SPECIAL REPORT: VanPort strike task force wants mandated licence scheme; Questions O-O status

VANCOUVER — For-hire trucking operations in Canada have been deregulated for many years now, but the rules for hauling containers in B.C.’s Lower Mainland are likely going to get a lot stiffer soon. That’s the probable result of a report just released by the task force looking into this summer’s six-week trucker strike at the Port of Vancouver.

The governments of Canada and B.C. have released the final report, which explores the causes of the port strike and makes recommendations that would help avoid future labour disruptions at the ports of Vancouver and Fraser River.

Among the key suggestions is legislation to make permanent a 90-day interim licence provision the Vancouver Port Authority (VPA) implemented to end the strike. That came after several meetings between the Vancouver Container Truck Association (VCTA) — which was representing some 1,200 owner-operators — and carrier companies fell apart.

Say goodbye to the open market in the Lower Mainland
if the task force’s main proposal is OK’d

By signing the declarations, trucking companies, including dozens of long-haul carriers not involved in the original dispute, were required to adhere to the compensation provisions laid out by government mediator Vince Ready. Many carriers overwhelmingly rejected that proposal, but threatened by being shut out of the port, most of them signed up for the VPA licence anyway.

The task force acknowledges in its report that in consultations with stakeholders, both shippers and for-hire fleets pushed for a return to “the free market situation which existed at the beginning of the dispute.” The VCTA, on the other hand, expected the rate structure established by Ready in the original memorandum to be just the starting point for further adjustments.

But the task force claims it was “market failure” in the Lower Mainland container sector that led to the trucker standoff. Accordingly, it says that “standards for remuneration are necessary to address issues in the operation of the market for supply of trucking services, and that enforceability is required across the market place.”

Therefore it recommends that a new port licensing scheme be established and administered by the VPA and that the federal government pass legislation to create an agency with the authority to set compensation and conditions associated with eligibility for container-hauling work.

Two types of licences would be issued, explains the task force. “An owner-operator will be required to hold one licence to cover him and his truck. Companies providing drayage services by means of employee-drivers, owner-operators, or both will be required to hold one licence which will cover a specified number of specific trucks driven by employee-drivers (if any), and a specified number of owner-operators (if any).” Initially, any company owning trucks and providing short-haul container transportation services as of October 26, 2005, will be entitled to a number of licences equal to the number of trucks used in providing those services, the report states.

The implication is that there are no guarantees that licences would be issued to carriers wanting to ramp up capacity at the present time. However, the task force does add that an existing drayage company may be entitled to amend its licence to permit more trucks if it can demonstrate that it has attracted more business on a sustained basis. Also, when an owner-operator leaves a company or is discharged, the company should have the option to amend its licence to reduce the number of owner-ops by one, and to increase the employee-driver count accordingly.

While the proposal seems to apply mainly to short-haul container operations that were the focus of the strike, language in the report doesn’t seem to excuse unequivocally the long-haul firms that were so upset by being forced to abide by the provisional rule back in August.

“The Port Authorities will determine criteria for exemption from the requirement to obtain a licence for drivers involved in long-haul transportation and in transportation other than by container, and for emergency situations,” the task force states.

When the interim licence rule was tabled, B.C. Trucking Association president Paul Landry blasted the government for “inexplicably” accepting the provision to include hundreds of other fleets in long-haul operations, with “entirely different business models and compensation agreements” than what the VCTA drivers were negotiating.

As with the current provision, company licences would be subject to a requirement to pay fair compensation to owner-operators and employee drivers — a system that would be under the watchful eye of “licence adjudicators.” These officials (the task force recommends Vince Ready for such a title) would establish their own procedures and would have the status of arbitrators under the relevant Commercial Arbitration legislation.

Drivers covered by a collective agreement would be presumed to receive fair compensation. But from time to time the licence adjudicators or legislated agency would determine a standard of fair compensation for non-union drivers (with separate provisions for owner-operators and employee-drivers), and would also determine compliance with the “fair compensation standard.”

