Sometimes, amid the day-to-day activities all fleet managers must face, it seems much of what is done is entirely reactive. "Closing the barn door after the horse gets out" can be frustrating and counter-productive; however, experienced fleet managers know actions can be taken to keep that door closed in the first place.
Giving an employee the keys to a company truck entails risk — the risk that he or she won’t operate the vehicle in a safe manner, take proper care of it, or follow company policy and procedure. Managing these risks begins before the driver is hired and is an ongoing process that can provide substantial savings and cost avoidance.
What are the Risks?
The risks associated with the provision of company trucks to employees go beyond legal issues. Before discussing what assessments can be performed, it is first necessary to define the risks. They can be placed under several categories:
- Financial. The most obvious risk (though not necessarily the most serious) is financial. Placing employees in a company asset costing tens of thousands of dollars, which generates thousands of dollars of expense during its time in service, carries with it substantial financial risk.
- Safety. The safety of the driver and the general public is at stake every time a fleet driver gets behind the wheel.
- Liability. Placing an employee in a company truck also places the company in a position of responsibility for all the driver’s actions. A company’s reputation in the community and industry is one of its most important assets.
The first step in proposing a driver assessment program is to define specifically what risks the program will track and control, and what resources and tools the fleet manager sees most effective. For example, the most common (and important) assessment tool is the motor vehicle record (MVR). While it may seem common sense that the company has the right to review the driving record of an employee entrusted with a company vehicle, legal and policy issues must be addressed first.
- Various other checks can assist the fleet manager with assessing the risks of allowing employees to operate company-owned trucks:
- Criminal background checks.Credit checks.
- Previous employment/references.
Each of these, obviously, carries even more potential legal issues than the simple MVR review, and management is responsible for deciding if these issues can be addressed and if the effort involved in addressing them outweighs the benefit.
Driver assessment involves a number of corporate disciplines and departments. Before instituting the program, each should be directly involved in its development. At minimum, these departments should include:
- Fleet.
- Risk management/treasury.
- Legal.
- Human resources.
- Drivers (sales, service, etc.).
- Senior management.
Representatives from each department or function should provide input and advice in development of any driver assessment programs.
Next, specific risks the program is meant to assess should be outlined. These include:
- Safety.
- Liability.
- Cost.
Finally, once the program has been developed, approved, and implemented, each driver should be provided a copy of the fleet safety policy to review and sign, before hire for new employees and after hire for existing drivers.
Safety Begins with MVRs
A basic fleet management function is providing for the safety of fleet drivers and the public with whom they interact. Assessing driver safety risks begins with MVR reports.
MVRs are available from every state and come in several different formats. In addition, most large fleet lessor and service companies offer MVR programs. The primary advantage of such programs is a single format for all reports.
Safety risk assessment should be initiated before a driver is hired. An MVR review should be part of any pre-employment screening and continue on a regular schedule (quarterly, semiannually, or annually) for as long as the driver is employed.
Clearly, some violations carry the potential for greater risk than others:
■ Equipment violations do not presage serious safety risk and are often simply a matter of bad timing (a bulb burns out and the driver is cited before having it repaired).
Don’t, however, overlook these minor issues completely. A record that indicates a pattern of such violations might reveal a lack of care for the vehicle, which can ultimately incur additional expense.
■ Moving violations pose a serious risk at various levels and should be acted upon. At the lowest risk level are violations such as failing to signal or yield right-of-way. Higher up in the scale of risk are more serious violations, such as failing to observe traffic controls (stop signs or lights) and speeding. These violations can pose serious risk to the company if a vehicle is assigned, and they demand immediate action by the company.
■ The most serious violations can be felonies, such as driving while impaired or reckless driving, even speeding beyond a state-imposed threshold (more than 25 mph over the posted limit, for example). For new-hire candidates, these violations should bring a pause to hiring, and for existing drivers, serious penalties such as suspension of driving privileges and up to and including termination.
All new-hire candidates should be informed clearly that prior to employment, their MVRs will be reviewed before they are allowed to drive a company truck.
Once the MVR has been reviewed, the policy should outline steps that will be taken if the record reveals violations the company considers risk indicators. For example, a single moving violation in a driver’s record might call for probationary use of a company truck for a year with any subsequent violations resulting in suspension of privileges.
Similar actions can be taken for existing drivers. The assessment policy should call for an MVR review on every driver at least twice each year. For larger fleets, these semiannual checks can often reveal one or more drivers who do not have a valid license, such as a commercial driver’s license (CDL). Few things carry more risk than operating a vehicle with an invalid license. The driver should be immediately removed from behind the wheel of the company truck and prevented from conducting any company business that requires driving.
Many companies assign points to various violations. Accumulation of points triggers company-instituted actions. However it is done, the safety of the driver and the general public, and the company’s reputation in the community are foremost in importance, with the costs associated with such risk an additional consideration.
As previously described, MVR reviews can reveal other risks. Drivers who are prone to or do not follow up on equipment violations can apply such inattention and sloppiness to their job and how they treat other company assets. Obviously, a driver who has been cited for DWI isn’t a good candidate for any job; overall contempt for the law isn’t a quality desired in a potential employee.
Drivers Pose Other Cost Risks
The risk of incurring unnecessary cost is a bit more difficult to assess, but indications can be flagged if the overall program is well-structured. A driver who incurs multiple equipment violations may bring the same cavalier attitude to the overall maintenance of a company truck and to the job in general.
Vehicle condition reports are an excellent tool in tracking cost risks. Reports (and any accompanying photographs) that reveal unusual wear and tear or accident damages unaddressed in a subsequent report may indicate the driver is incurring other costs in using the vehicle. Those costs, if not controlled, can cost thousands of dollars in resale value when the vehicle is sold. In addition, if the vehicle is not maintained in peak condition, its safe operation may be compromised, opening the door for liability risks.
For ongoing risk assessment, an accident review process can be very helpful. Accidents are a simple fact of fleet life; determining the driver was at fault or if he or she did everything possible to avoid a crash can provide insights into the risk the driver poses. Accident review committees usually consist of representatives from several disciplines, including fleet, risk management, and driver functions. They may also include legal and human resources, particularly if there are strict penalties for chargeable accidents.
Developing & Implementing Risk Assessment Programs.
Involving all relevant company functions is a critical component in developing and implementing a risk assessment program. Most importantly, the company’s human resources and legal departments must provide input when personal records of an employee or prospective employee are reviewed, especially when that review will impact the hire or continuing employment of the driver. Drivers should be made aware of the policy (and the overall fleet policy as well) and should "sign off" on it, providing permission/approval for the company to proceed.
Once implemented, the program must be applied and adhered to in all instances, without exception. Anecdotally, a large company in the Southeast found itself hit with a multimillion dollar penalty when a driver was involved in an accident in which a third party suffered serious injuries. Even though the driver wasn’t at fault, attorneys for the other party discovered that while the company had an MVR review policy, it could not produce proof the review had been obtained for this particular driver. It is every bit as risky to develop a policy, but not enforce or follow it, as it is not to have one at all.
To recap, assessing driver risk, because of the serious consequences of not doing so, is an important segment of a successful fleet program. Program development should include all stakeholders and responsible parties, and, when implemented, must be applied consistently and without exception. Doing so can help a company avoid substantial cost, both in liability and in vehicle costs, and maintain its reputation in the industry and the community.
