Going to school and earning a CDL is the best way to start a truck driving career. Upon graduation, though, new drivers have a few choices for seeking out truck driving jobs. Those choices cover everything from employment status to where the driver will actually work. In terms of employment status, drivers can either be employed by carriers or work as independent contractors.
At C.R. England, one of the country’s largest and oldest refrigerated trucking companies, recruiters are always looking for both employee drivers and independent contractors. They value the services of both. But they say drivers need to carefully weigh the pros and cons of each kind of employment before deciding how they want to proceed.
Independent truck driving is seen as the more lucrative option for drivers who want to be self-employed. To that end, some research is necessary in order to fully understand what it means to be independent. Below are some important things new drivers need to know.
Owning or Leasing Equipment
Independent truck driving jobs require the trucker to supply his or her own equipment. This can be done in one of two ways: purchasing or leasing. Purchasing is obviously more expensive upfront, but it also results in a tangible piece of equipment the truck driver will own once the loan is paid off. Leasing is completely different.
Truck drivers who choose to lease also have two options. The first is to lease equipment from a truck supplier in the same way a car owner might lease a car from a local dealer. Of the two leasing options, this is the better one as it separates the driver’s equipment from the companies he or she hauls for.
The second option is to lease from an employer. The positive side of this arrangement is that the employer guarantees the driver work, thus eliminating the need for the driver to find his/her own work. The negative here is that the employer still controls pretty much everything the driver does. Leasing directly from an employer almost defeats the purpose of being independent.
Independent truck drivers are responsible for their own equipment maintenance, both in terms of getting it done and paying for it. This is why independent truckers tend to make more per mile. They need that extra money to cover equipment costs while, at the same time, employers can afford to pay more because they don’t have to absorb the costs themselves. Having said all that, independent truck drivers have to take good care of their equipment if they don’t want maintenance costs to break the bank.
Taxes and Reporting
As independent truck drivers are self-employed business owners, they are responsible for their own taxes and reporting. That usually means paying federal and state income taxes quarterly, along with filing annual returns just like any other taxpayer. There are some special circumstances that might require extra reporting.
Insurance and Benefits
Employed drivers benefit from the fact that their truck driving jobs include insurance and fringe benefits, such as healthcare coverage, for example. Independent drivers must pay for those things themselves. Again, this is yet another reason why owner-operators earn more money per mile. They essentially need to charge enough to meet all their own financial obligations and still make a profit.
There are positives and negatives of being an independent truck driver. But the same holds true for employed drivers. There is no best way for every driver in every circumstance. Therefore, it’s up to each driver to assess his or her own circumstances to determine which of the two employment options works.