I’m new to the business and can’t seem to get a consensus about the best contract/arrangement for delivery drivers. What is the industry norm about wages? How much liability do I assume if the driver gets into an accident while delivering an order? Do I pay or contribute to the drivers’ insurance premiums? I could really use some sound advice from experts.
The industry norm is for drivers to get an above minimum hourly wage, fuel or mileage reimbursement (usually based on a per order basis) and of course tips. My drivers are at $6.00/hr + $1.50 per order they take + tips.
As far as insurance, the drivers’ insurance is meaningless. If s/he get in an accident delivering for you, their insurance company will tell them to pound sand (in about 99% of cases). Then the other person’s insurance company will sue you, because you have the deep pockets. As far as how much liabilty you assume… all of it. If your drivers kills somebody the other party is going to sue for millions.
You need a non-owned auto policy to cover you. I just dropped an old carrier for HRH insurance. They have a program with the NAPO and the rates are fantastic.
I pay my drivers 7 per hour 1 per delivery and they keep all their tips they average about 10-14 dollars per hour and on weekends make up to 18 per hour with everything added in. Insurance in Canada is different then what you have so all i can suggest is talk to an expert!
Pizzaguy
Do you have your drivers do anything but drive? Do you cover them under your WCB policy? Do you deduct payroll taxes?
I am currently going with contract drivers. Their company, car, insurance, etc. $3 for up to 1 mile $1 for each additional 1/2 mile automaticly set by the POS software.
I guess the pay for drivers would be different in other areas of the country. I’m in PA and we pay our guys min. wage 5.15 plus .80 a delivery (we keep .20) plus tips.
HRH tells me they won’t offer hired non owned since I do more than 50% of my sales in delivery. The only company I have found is Concklin and they want to charge me $18,000 per year. I guess I’m screwed if something happens until PJ finds someone to write a policy in Florida.
The problem with considering delivery drivers as independent contractors(as I understand it) is that you cannot schedule them, make them wear a company uniform, keep them from working for your competition among other things. In Florida, at least for construction workers(i would imagine it would be the same for drivers) the dept of labor has a new rule that independent contractors have to register a corperation or a LLC and file a workers comp exemption, or carry a policy. Good luck getting a part time driver to jump through those hoops.
Are you going without an insurance policy? Do you make sure the drivers have full insurance on their vehicle?
Here are a few articles you may want to read…
http://www.pmq.com/mag/2002winter/insurance.shtml
http://www.pmq.com/mag/2002fall/gianinni.shtml
There are a couple other issues with the “contractor” approach:
- It will NOT protect you if they are in an accident - you’ll still be sued and still therefore need an insurance that covers it
and - Being a contractor is carefully defined and a hot point with the department of labor. You can CALL them a contractor, they can THINK they’re a contractor, but they can then claim against you for unemployment or worker’s compensation if something happens. And you will get whacked with all kinds of penalties if it turns out that you were improperly calling someone who SHOULD have been an employee a contractor…
All my drivers are cross trained to do everything from make pizza to wash dishes. And are all under WCB etc. I dont have any contract drivers at this time.
The contract drivers I use are a LLC and look after all of their own taxes and insurance and yes they also deliver for other places but no other pizza places.