I am going to stir up a great load of crap around here ... Read all of this before you decide to opine.

[Michael Ludwig]

Just what exactly is wrong with making use of Drivers Inc. ???
To start off with I am well aware there are two distinct species of Drivers Inc. One is the law abiding professional driver that works for a law abiding carrier and they both conduct themselves professionally and legally. The other is the scumbag driver that works for a scumbag carrier and both of them are out there to cheat the tax man and subvert society. My question is directed at the former, and not the latter for my opinion is the latter should be deported if they fall under that category, and imprisoned if they do not.
So, back to our focus ... just what exactly is wrong with engaging in legal Drivers Inc.?
On the upside, from a back office perspective, it certainly lightens the administrative burden. It definitely eases your tax burden, even though you would pay that tax amount, or a good portion of it, to the Drivers Inc. participant. It negates any union issues, and most human resources issues.
On the downside, you would never really know how many drivers you actually have to work with, which makes recruitment, planning, and dispatching more challenging.
Thoughts, questions, opinions ???

Regulate by the hour, pay by the mile.
I read an article a while back about a U.S. carrier that had a novel solution to this problem. Pay drivers an hourly wage for each on duty and driving hour on their ELD, plus "X" number of cents per mile on the miles also reported by the ELD. For example $15.00 per hour, plus $0.25 per mile. Certainly solves a lot driver angst about not making money when their wheels aren't turning, and solves the carrier's angst about ensuring driver production.
Thoughts, questions, opinions ???

 

[tasuinam]

Question: would the truck have the Carrier's name on the side - and to be really legal would have to work for other companies as well - not exclusively yours - so would he then have everyone's name on the door?
How would that work?
Or would it be your equipment -and he just gives availbility

 

[Michael Ludwig]

Question: would the truck have the Carrier's name on the side - and to be really legal would have to work for other companies as well - not exclusively yours - so would he then have everyone's name on the door?
How would that work?
Or would it be your equipment -and he just gives availbility

Dude ... you're the first candidate for the remedial reading class ... LOL
Seriously though ... of course the carrier's name is on the side of the truck. The carrier owns it. We're discussing Drivers Inc., not owner-operators.

 

[tasuinam]

Dude ... you're the first candidate for the remedial reading class ... LOL
Seriously though ... of course the carrier's name is on the side of the truck. The carrier owns it. We're discussing Drivers Inc., not owner-operators.

thsi is what happens after a long day when your coffee machine is broken lol

 

[Igor Galanter]

Hey, Michael!
I had encounter with such mixed pay system about 8 or 9 years ago with a brief work for FORTIGO..
It was regional work, and honestly, very complicated that time..
Myself, I don't "stretch" my day by any means, so I didn't get FULL benefits from that system, if you know what I mean, lol...
But, some dudes, yes, were making as much hours as possible on top of driven mileage...
Honestly, I coudn't find a a fair explanation yet...

 

[MLCAR]

how would you handle WSIB? said Driver Inc would either have to provide their own or the company would have to provide (which I assume if agreed to can be deducted from the pay check). If the Driver Inc was to provide their own, it would mean making sure and tracking they are up to date on payments, and taking out clearance cert. for each one, every 3 months or so. Tangent here but technically wouldn't an "agency driver" from a "drivers for hire" technically be a "Driver Inc"? Agency drivers operate the companies equipment, but have nothing to do with the carrier itself. Carrier deals with the Agency/driver for hire service which pays the driver hourly/by the mile or driver inc etc. I know a few of the XL carriers that have this model and they are either doing something right or have the big boy lawyers that can handle any blowback.

 

[ONMARST]

@Melroy75 Sir there are some hidden factors involved in it1) if any small companies have one or more employees working per hour they supposed to pay WSIB premium quarterly
2) if any individual working independently and they require an exemption to get a clearance certificate WSIB doesn't allow them, if anyone doesn't have a clearance certificate from WSIB they will not get business at any cost. so basically u need to pay WSIB if it is a small amount quarterly.