For their part, owner-operators with licences would not be able to participate in any concerted refusal to work, or “any interference with transportation to or from the ports, except as permitted by law.” Furthermore, the recommendation prohibits picketing by truckers at or near ports — even in the case of legal strikes.

Independent status for port owner-operators may soon
come under the microscope

And then there’s the question of owner-operator independence.

Another major recommendation of the task force is that the Canada Industrial Relations Board “at the first available opportunity” determine whether owner-operators are dependent contractors under the Canada Labour Code and have access to collective bargaining.

“We have uncovered a significant body of anecdotal evidence that could lead to the conclusion that the large majority of owner-operators are in fact dependent contractors under labour legislation largely because they appear to be economically dependent upon individual trucking companies for their income,” the task force states. “We were informed that most of the owner-operators do not work for more than one trucking company and do not have significant sources of income outside the revenue received from their particular trucking company.”

The task force goes on to say that a significant number of applications for certification have been made to the CIRB and also to the British Columbia Labour Relations Board on behalf of certain owner-operators (VCTA lawyer Craig Paterson recently confirmed to Today’s Trucking that many VCTA truckers are joining the Canadian Auto Workers union).

“The existence of these applications supports our view that these owner-operators consider they are entitled to access to collective bargaining,” says the task force report. “If it is decided by the CIRB or the B.C. Labour Relations Board that the owner-operators are capable of being represented by a trade union under labour legislation, we recommend thereafter that the relationship between the trucking companies and the owner-operators be treated as one which is governed by conventional labour relations …

“This includes treating owner-operators as ’employees’ for purposes of regulating work stoppages under applicable labour relations legislation, whether or not they choose to unionize.”

As Today’s Trucking readers may know, the CIRB is no stranger to the question of independent status for owner-ops. In the infamous “Mackie decision” of 2002, the CIRB ruled that the Teamsters union could bargain for about 200 independent owner-operators and agency drivers contracted to Oshawa, Ont.-based Mackie Moving Systems.

Many issues affected that decision, but the CIRB said the critical factor was the day-to-day control Mackie had over the contract workers. The fact that Mackie determined the drivers’ hours and salary, issued ID badges, trained the drivers, and disciplined them made the drivers de facto employees under the Canada Labour Code and thereby eligible for collective bargaining.

These are precisely the kinds of issues the task force is asking the CIRB to look at if it decides review the status of independent Vancouver port truckers.

In fact, this is an unresolved issue that stretches further back into the 1980s when a group of owner-operators contracted to a small Newfoundland carrier demanded holiday pay. It has been hanging over the industry ever since.

Upon Further Review:

There are dozens of other recommendations inked in the task force report. A few others include:

VPA terminal operating hours should be increased beyond the current single shift operation until present congestion experienced by truckers is significantly reduced.

The task force acknowledges constraints within International Longshoremen’s & Warehousemen’s Union contracts that affect the economics of longer hours. It also recognizes that off-dock terminals, importers, and exporters would likely have to adjust their operating hours to a change in terminal operations. It believes, however, that a permanent increase in open hours at truck gates would contribute significantly to addressing queuing delays at terminals.

“Co-ordination between the Vancouver Port Authority and the Fraser River Port Authority is essential for benefits to be obtained from implementing changes in operating hours,” the report states.

Furthermore, the task force believes that an improved reservation system and possibly centralized dispatch could increase efficiency at the port. “We believe that a decision to adopt a reservation system should consider making it mandatory, applicable to all Lower Mainland terminals, and include penalties for misuse as well as rewards for compliance with the system. Costs associated with developing and implementing the system should be prorated among stakeholders involved.”

The entire task force report can be read at: http://www.tc.gc.ca/pol/en/reportContainersBCLowerMainlandPorts/menu.htm