“... do your research now , make a plan , and execute it . No one is going to switch until everybody has to .
You want to be the one that does it best .”
A ndrew Brady says he sleeps better since he made the switch from IC to employee drivers . “ Going back to employee drivers was the best thing I ’ ve done ,” he says . “ My life is easier . There ’ s no haggling over payouts , no arrogant drivers abandoning jobs in the middle of the day . Our service levels are higher , our on-time percentage is better , and my dispatchers are WAY happier , and I sleep better at night !”
Brady is the Chief Operating Officer (“ I make sure everything gets there on time ”) of King Courier in San Francisco . The company provides delivery and logistics services , and transporting packages , documents , and other goods for businesses and individuals in the Greater San Francisco Bay Area using 20 employee drivers . That ’ s actually fewer drivers than they needed when they used ICs .
The company actually started out with employee-drivers in 1992 but switched to an IC model in 1999 , spurred on by drastic rate hikes in workers comp rates . “ From 1999 to 2004 , we used the traditional TPA style IC model ,” he says .
“ From 2004 to 2007 , we utilized a novel brokerage model , and in 2007 , we reverted to employees ,” he says .
He acknowledges that many carriers resist making the switch , fearing it will be a lot more expensive . “ Yes , it is more expensive . About 20 % more ,” he acknowledges , “ But it ’ s not the 35 % hike everyone always claims . The biggest thing you must do is keep an eye on overtime . Managing overtime is hard . Operating 24 hours a day with employees is definitely more challenging , but it can be done . Eventually , things come around , but rolling it out was a real pain . I won ’ t sugarcoat it . But honestly , the biggest change I noticed was that my life got easier .”
And he predicts the current environment will force others to make the change . “ I realize that no one ’ s going to switch until everyone switches . It won ’ t happen voluntarily until the Department of Labor on the federal level says , ‘ No one can be an independent contractor .’ Once that happens , we ’ ll have a level playing field since no one will be able to use ICs and therefore undercut each others ’ pricing ,” says Brady .
“... do your research now , make a plan , and execute it . No one is going to switch until everybody has to .
You want to be the one that does it best .”
fall 2023 I customized logistics & delivery Magazine 41