Denis Gray Trucking Inc., in Sumner, WA, caught my attention on our Facebook wall a few weeks ago.
There was discussion regarding trucker pay and the shortage of good drivers. One of the posts that stood out, was written by a trucking company owner who reported that his company had switched from paying their drivers by the widely practiced mileage rate, to a flat rate salary. Of course, this was of great interest to me.
Mike Gray of D.G. Trucking, had agreed to an interview about his company and their new salaried driver program.
Here’s the interview.
Give us the scoop and the basics on Denis Gray Trucking
We are a flatbed trucking company and also specialized: steps, RGN, oversize, and stretch trailers, located in Tacoma, Washington.
We run mostly the Western States of Washington, Oregon, Idaho, Montana, California and Utah, Western Canada, B.C. and Alberta.
We are a small trucking company: 21 trucks and about 50 trailers and employ 21 truck-drivers. We are a second generation family owned company, and have been in business for 38 years.
I understand you’ve recently changed your hiring process.
We were having trouble finding qualified truck-drivers and had to start hiring recent grads which is something we’ve never had to do.
We identified the ideal driver for our company: truckers with a minimum of 2 years flatbed work within the last 6 years, could cross the border into Canada, had no more then 7 jobs in the last 10 years (not a job hopper) and had a clean CSA.
What makes good truck-driver, suitable for hire at Denis Gray Trucking?
Along with the above qualifications, we narrow the field by an in-depth interview process with the potential employee.
We have a list of questions which help us identify the key qualities we are looking for: an ability to problem solve independently, honesty, excellent communication skills, load securement knowledge and experience in driving in extreme weather.
When deciding to hire a driver, we ask ourselves: are they as good as or better than the top 50% of our present staff of truck-drivers? If yes, then he’s a good choice for hire as we’ll make our company better. If the potential employee is not of the same or better caliber than our top 50%, than he won’t be hired.
What pay packages does Denis Gray Trucking offer?
We have 2 pay packages.
Package 1: For Lowboys: $1050 base pay per week. If they work more than 60 hours/week, they are paid $21.50/hour for every hours after 60.
Package 2: For an international oversize flatbed driver, $980 base pay per week. If they work more than 60 hours per week, they are paid $19.50/hour for every hour they work past 60 hours.
These packages are designed to make sure our people have a stable income, no matter what happens in the truck. As long as they are on time and do their part, the rest is up to Denis Gray Trucking management to keep that truck rolling and make sure it gets the needed revenue.
We also have a bonus/profit sharing program. The company keeps the first 10% of net profit and any money received after this, is contributed to a pool. We call this the bonus pool of funds.
Drivers can earn points based on how much gross revenue their truck earns, how long they have been with the company and clean Level 1 inspections. They will automatically be disqualified if they have an incident that costs the company $500 or more.
At the end of each quarter, the pool of bonus funds is divided among all drivers, based on how many points they have earned for that particular quarter.
Why the change from paying your employees/drivers by the mile to a salary?
I tried to figure out where ‘the pain’ is for experienced truck-drivers. I found that many are discouraged by the inconsistency of pay and the number of pay schemes in the industry.
I believe this is a industry wide problem and it really doesn’t matter if you make .30/mile or .50/mile. The pay of a trucker pretty much depends on the dispatcher.
At the same time, the trucker’s bills at home are the same, while his pay fluctuates. If dispatch is giving that driver crappy runs, no matter what the pay scale, they are getting punished.
Most drivers just want to work hard and make an honest living. You can add on MPG bonus, high mileage bonus etc….but these things don’t really seem to mean much to most guys, because usually none of these factors are directly under a driver’s control.
I often think when I see trucking companies offering big sign on bonuses, of how desperate that company is. Truckers are smart and they are figuring out these bonuses are a scam. If a guy is going to hop jobs for $1,500, that is not really the kind of driver we want.
So we looked at the bigger picture and asked ourselves, “what do drivers really want?” We feel they want to be treated well, to be paid fairly and honestly and have a steady income to take home.
This change has also affected the way we look at our business as a whole. We can look at our gross revenue per truck and if that truck is not earning enough money, it is a management problem, not necessarily the driver’s problem. It’s our problem to fix.
This methodology also allows us to look at our drivers as a fixed cost, just like a truck payment or insurance. We need them to keep the wheels turning.
What changes, if any, have you noticed with the drivers, since the change from paying your drivers by the mile, to paying them a salary? If it hasn’t been long enough to notice any changes, what are you hoping to accomplish by making this change at Denis Gray Trucking?
We stress to our new employees that we want to be sure they are satisfied with the weekly pay. We find the bonus program really gets the drivers involved in and interested in the companies bottom line. I think they drivers really know we care and we want them to succeed.
Our goal for driver retention after the first quarter of 2014, is to have a driver turn over rate of less then 20% (YTD 10%) and by the end of 2014, have a waiting list of 5 or more qualified drivers on a waiting list.
I think carriers need to ask themselves same the same questions we did.
i) What would it be worth to have a fleet of truck drivers that actually care about your bottom line?
ii) What would a turn over rate of less then 20% be worth to you?
iii) How much more money can you make with a seasoned driver in the truck versus a rookie?
iv) How much money and time do you spend finding, qualifying and training drivers? What else could you be doing with that time?
v)What is the real cost of a truck sitting without a driver?
As a carrier, what’s your greatest challenge in trucking?
Our biggest challenge by far, was finding and keeping the good drivers. Now wefell we have one of our biggest obstacles mostly taken care of, so we can concentrate on improving our business.
Our big goal is to provide a place where good drivers retire and also to have a waiting list of qualified ones. I really believe that any trucking company is only as good as the sum of it’s drivers.
What do you anticipate is in store for the trucking industry in the future?
My philosophy is ‘he who has the drivers, wins”. Good customers and good paying freight come naturally to a company that can provide a great service. Everyone knows about the driver shortage and it’s not going to get any better unless we fundamentally change the status quo in this industry.
Drivers are too often treated like crap. I hear people complain frequently about their drivers. However, I’m not one of them. Companies that treat their people like crap whether it’s to their face or behind their back, deserve what they get….bottom of the barrel employees.
I believe most truck-drivers are basically good people that just want a honest day’s pay for an honest day’s work. The good ones will bust their butt for you if you believe in them and let them know it.
My comments: It sounds like the folks at Denis Gray Trucking are really trying to do ‘right’ by their drivers. Micheal Gray did not report to me, that the owners fund a charity children’s program in a third world country….. an admirable community-minded thing to do.
Best of luck to all at Denis Gray Trucking. Keep us posted on any updates.