Could a recently surfaced email from C.H. Robinson shows the nation’s largest freight broker is starting to tighten motor carrier requirements, giving truckers glimpse into the future of freight brokering after the landmark Supreme Court ruling.
For years, brokers have been accused of knowingly hiring unsafe motor carriers because those carriers will accept cheaper rates. With only a few courts finding brokers liable for crashes involving those carriers, some brokers may have felt incentivized to continue the practice.
That all changed on May 14, when the Supreme Court ruled in Montgomery v. Caribe Transport II that brokers can be found liable for crashes involving motor carriers they should have known were unsafe. C.H. Robinson was the broker at the center of that case.
Since then, there has been wild speculation over what that decision will mean for trucking freight. Predictions have ranged from doom-and-gloom to a major victory for smaller carriers.
Trucking stakeholders have been waiting for the other shoe to drop after the Supreme Court decision. C.H. Robinson may have given the industry the first smoke signal.
The question on everyone’s mind has been, “How will brokers react to the Supreme Court ruling?” Answers to that question are already coming in.
C.H. Robinson, the freight broker at the center of the Supreme Court case, told Land Line in an email about changes to how it will conduct business with motor carriers moving forward.
To start, C.H. Robinson is raising its insurance minimums from the federal requirement of $750,000 to $1 million. The company has processed contracts with carriers that held the federal minimum in the past. However, those carriers likely had limited freight availability. Now, those carriers will have no loads offered to them until they obtain $1 million in liability insurance.
C.H. Robinson is further restricting which carriers it works with based on safety ratings. The freight broker is now ending its practice of working with carriers that have a “Conditional” rating. Additionally, it will now have a seven-day wait period for new authorities. Carriers who are identified as “high-risk using internal metrics” will also lose eligibility.
Owner-operators on Reddit are claiming they are being dropped by C.H. Robinson. In a post from May 28, one user said he received an email from the broker notifying him of a status change to “non-certified.” According to the post, the change resulted from the carrier’s Federal Motor Carrier Safety Administration score. The Reddit user claims the safety rating is “none.”
Another user posted a screenshot of an email allegedly from C.H. Robinson about changes to carrier eligibility. Part of the email reads:
“Our records show your company, [redacted], exceeds intervention thresholds for C.H. Robinson’s scoring model based on data from the FMCSA. Effective immediately, your account will be moved to a non-certified status until your BASIC scores improve. This change aligns with our broader efforts to maintain a network of carriers that meet consistent safety and compliance standards.”
C.H. Robinson told Land Line that carriers that have been notified are “encouraged to upgrade their qualifications and rejoin our network.”
Intervention thresholds are set at 65% for the unsafe driving, crash indicator and HOS compliance categories. For all other categories, the threshold is 80%.
However, Safety Measurement System (SMS) scores are hard to come by and less precise for smaller carriers. A Government Accountability Office report revealed that most carriers lack sufficient information to reliably compare safety performance across all carriers. Small carriers will have fewer inspections than carriers with hundreds or thousands of trucks. That smaller sample size could artificially raise or lower scores.
That report revealed that very few carriers had an SMS in any particular BASIC category.
According to C.H. Robinson, carriers that received notification letters represent less than 1% of annual North American truckload volume.
“Following the U.S. Supreme Court’s Montgomery v. Caribe Transport decision, C.H. Robinson communicated that our freight overwhelmingly moves safely, with just one serious accident claim per 500 million miles driven on customers’ loads,” C.H. Robinson said in a statement. “As part of our commitment to continuous improvement and building on our already industry-leading practices, we’ve taken further steps to improve the safe transportation of the freight we broker.”
Regarding FMCSA safety ratings, about 94% of the more than 2 million active interstate motor carriers have no safety rating. Of those that do have a rating, nearly a quarter have a Conditional or Unsatisfactory rating. That means only 2% of all active carriers have a Satisfactory rating.
Truck drivers have been calling for SMS reform for years. The Owner-Operator Independent Drivers Association said recent updates to the system fell short of “comprehensive overhauls needed to accurately identify at-risk carriers and reduce truck crashes.” In comments submitted to FMCSA, OOIDA called the system flawed.
“In reality, no theory, mathematical equation, or model can overcome poor data quality. CSA/SMS is a prime example of ‘garbage in, garbage out’ (GIGO), which refers to the fact that the quality of output is determined by the quality of input,” OOIDA’s comments stated. “Moving forward, we believe a major overhaul of CSA/SMS is still required.” LL
Credit: Source link
