8 Types of Truck Driver Pay Jul01


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8 Types of Truck Driver Pay

Money is what makes truck driving jobs a profession, and what a professional truck driver gets paid is determined by the company they work for and the work they have been hired to do. But understanding the many types of truck driver pay can be a challenge.

It is important to understand the terminology used in describing compensation, especially when looking for a company to call home. Even though pay is sometimes complex, understanding the nuances of pay is as simple as understanding some of the trucking industry’s standard terminology.

Here are some of the most common types of truck driver pay:

Hourly Pay

Pay per hour is the familiar fare of men and women who work by the hour for a certain number of hours each week. Typically broken down into dollars-per-hour, this pay is common among intrastate delivery companies driving their goods from location to location in areas less than 150 miles from their base of operations. Warehousing businesses like UPS, FEDEX, or familiar retail and grocery chains pay drivers by the hour. Hourly work is often busy work. Drivers sometimes participate in loading and unloading of freight, may have multiple stops on their route and may not always start out with a full truck. Common industry terms for jobs like this include Less Than Truckload (LTL), or route driving; Linehaul from terminal to terminal; and P&D, or pick up and delivery, usually within a city and its suburbs.

Hourly pay varies from entry-level to higher and more desirable rates, and is typically associated with strict schedules, heavy lifting, and direct daily interaction with customers.

Per Mile Pay

Pay by the mile is the most common type of base pay in the trucking industry, but how companies pay for those miles may vary. The three most common per mile pay rates are:

  • Practical Mileage: This is calculated using the most efficient distance between the origin and the destination. The distance is calculated by satellite along a known route, and is typically reflected in a truck’s onboard electronic logging device (ELD). This mileage is similar to the mileage estimate given for the same trip planned using Google Maps.
  • Household Goods (HHG) Mileage: HHG miles are also known as zip code or short miles. They are calculated using the shortest distance between two zip codes, specifically the distance between the addresses of the main post offices in each area.
  • Hub Mileage: This is the ACTUAL mileage the truck is driven, based on the vehicle’s odometer reading. This includes all hours of service (HOS) miles accrued including stops or reroutes.

Keep in mind that per mile pay may appear to vary wildly, especially when a position calls for team driving. The apparently higher per-mile rates for a solo driver do not reflect the increase in miles a team will be able to drive while one driver observes mandated breaks and rests while the other driver continues to rack up road miles.

Per Diem Pay

Pay per day, or per diem, is a non-taxable daily allowance to cover meals and expenses while on the road. If a company offers per diem pay it will appear on each paycheck but the IRS will not assess it for taxes. And even if a company does not offer it, drivers may still take the standard IRS per diem deduction of $59 per workday when filing taxes.

Percentage of the Load

Most owner-operator truck drivers negotiate a percentage of the load pay, where a negotiated sharing of a portion of either the gross or the net revenue of loads delivered for the company is agreed upon. Especially attractive if hauling valuable freight or driving short to medium length hauls, this model is among the highest truck driver pay in the industry.

Stop Pay

If a load requires multiple stops between loading and the final destination, a driver could be paid for those in between stops along the way. This doesn’t include the pickup location or the final destination, and is intended to compensate the truck driver for their additional time to execute these stops.

Detention Pay

In order to get the best out of any haul, drivers need to stay within hours of service requirements as well as on-schedule. When a shipper causes unnecessary delays it can create challenges later in the route, and some companies will offer compensation for that lost time. Scheduled drop-off and pick-up times often include a buffer of two hours, so if a load is held up any longer than that drivers may be paid an hourly or fixed rate dictated by company policy.

Accessorial Pay

This broad category of pay may be used by companies to compensate drivers for services performed beyond hauling and maintaining a load, and may include:

  • Loading and unloading trailers
  • Shrink wrapping pallets
  • Tarping flatbed loads
  • Operating a forklift or pallet jack
  • Paying for tolls or border crossings
  • After hours deliveries
  • Non-dock deliveries
  • And many more

If a company offers accessorial pay, any billable services are generally invoiced to the customer and passed on to the driver.

Fuel and Safety Bonuses

Fuel costs are an important consideration for any trucking company, so offering drivers incentive to improve their MPG makes good sense. When a driver helps their company reduce fuel costs by making even small improvements to their average MPG, the company may share the savings via a quarterly or annual bonus.

The safe handling and hauling of loads prevents the loss of time and profit, and companies appreciate the attention to detail and professionalism required to accomplish this. So it is not uncommon for a company to offer safe performance bonuses, bonuses based on accruing safe miles, and recognition bonuses for years of safe driving.

The trucking industry is as diverse in the types of truck driver pay as the services it performs. Knowing some of the industry terminology and how company pay structures work will go a long way to helping drivers maximize their earnings and negotiate rates of pay. Working as a professional driver, whether locally or over the road can be rewarding. And understanding the many types of pay will help drivers guarantee their earnings keep up with their love of the job. Apply Now to drive for System Transport and discover for yourself why we were a finalist for the Truckload Carriers Association’s 2019 “Best Fleets to Drive For”.

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