Making Up for Lost Time: Detention Pay

The detention time is the time a driver spends waiting for the shipper to load and unload cargo. The detention pay for truck drivers is supposed to compensate for the financial loss and opportunity cost imposed on the driver due to waiting for more than two hours. The damages done to the drivers and the expensive consequences of delayed shipment makes detention time and pay a major source of controversy in the logistics industry. To capture what this means for truckers, I will discuss what detainment is, how to get paid, and what the immediate and overarching consequences are from the driver’s perspective.

What does it mean for a driver to be detained?

Carriers are considered detained when the shipper is not ready to load or unload upon their arrival and they must wait until the shipper is ready. The standard time for the loading process is two hours, therefore the detention time begins after the two-hour mark and the fee is charged for every additional hour the driver is forced to wait. For example, if the first two hours are free, a five-hour delay would result in three hours of paid detention time. The compensatory detention pay averages $25-$100 per hour, but this will hardly account for the wasted diesel, not to mention the opportunity costs for the driver.

How do drivers get detention pay?

If it takes longer than two hours to load or unload the truck, the driver can request detention pay based on their broker-carrier agreement. This agreement should clearly outline the rate of compensation and when the driver is entitled to it. Based on the terms of their agreement, the driver can notify the dispatcher or broker when they need to be compensated for detention time. However, the terms of broker-carrier agreements can vary, and in some cases, detention pay is only available in waits longer than three hours or may not be available at all. Below is an overview of the steps necessary for a trucker to receive their detention:

1. Establish the broker-carrier agreement that sets the rate of pay for time under detention and terms for qualification.
2. Notify the dispatcher or broker when one is entitled to detention pay.
3. Receive a new rate confirmation with the detention pay added.

Remember that sometimes brokers resist adding detention to the rate and may intentionally delay payment on the chance that the driver will just move forward with the original rate confirmation.

The Immediate Consequences

When a shipper is behind schedule it has the potential to completely derail a trucker’s day. First, drivers face the risk of being forced to cancel a previously booked load. Additional to the financial loss, the subsequent loads in the following days may also be derailed. A failure on the shipper’s part has made the driver’s previous efforts in planning their loads go to waste, not to mention the time and money spent in making their pickup possible in the first place. Secondly, truckers are bound by the ELD mandate to limit their Hours of Service per day to fourteen hours – the clock doesn’t stop for them even when detained. Carriers lose a sizable chunk of their available driving time due to the shipper’s lack of preparation, and it therefore diminishes their ability to make money. This considerably increases the driver’s willingness to skip breaks and drive unsafely to make up for the lost time.

Carriers pay a hefty price for the failure of the shipper to be on time, yet the compensation for their loss is inadequate and unreliable. Drivers are not always paid and often have to be very persistent to get their compensation. This is more than a simple inconvenience to the driver and it is arguably not fixable by detention charges that do not cover the cost inflicted upon the driver.

The Overarching Consequences

Everyone loses money when a truck driver is detained. Inflated rates, extra fees, and a subsequent shortage of drivers willing to carry for shippers and receivers with high detention times are only some of the risks that the industry faces. The Office of the Inspector General (federal government oversight) completed a report in 2018 that estimated, “…that driver detention can cut earnings for truckload drivers by $1.1 billion to $1.3 billion, with annual net income for carriers reduced by $250.6 million to $302.9 million.” Beyond the individual driver, this inefficiency costs the industry as a whole. As the FMCSA, OIG, and DOT have discovered, measuring the true extent of these losses is unfeasible because of the many downstream and widespread effects; this suggests that the economic damages done by high detention times are likely to exceed existing predictions. Supply chain management and logistics is often regarded as the backbone of the U.S. economy, and by this logic, the entire nation has a vested interest in correcting inefficiency at this scale.

So, what is detention pay for truckers?

Detention pay for truckers is currently an inadequate attempt to compensate drivers for time lost in delays during loading and unloading a shipment that exceeds two hours. The detention charge does not make up for all of the downstream effects of a driver’s detention and the current fee rate is not enough to deter the shippers and receivers from preventing detention time for truckers.