods seaechs to see what is owed to third parties. It is always wise to use caution when you see a secured creditor being an owner of the company you are dealing with.
 
htcollections said:
With so many transport entities failing these days, it is wise to have many clients. Some of the Schroeder carriers relied on them heavily. You can also perform pods seaechs to see what is owed to third parties. It is always wise to use caution when you see a secured creditor being an owner of the company you are dealing with.
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I think you are referring to Schroeder freight out of Winnipeg. Different carrier but you are correct that as a third carrier we have to be extremely careful
 
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