Paying dividends

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During his 30-plus-year trucking career, it has always been Al Nunes’ philosophy that “if it isn’t safe, don’t do it.” But until a few years ago, the president of California-based A.C. Trucking didn’t really have a system to measure employees’ safety performance.

Now, as other trucking companies are facing large increases in liability insurance, Nunes is watching his rates stay steady and his company receive awards for safety. “Nobody looked at safety records as close as we do today,” he says. “Now, we show improvement every year.”

Four years ago, A.C. Trucking – the “A” stands for Al, and the “C” for wife Carol – began a quarterly review system of all its employees, not just drivers. Bonuses are tied to the review system, which focuses on 10 areas that affect safety and performance. Nunes brought in a safety consultant to verify the system and tweaked it for simplicity. Now, drivers, mechanics and office personnel know their quarterly bonuses depend on their attention to safety.

Given a fleet size of 25 company power units and 15 owner-operators, Nunes can and does perform the reviews himself. He follows a simple review sheet and uses the meeting to go over his expectations for his employees. Drivers are graded on their attendance and observance of work hours; grooming and proper dress; safety practices and driving record; attention to company policy; communication; quality and volume of work; willingness to accept change and direction; appearance of truck and care and operation of equipment; damage to loads or shortages; and logs and neatness of paperwork.

Each category has an effect on productivity and safety, Nunes says. He grades drivers on a line ranging from not satisfactory to superior. Employees rarely receive grades of above standard or superior for categories where they are expected to perform well, like attendance. Under the system, drivers receive points, which are used to calculate their bonus. Longevity also plays a roll in the bonus structure, which can reward a driver with as much as $1,500 a year.

Because the program rewards drivers on a quarterly basis, Nunes says there’s an incentive for an under-performing driver to improve immediately. They aren’t penalized for the whole year based on one quarter’s performance. Almost always, drivers improve after a negative review. Nunes hasn’t had to use the system to fire drivers, because if a driver doesn’t improve he usually leaves the company.

The attention to safety has paid off, not only in maintaining insurance premiums, but in recognition and publicity as well. In 2000, the California Trucking Association named the company as the safest fleet with revenues of less than $10 million. CTA reviews the safety and maintenance records of carriers as well as their on-road safety performance to determine award winners. There are 12 divisional winners, from which two are selected as safest fleets based on revenues. Prior to being named safest fleet, A.C. Trucking had finished first in its division for three straight years.

Nunes credits much of his success to veteran managers like Safety Director Don Gomes, who has been with Nunes since he started the trucking company 31 years ago. Gomes was recognized by CTA in 2001 as the California Fleet Safety Professional of the Year, an award given based on his professional qualifications as well as his success in advancing on-highway and workplace safety at his company.

“When we started looking to develop a good safety program we brought in a safety person who was a driver,” Nunes says. He believes that it’s important that a safety director interact with drivers as often as possible. Gomes sees his drivers daily, through a window that connects his office with the driver break room. “We put him next to dispatch so that he sees every driver every day,” Nunes says. “It’s a good opportunity to talk with drivers about safety.”

Nunes also credits his maintenance chief, Vern McBride, with helping to ensure safety in the shop as well. Although shop safety often gets less attention in the industry than on-the-road safety, the workers’ compensation situation in California makes it especially important. McBride, who like Gomes has been with A.C. Trucking for 31 years, helps evaluate mechanics with a program similar to one used for drivers. Before the safety program was instituted, there were several workers’ compensation claims that hurt the business, which is why the shop is included in the program.

Trucks and trailers are brought in for inspection on alternating months, and every truck gets a full mechanical inspection every two months. If there’s a problem, it’s fixed immediately. That attitude is passed on to drivers and helps keep them out of trouble on the road.

For 31 years, Don Gomes, Al Nunes and Vern McBride have kept an eye on safety with their Northern California trucking company.

Like drivers, mechanics are graded in 10 areas, although they are different: productivity; quality of work; knowledge and skill; work relationship with management and other employees; punctuality and dependability; innovation and resourcefulness; efforts to reduce shop waste; attendance; safe work habits; and care of company equipment.

Getting results
The review sheet was more complicated when it was first introduced in 1998, but Nunes quickly pared it down to simple points employees could quantify and improve on. The effect has been important to the company’s bottom line. Drivers show up at customers clean and dressed and their loads are seldom damaged or short.

Likewise, trucks are seldom placed out of service because the shop knows its bonuses are on the line. Across the board, the effort has impacted safety. “Workman’s comp claims used to be a big concern in the shop,” Nunes says. “But we haven’t had a problem there in a while.”

But perhaps the biggest benefit for the carrier is financial. “We’ve had no rise in insurance premiums this year,” Gomes says. “It’s a tool to keep rates down.” That’s important for a carrier with just $4 million in revenue – especially since A.C. Trucking lost two of his most experienced drivers to retirement. Experienced drivers tend to have the best safety record, but Nunes says individual attention and constant training can help overcome inexperience.

“When you see something they need correcting, you have to correct it,” he says. It’s also important to get an employee’s attention. That’s one reason why Nunes does the evaluations himself. “Since I’m able to evaluate, I have their ear. I can comment on the things they’re doing well and the things they’re not doing well.”

New drivers aren’t eligible for the bonus until they’ve been with the company 90 days, and they don’t tend to recognize the value of the program, Nunes says. But once they start getting checks for being safe, presentable and on time, they buy into it.

Nunes also encourages his drivers to compete in driving competitions and works with another carrier to practice for CTA’s yearly truck driving championship. The competitions, which focus on skill and safety, help keep the techniques of A.C. Trucking drivers sharp.

The effort towards safety not only helps keep insurance rates in check, it helps build business. Customers of A.C. Trucking recognize the effort, Nunes says, and send as much business his way as they can. “You are as good as you are safe,” he says. “I can make a truck and driver look great, but your record is what speaks for you. If a load is damaged, it doesn’t matter what you look like.”

The bonus and review program are saving money for the small regional hauler and helping in other areas, like driver retention, as well. But the most important function of the program relates to the bottom line: “How well we do as a business is directly correlated with safety,” Nunes says.