Less-than-truckload carrier Con-way Freight is enhancing its compensation package for drivers, increasing current pay rates and reducing the time it takes for drivers to reach the top pay scale, according to a Tuesday announcement from the company.
The changes will be effective in January 2015.
Con-way Freight said it will align all of its locations with a common advancement schedule in which drivers will reach the top scale three years after being hired.
“Our simplified pay structure enables us to more effectively align driver pay with the market-based cost of labor and provides increased flexibility to react to market conditions over time so we can ensure our drivers’ compensation remains competitive,” said Greg Lemkuhl, president of Conway Freight.
The carrier has been evaluating and implementing changes in its compensation program to reflect the evolving market conditions and ensure competitive pay structures for its drivers, accordign to Con-way.
“Our LTL company, along with Con-way Truckload, is facing the most pronounced driver shortage we’ve ever seen,” said Douglas Stotlar, CEO of parent company Con-way Inc. “This action benefits our people, our customers and our shareholders and is supported by the improved profitability and efficiencies being delivered by Con-way Freight’s 21,000 employees.”
The industry analysts at Stifel Transportation and Logistics Research said that the pay and advancement restructuring at Con-way Freight is a reflection an alignment of all of the carriers under the Con-way name.
In an email to investors, David Ross, a managing director at Stifel, said they did not believe other public LTL carriers will follow Con-way's lead and are not a part of a wider industry trend. Truckload carriers, however, will continue to see more significant driver pay pressure that LTL carriers, he said.