 

[Michael Ludwig]

@Melroy75 ... to answer your WSIB question, WSIB would be Driver Inc's problem.
Keep in mind we are talking about legal Driver Inc. and your comparison with agency drivers is bang on. The only difference between the two is that Driver Inc is his/her own agency.

@Igor Galanter ... tell me more. I can see that 8 or 9 years ago what you describe might have been an issue. Today we have the ELD and I think that's the key to the whole thing. Frankly I'm following this very closely. It checks off a lot of boxes for me in both ease of use by my staff, and ease of explanation to my drivers.

 

[JayTee]

My accountant suggested this in 1989, we had four drivers at the time and they all wanted it. So we set up a numbered co., they all held preferred shares in the corp. which in turn remitted WSIB and paid out benefits as a bonus and they filed their taxes thru my accountant. Don't remember the exact #'s, but one of my guys grossed $64,000, as an employee he would net somewhere around $45,000 and see a refund of $2,500/$3,000, so an adjusted net of around $48,000. Under the Driver Inc. model, taking his legal COB out of the gross, his tax burden was less than $5000 +/- for a net of approx. $59,000. It worked well for all parties at the time. Where it gets sketchy is when the numbered co. disappears every year and the Driver Inc. dood doesn't comply with CRA/WSIB regs. In my view, of course.

 

[Igor Galanter]

I'm afraid, it won't be much help, Michael..
It was a few days of work as a power for them. The very main reason not to continue with them was their strong requirement to have all daily paperwork at their office in Etobicoke and just diving to and from was a killing , especially during rush hours ( parking base in Concord ).
Back to rates.. From what I remember, it was a certain amount of $$ per hour plus amount of cents for driving to and from destination. Also, a lesser amount of $$ for a wait time ( lesser then for driving).
So, the "stretchable" part was driving time $$ ( 3-3.5 hrs. for a regular 2 hrs. run) by using parking lots, or ramps on the way..
With ELD , it definitely going away, so to be efficient to both parties $$ for driving time have to be reasonable enough to keep wheels turning ....

 

[artmax]

Regulate by the hour, pay by the mile.
I read an article a while back about a U.S. carrier that had a novel solution to this problem. Pay drivers an hourly wage for each on duty and driving hour on their ELD, plus "X" number of cents per mile on the miles also reported by the ELD. For example $15.00 per hour, plus $0.25 per mile. Certainly solves a lot driver angst about not making money when their wheels aren't turning, and solves the carrier's angst about ensuring driver production.
Thoughts, questions, opinions ???

Good Idea about the combined pay. Never thought of this.

 

[RoadKing]

@Melroy75 ... to answer your WSIB question, WSIB would be Driver Inc's problem.
Keep in mind we are talking about legal Driver Inc. and your comparison with agency drivers is bang on. The only difference between the two is that Driver Inc is his/her own agency.

What is ”legal” Drivers inc if there is anything like that. From what I know the whole model is illegal!!

 

[loaders]

It is all about having a legal, level playing field. Whether the discussion is about Drivers Inc. or registering in provinces where you do not reside, or any of the other shady, dubious short cuts being taken by a few less than reputable operators, it really boils down to having the same set of rules for all the players in the game.

 

[Michael Ludwig]

What is ”legal” Drivers inc if there is anything like that. From what I know the whole model is illegal!!

No, the model, done properly, is completely legal.
The driver can be an independent contractor provided;
1) S/he is registered with CRA and has a business number.
2) S/he has a WSIB account in her/his own name.
3) There is a legal and binding contract between the carrier and the contractor specifically detailing the duties and obligations of both parties, and said definitions are well within the laws governing such actions.
4) A case could be made for the contractor to have their own CVOR.
There are advantages to such a system. Although it is unlikely to cost you less over all to put a driver in the seat, the company's tax obligations are greatly reduced, thus easing the company's cash flow, and back office [administration] expenses.
The downside is that you may, or may not, have enough drivers to fill your seats on a daily basis, as these drivers are truly independent operators. That alone is enough for some companies not to participate in the program.