Drayage is a central process in the long chain of logistics that is essentially a form of short-haul transport for transferring goods from ports to distribution centres. Given the high stakes of drayage operations, they are subject to strict regulations that directly impact costs and overall supply chain management.
The complexities of regulation can pose a challenge for both carriers and cargo owners as they seek to achieve both efficient and sustainable supply chains while staying compliant. In this blog, we discuss the latest regulatory change and its consequences for drayage trucking followed by the three key regulations that are pivotal for compliance for drayage carriers.
Understanding Recent Regulatory Changes and Their Importance for Drayage Trucking
46 U.S.C. § 41102(c) represents the latest guideline that sets out how diem and demurrage charges are to be determined so that both suppliers and customers can manage costs effectively. This can help them avoid misunderstandings and disputes later on which is good for controlling costs and preventing operational disruptions.
The ultimate purpose of these regulations is to make per diem charges and demurrage charges fairer and more transparent which will strengthen trust between different stakeholders like shippers, receivers, and transportation companies. This will in turn promote fair practices in transactions so that the interests of all parties are met while reducing container dwell time in warehouses.
Key Regulations for the Drayage Trucking Industry
1. Regulations for Ports
Since ports are the starting point for drayage transportation, it’s highly important for trucking companies to comply with the entry guidelines. To begin with, drivers need to provide a valid Transportation Worker Identification Credential (TWIC) card to authenticate their identity and gain access to restricted port areas.
They also need to book their schedules in advance for both picking up a drayage container and dropping it off as this helps reduce backlog and minimize unnecessary delays. These measures are aimed at making port operations more secure and efficient so that the safety of both cargo and drivers can be ensured.
2. Regulations for Trucking Chassis
A crucial component of drayage trucking services is chassis which refers to a fleet of trailers and containers that are used for moving freight. These equipment are required to adhere to specific safety and maintenance standards so that the drayage freight suffers no damage or loss along the way.
The chassis has to go through regular inspections to determine whether it is rigorous enough to sustain on roads.There are also weight limits that specify the maximum load for container drayage as over loaded containers are not only prone to accidents but also liable for hefty fines.
3. Hours of Service (HOS)
It’s common for drivers to experience fatigue as they handle multiple round trips carrying containers to and from ports. The purpose of HOS regulations is to help drivers differentiate between off-duty and on-duty hours so that they can actively perform their work without compromising their safety and that of others.
As per the Federal Motor Carrier Safety Administration (FMCSA) rules, manual logbooks are to be replaced with ELDs for keeping track of the number of working hours and rest periods of drayage truck drivers. This can yield an accurate account to verify whether they are complying with HOS guidelines.
- Drivers can drive for 11 hours after they have taken 10 consecutive hours off duty.
- Following 8 hours of consecutive driving, drivers are required to take a 30-minute break which may be off or on duty.
- Drivers have to comply with a weekly limit of a maximum of 60 hours for 7 days of consecutive driving. This may be extended to 70 hours when another working day is added to the schedule.
4. Employee vs. Independent Contractor: Labor Laws
The labor laws seek to classify drivers based on whether they are to be regarded as independent contractors or regular employees. This has proven to be a contentious issue mainly because of the financial and legal implications it carries.
The laws have clearly defined the minimum wage and benefits that employees are entitled as well as leverage for overtime if the drivers are classified as employees.
There has been a trend for union bodies in the drayage sector that can impact how employment policies are implemented and hiring costs.
Compliance Measures and their long-term benefits
Compliance can be a costly affair but a cost-benefit analysis makes it clear that it is a worthy investment in the long term considering that non-compliance can result in fines and penalties not to speak of the reputational damage. Implementing the following compliance measures can remove inefficiencies from drayage trucking operations and make them more resilient to external setbacks.
- Replace your standard vehicles with a modern, tech-driven drayage trucking fleet. These vehicles are fuel-efficient which not only controls drayage cost but can prevent fines due to excess emissions.
- Provide training to your staff so that they are aware of any regulatory changes can ensure that their practices are consistent with compliance requirements.
- The use of compliance management software provides a convenient way to keep a record of necessary details related to operations and is further helpful for audits.
FAQs
1. How can drayage companies reduce compliance costs?
Compliance costs can be reduced by investing in fuel-efficient trucks that use less fuel per 100 km of travel and using telematics to leverage GPS and vehicle data to track HOS. They can also benefit from tax credits and loans by signing up for Government incentives for green fleets and adopting automation tools for real-time monitoring to minimize expenses.
2. What happens if a drayage trucking company fails to comply with regulations?
Non-compliance can subject a drayage trucking company to fines and penalties and for serious charges, their operating licences can be revoked too. In extreme cases, companies may face legal action and eventually lose the privilege to access port facilities.
3. What are the biggest regulatory challenges facing drayage trucking companies?
Drayage trucking companies are subject to stringent regulations that cover various areas such as environmental standards to reduce emissions, hours-of-service limitations, safety standards for drivers and cargo as well as requirements for customs procedures.
4. How can technology help with regulatory compliance in drayage trucking?
Technology can enhance compliance by allowing drayage companies to keep track of emissions in real-time as well as monitor driver hours and chassis conditions. Digitizing documentation tools can simplify the audit process while optimizing routes through AI can facilitate adherence to regulatory requirements.
Conclusion
Drayage trucking regulations are constantly evolving, making compliance non-negotiable for companies that seek to offer top-notch services while steering clear of legal issues. Staying informed about regulatory changes is a pre-requisite to compliance and a compliant business can position you for success in the dynamic transportation industry. This is crucial in a competitive freight industry driven by a rapidly growing e-commerce sector and technological advancements to optimize costs and win the trust of clients.
Navigating the complex landscape of regulatory challenges can be challenging but the guidance and expertise of the right logistics partner can make all the difference in your logistics operations. Get in touch with us today to learn how our drayage trucking services can fulfil your logistics needs while helping you balance compliance with more efficient and sustainable operations to fuel growth.