Roehl Transport reinvents driver pay to compensate for time-consuming work

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Time is money, but miles have long been the preferred unit of measurement when it comes to charging shippers and paying drivers. That can be problematic for shrinking lengths of haul and an industry that's fraught with delays like traffic snarls and shipper/receiver detention – losses in productivity that don't provide fleets with a lot of incentive to convert to an hourly pay structure. 

Roehl Transport (CCJ Top 250, No. 59) this year blended the best of both worlds, offering its national, regional and home daily fleet drivers a mileage band pay plan featuring rates per mile based on the length of haul with added activity pay. Mileage bands start at zero to 50 miles and increase in 25-mile increments to 150 miles, where they jump in 50-mile increments up to 500 miles. According to Tim Norlin, Roehl’s vice president of driver employment, the switch has equated to a 12% to 14% pay raise – the third driver pay bump in two years. 

Roehl – a Marshfield, Wisconsin-based provider of dry van, refrigerated, flatbed and dedicated services – modeled its address-to-address pay structure off an hourly rate to come up with its mileage bands and mileage rates, which fluctuate by trailer type. For example, a driver running in the flatbed group will earn more per mile than a driver hauling a dry van, with reefer falling somewhere in the middle. There's also consideration for the region in which the driver operations. 

“These enhanced pay plans, when combined with our address-to-address mileage calculations, 3-cent accident-free pay and performance bonuses, ensure that Roehl drivers receive some of the highest compensation in the industry. In fact, some drivers will earn $1.64 per mile," Norlin said. "It encourages the driver to be productive, but it also takes into consideration the driver's time. We're trying to hit that $27-$28 an hour sweet spot for a driver with this new compensation plan."

Even though the company has a per-hour rate benchmark that it's seeking to provide the driver, Norlin said not going to a full per-hour pay model leaves productivity incentives in-play. 

Roehl Transport's mileage band pay plans feature rates per mile based on the length of haul with activity pay added in."When we have that productivity incentive in there, we think that helps the drivers and encourages the drivers to stay productive," he said. "To sweeten that, we also have a quarterly bonus that drivers can earn based on their productivity and miles – anywhere from a penny a mile all the way up to 5 cents per mile, depending on the miles. It's a point-based system, so it's miles, it's loads, it's on-time performance, and obviously, accident-free is in there as well."