Since our last discussion in November, countless cultures across the world gathered with family and friends to celebrate various holidays, festivals and traditions. As a nation, our pride rests within our ability to practice these pillars of freedom, perseverance and faith, and recognizing the importance of spending time in reflection.
On December 8, 2010 the "transportation culture" collectively gathered to fight for its economic liberties by defeating "The Fair Playing Field Act of 2010"; a reform bill introduced by Senator Kerry (D-Mass) and Representative McDermott (D-Wash.) targeting independent contractor employment misclassification. The proposed bill sought to remove the Section 530 Safe Harbor provision (Revenue Act of 1978) amongst other initiatives1. The "safe harbor" protects businesses such as motor carriers and shippers, in utilizing and classifying workers as independent contractors for employment tax purposes.
As an industry, we collectively benefit from, and share in, the opportunities and efficiencies created by the independent contractor model. The reactive nature of this bill's approval would have strongly deviated from the pillars of freedom, innovation and self-identity this country was founded upon and further jeopardized transportation companies' use of independent contractor business partners.
With the onset of a new decade, what beliefs, practices and behaviors do you feel today's industry personnel should carry forward with them to preserve and maximize the independent contractor model?
Here are some of my reflections from 2010...
- Stay abreast of all industry issues, not just those which directly impact your business in the short-term. Adverse legislation and precedent can easily be avoided with an investment in holistic education, safety and risk management programs at every level of your organization. As proven on December 8th 2010, at times a simple letter of opposition to your Congressman will suffice...
- Go the extra mile. We are an industry looking for leadership and answers during this unfavorable regulatory and economic environment. In times of uncertainty, set the bar for performance at least one notch higher than the accepted standard or minimum.
- Invest in your people, and yes, this includes your drivers! To me, the quote below speaks volumes.
"Profit will determine who exists,
Technology will determine who competes,
Quality will determine who grows,
People will determine who wins."
As the government continues to focus on employment misclassification, I'll conclude with the same challenge as my last discussion, "What steps is your firm taking to continuously develop the skills, safety and business acumen of your professional, independent driver?"
Onward & Upward!
1 Amendments include increasing penalties for failure to withhold income and FICA taxes, and adding administrative work by requiring businesses to regularly provide independent contractors with written notice informing them of the federal tax obligations.