What Freight Brokers Need to Know About the New National Carrier Hiring Standard

Share on facebook
Share on twitter
Share on linkedin
Share on pinterest
Share on reddit
Share on email
Share on print

Freight professionals can expect a new national carrier hiring standard in the coming months.

In April 2018, a relevant amendment to the Federal Aviation Administration (FAA) Reauthorization Act successfully passed through the House of Representatives. It creates a statewide standard for hiring truckers that should help shippers and brokers in their work. The development seems like a positive step for the industry, introducing clear criteria for carrier selection and potentially limiting shippers’ and brokers’ liability in certain cases.

It’s expected that the Senate will propose its own version of FAA reform legislation in the coming weeks. This means that it’s likely the changes would be debated in the Senate this summer, with possible new rules coming into force after fall 2018.

The House proposal on carrier selection criteria

Within the new FAA legislation, the House of Representatives proposed the introduction of soft criteria for shippers and brokers that they can employ when selecting carriers to work with.

According to the House’s amendment to the FAA rules, a motor carrier can be considered safe if it has obtained the federally required insurance and licensing. It also has to have a positive rating from the Federal Motor Carrier Safety Administration (FMCSA).

Besides the selection guidelines, a provision in the bill also suggests a limitation on the liability of shippers and brokers regarding the choice of a carrier. This may lead to fewer problematic situations for intermediaries, including fewer occasions that can lead to claims on freight brokers’ surety bonds.

How To Determine Freight Class: Density Calculator & Printable Resource

DOWNLOAD THE FREE RESOURCE HERE

Previously, brokers have been sued in state courts for their choice of carriers that have caused accidents. The accusations have revolved around negligence in checking carriers’ safety records. Trial lawyers also used arguments such as the carrier or trucker being employed by the shipper or intermediary during the accident. For freight brokers, it would be certainly beneficial to have a nationally applicable way to handle issues such as liability after accidents.

According to proponents of the amendment, its purpose is to bring a nationwide standard in the process of hiring a motor carrier in order to raise the level of such services in the U.S.

The legislative process onwards

Even though the House of Representatives has already passed the bill, the national carrier hiring standard remains to be finalized and enacted as law.

The first step, as mentioned, is for the Senate to start discussions on the FAA bill. Lawmakers are expected to launch this soon, with a final deadline at the end of September. By then, the Senate should have passed the FAA Reauthorization Act.

Experts expect the Senate to present a different take on the bill. This would result in a conference committee consisting of the two chambers. They would have to work on a unified bill. Afterward, the trucking industry would have to be consulted. After the legislation gets approval from both chambers, President Trump will need to sign in into law.

The Transportation Intermediaries Association (TIA), which is an avid proponent of having clear national carrier hiring standards, will campaign for the inclusion of the rule in the main text of the Senate bill, and not in an amendment. In this way, it would be less likely that the proposed standard would be skipped if the two chambers have to reach a unified version in a conference committee.

How do you see the potential new national carrier hiring standards? Please share your insights in the comment section.

In January 2020, Cerasis was acquired by GlobalTranz, a leading technology and multimodal 3PL solutions provider. To learn more, please read the press release. If you are a current or prospective Cerasis customer, we invite you to reach out to us to learn how our combined capabilities can deliver new services, solutions and enhanced value to your supply chain. To learn more about GlobalTranz, please visit www.globaltranz.com.

Join 30,000 Plus Subscribers!

To subscribe to our blog, enter your email address below and stay on top of things. We'll email you with a confirmation of your subscription.


Subscribe!

Send this to friend