U.S. ports that want regulatory authority over trucking so they can reshape the harbor drayage industry can look to Port Metro Vancouver to learn how such a regime would work.
The Canadian port in 2005 initiated a truck licensing system following a crippling six-week strike by more than 1,000 owner-operators. In order to call at marine terminals in Vancouver, motor carriers now must sign a licensing agreement that sets minimum rates of pay and establishes basic working conditions for drivers. Former owner-operators were grandfathered into the agreement, but any new hires must work for a motor carrier and drive company-owned equipment.
|Five years later, the system is working fairly well, although trucking executives want to change certain features that affect productivity and competition in the industry, said R. Gordon Payne, chairman of the Metro Vancouver Container Drayage Association.
The primary purpose of the licensing plan is to prevent a proliferation of poorly funded drayage companies that will inevitably result in ruinous rate competition. In that respect, the program is fairly successful. “The port wanted more control, more stability. The licensing system brought stability,” Payne said in an interview in Vancouver.
The Port of Los Angeles concession requirements now under legal challenge mimic in some ways the Vancouver licensing system. Los Angeles and neighboring Long Beach sent a delegation to Vancouver in 2007 to study the Canadian plan. The ports included in their clean-trucks plans Vancouver features such as limiting port access to licensed motor carriers with employee drivers and strict vehicle maintenance requirements.
Los Angeles, with its labor-friendly mayor, was also motivated by a desire to establish a system that would lead to the unionization of the drivers. Under U.S. antitrust law, independent contractors can’t be unionized, but employee drivers can be. The ports of New York and New Jersey, Oakland and Seattle have since announced clean-trucks plans based on the Los Angeles model.
The American Trucking Associations sued the ports of Los Angeles and Long Beach, charging the employee-driver mandate and other concession requirements violate federal pre-emption law. Long Beach has since reached agreement with the ATA and is no longer a party to the lawsuit, now before the U.S. Court of Appeals for the 9th Circuit.
In Canada, it’s permissible to organize owner-operator drivers, and, in fact, the Canadian Auto Workers, the Teamsters and two smaller unions have organized hundreds of drivers. According to the port, collective bargaining agreements cover 83 percent of the wages in the container sector.
Independent contractor status and unionization are not issues under the Canadian plan. Some companies hire employee drivers, while others build their business model on owner-operators, Payne said.
The licensing system protects nonunion drivers because their companies must follow wage scales negotiated by the unions. Those rates, which range from slightly below to slightly above $100 per haul based on the trip length, are published on the port’s Web site.
The Vancouver program hasn’t been trouble-free, however. Drivers have taken job actions or threatened to do so several times since 2005. Alleged abuses of the system continue.
Unions charge some trucking companies, with the consent of their drivers, are paying lower wages and undercutting the market to attract business. Port and provincial regulators say there are no such abuses. Motor carriers simply want a level playing field. “Bring on the competition, but it must be guys we can compete with,” Payne said.
Motor carriers also are attempting to head off a $300-per-truck fee scheduled to take effect on April 1. The proceeds will help the port authority pay the cost of administering the licensing system. Truckers prefer that any fee be imposed on the cargo, not the truck, and charged directly to shippers. Motor carriers lack the leverage needed to pass on a truck fee and the resources needed to administer it, Payne said.
Motor carriers also want to redesign the mandatory appointment system at marine terminals, which Payne said works against arranging two-way hauls. “We’re doing a lot of deadhead runs,” he said.
And trucking executives say it’s time for the port authority and terminal operators to meet with them and begin planning for the inevitable time when cargo growth dictates the need for extended terminal gate hours.
Despite such issues, Payne said, the truck licensing system is fundamentally sound and should be improved rather than scrapped.
Contact Bill Mongelluzzo at email@example.com.