Two groups representing small-business truckers should know by early next year whether federal regulators will grant their requests for more transparency in freight transactions involving brokers.
Petitions by the Owner Operator Independent Drivers Association and the Small Business in Trucking Coalition (SBTC) seeking more oversight of broker transaction records were published in August 2020 by the Federal Motor Carrier Safety Administration, seeking comment on the two requests.
OOIDA sent a letter to FMCSA in September pointing out that it has been over two years since the group submitted its original petition. “We believe an update is warranted on where the agency stands on our outstanding petition and related comments from motor carriers,” stated OOIDA President and CEO Todd Spencer.
FMCSA “has been considering the issues raised by OOIDA’s petition for rulemaking and based on that work is targeting early 2023 to issue a decision,” the agency stated when asked to comment on the groups’ rulemaking request.
“When assessing possible broker transparency rulemaking, FMCSA’s role is to remain within the bounds of our statutory authorities and also takes into account whether and how additional rulemaking will effectively and efficiently resolve the issues identified,” FMCSA added.
Specifically, OOIDA requested that regulations on broker records (49 CFR 371.3) be amended to require brokers to provide an electronic copy of each transaction record automatically within 48 hours after the contractual service has been completed. It also requested that FMCSA prohibit brokers from including contract provisions requiring carriers to waive their rights to access their transaction records.
“OOIDA’s recommendations to enhance compliance … are not attempts to control rates or impose burdensome requirements, but would simply ensure that motor carriers have access to documents they have the right to view,” Spencer stated.
Such documents are supposed to include the amount the broker received for its service and the name of the payer, as well as the amount of any freight charge collected by the broker and the date it was paid to the carrier.
SBTC’s petition similarly asks that FMCSA prohibit brokers “from coercing or otherwise requiring parties to brokers’ transactions to waive their right to review the record of the transaction as a condition for doing business,” FMCSA stated in the petition notice.
Months after FMCSA’s comment request on OOIDA and SBTC’s petitions, the agency issued a notice and comment period for an opposing petition by the Transportation Intermediaries Association (TIA) — which represents truck brokers — asking that FMCSA repeal the current provision in the regulations that gives carriers the right to review the broker transaction record.
“TIA believes that 49 CFR 371.3(2) should be eliminated because it hinders supply chain functionality as well as a free, open, and competitive marketplace,” a TIA spokesperson told FreightWaves. “The regulation is outdated, unnecessary and will continue to be used as a tool to try to re-regulate the industry, which runs contrary to the intent of the Interstate Commerce Commission’s rules back when they were enacted in 1980.”
FMCSA confirmed it is still considering the issues raised in TIA’s petition, with a target date of early 2023 for a decision on whether to publish a rulemaking on their request as well.
OOIDA and SBTC filed their petitions at the beginning of the COVID-19 pandemic amid accusations that brokers were colluding on prices. The allegations were repeated by then-President Donald Trump but were rejected by Robert Voltmann, TIA’s president at the time, who stated that there was simply not enough freight to support the amount of truck capacity in the market.
Accusations of wrongdoing receded as freight rates and demand for capacity surged over the past two years, but that could change as capacity loosens and spot rates continue to trend down.
“As conditions in the trucking industry change, and more carriers face challenges, we can assure you that FMCSA and others in the federal government will continue to hear about the lack of broker transparency from small-business truckers,” Spencer stated in his letter to FMCSA.
Kevin Spencer
Brokers know how much the carriers making knumbnutts should work both ways it’s called transparency. Did they teach that in your 48 hour broker class?You have yet to see why, I’ll tell you why you sit in your recliner just back from Starbucks, after you put up a vehicle needs shipping, on a free load board, the budget someone gave you( nothing that you’ve actually done yet) is let’s say $1000.00 you list the vehicle for ( in todays market you’ll offer the carrier $200-$250) for a 120 mile run,let’s say. To this point you’ve done no work except answered 1 phone call.ok, the carriers excepts the call because he’s scrambling man insurance is due in a week or so $1400 every30 days and $6.50 at the gas pump where he takes that $250 puts it in his tank and gets 3/4 of a tank of fuel, shows up to the car where he finds the steering wheel locked emergency brakes electric with no battery, and as you try and figure out wtf happen where this wasn’t notated anywhere because the broker knows if he puts that in service notes not 1 carrier will touch that shxx for 3/4 of a tank of gas man. Not all but a lot of brokers from around the world look down and treat carriers like exposible waste. All the while I’m talking to the client face to face and there looking at me and I’m looking at them they say “ I told the broker about the no keys etc…” I’m thinking about you at this point for kicking back pocketing $700 that you truly did nothing to earn you ripped it off and hide behind some broker BS rule cuz honestly if I would have originally talked to the client I would have charged $500 so your not just ripping off carriers boys and girls your ripping off the client and making this industry SUB-PAR. WALLOW IN THAT ( oh and I’m not crying this is a carriers reality) where we ask everyday what the hell do we even need brokers for? Cut out the Rip-off man I mean middle man! TRANSPERENCY AT THE LEAST
Bob weir
This would seem no different than smaller non union trade companies demanding all the large companies make their contracts available for scrutiny.
Bob
You don’t want the load don’t take it. Shut the heck up and quit winning. Crybaby truck drivers. The government got rid of all the professionals.
A
Jeff ayres
“It should be included in the load tender as too how much the broker is getting and how much the carrier is getting before the load is getting pick up. That way if the broker is taking too much of the load pay the carrier can decline the load. This is a fair way of doing business.”
Such flawed logic, you are fine with taking a load if the broker is making X amount of dollars but not Z? Just don’t take the load at all if you are not fine with the amount you are being paid.
A
Ovidio crespo
“If the president, salary can be publish,why not the broker…”
Because the President is a public position funded by tax payers, unlike a broker.
A
I have yet to see a good reason WHY a carrier should see what a broker makes.
Truth
the market is cyclical – over the past few years, carriers had all the leverage compared to the shipper and we didn’t hear carriers complaining then when many brokers/shippers were getting worked. It only seems fair for a broker to have access to the margin the carrier is making off a single load as well. Business is not always fair for both a carrier and broker and you have to be able to adjust accordingly based off market conditions and have long term plans in place.
LeRoy Rokusek
Brokers dont want truckers know what they are getting when they broker their loads to the o/o and that way they can get more for themselves which is scalping in my view. Brokers need to be accountable for what they get of each load.