What kinds of regulatory safety audits are companies that use trucks up against?
Regardless of your business’ industry (transportation, construction, manufacturing, etc), any employer, employee, or vehicle involved in the transportation of property or passengers in interstate commerce, with a vehicle of gross vehicle weight rating (GVWR) or combination weight rating (GCWR) of more than 10,000 lbs., is subject to Federal Motor Carrier Safety Regulations (FMCSR).
Companies operating solely in intrastate commerce are subject to applicable state regulations regarding commercial motor vehicles.
The key to compliance with any audit is documentation. You may do all the required steps to comply with the intent of the rules or regulations, but if it is not documented, you are not in compliance.
We will go over the various types of FMCSA audits, discuss what a Corrective Action Plan (CAP) is, and show an example of how a well prepared CAP can save a company thousands of dollars in an audit where violations were found.
A FMCSA audit evaluates a company’s safety performance and confirms proper and complete recordkeeping. The review also determines if the company has adequate management controls in place to ensure compliance with the regulations. The audit can be pain-free if your company understands the regulations to which they are subject and what records the DOT expects to see. Conversely, an audit can result in thousands of dollars in fines by demonstrating a gross lack of compliance.
A FMCSA safety audit involves the examination of seven BASIC “factors” to determine the carrier’s compliance with the safety regulations and assist in establishing a sound safety program. The seven BASICs (Behavior Analysis Safety Improvement Categories) are:
- Unsafe driving
- crash indicator
- Hours of Service
- Vehicle Maintenance
- Controlled Substance and Alcohol
- Driver Fitness
- And HAZMAT, if your company carries Hazardous Materials
Your safety audit is going to be with either a Federal DOT officer or with a state agency that is contracted with the federal DOT to conduct the audit.
The audit is going to be safety related, it will not include anything that relates to IFTA, IRP, or OSHA, it will be focused on items that directly affect the company’s ability to operate a commercial vehicle, on highway, in a safe manner.
The DOT Audit can cover many different types of documents, such as:
- A driver’s hours of service
- Vehicle maintenance and inspection
- Driver qualification files
- Drug and alcohol testing
- Commercial driver license requirements
- Safety management controls
- And much more
Now let’s walk through the different types of DOT audits your company could face.
FMCSA New Entrant Audit
As a new entrant into trucking, your company will be required to go through a detailed DOT safety compliance audit within the first 12 months of operation, as the DOT will want to see some established records and processes, normally the safety audit will not be done until the carrier has been in operation for at least six months.
Non-compliance with any one of sixteen key audit areas in a new entrant audit will result in failing the audit and could cancel your operating authority.
This audit may be in person with a DOT officer or it may be an audit upload where you would upload the required documentation directly to the FMCSA website. Beyond the New Entrant audit timeframe, there are a few different types of Compliance reviews.
FMCSA Comprehensive Compliance Review
A safety audit or compliance review is an examination of a motor carrier’s records in all categories of safety compliance by a safety investigator from the FMCSA. Any motor carrier can be selected for a Compliance Review at any time but generally is selected due to multiple Safety Basics being over threshold or as the result of a serious accident or complaint. The result of this audit determines and assigns a safety fitness classification to a motor carrier of either Satisfactory, Conditional or Unsatisfactory.
FMCSA Focused Review
The DOT will generally conduct a focused review when just one of your BASIC scores is over the threshold or is following up after a Compliance Review was performed to ensure promised corrections have taken place. During the focused review, the DOT auditor will only review the specific area of concern identified and ask only for the records that support your compliance in the selected area.
This review can be conducted both off-site and on-site process. This review does not result in a safety rating but could receive a designation as un-ratable and possible fines if substantial non-compliance is discovered.
DOT’s Hazardous Materials Review and Security Review
A HAZMAT review is a very thorough review of requirements associated with transporting hazardous materials, such as, policies, training, shipping papers, placards, markings and labeling of containers.
The Security Review includes the security plan, training and other security-related measures. Security reviews often go hand-in-hand with a HAZMAT review if the company transports hazardous materials.
What happens if violations are found during a FMCSA audit?
In addition to hefty fines, once the FMCSA has assigned a less than satisfactory new safety rating or lowered a current rating, the process to upgrade that rating is daunting and time consuming, often taking months and many hours of work.
Of special note, a carrier assigned an Unsatisfactory rating has 60 days to prove to the FMCSA that deficiencies have been addressed or face an Out of Service order. As the DOT intervenes to correct a safety problem, they usually will require a detailed response, in writing, as to the corrective actions you have put into place. This is the Corrective Action Plan or CAP plan. The FMCSA gives itself 45 of those 60 days to review the CAP to determine if the rating can be moved up to Conditional. To avoid being shut down, an Unsatisfactory rated carrier has just 15 days to implement and document a successful Corrective Action Plan.
Glostone Trucking Solutions have successfully helped clients reduce their fines and have helped others through the upgrade process. We have the expertise to make it as quick and painless as possible.
Late in 2015 we had such a company reach out to us. They were recently audited and faced heavy fines. Here is their story.
We Faced Fines of Nearly $16,000!
For the sake of confidentiality, we will call this company “John Doe Trucking.”
John Doe Trucking faced nearly $16,000 in fines. Their violations included: having the wrong amount of insurance coverage, multiple Hours Of Service “HOS” violations (drivers not taking 30 minute breaks after 8 hours of being on duty), and not having an annual inspection for a vehicle.
After they received their Notice of Claim by the U.S. Department of Transportation, they reached out to Glostone Trucking Solutions asking for help.
In the case of John Doe Trucking, we helped them with Safety Management services (like our Compliance Kit), Log Auditing services and wrote a fine reduction request corrective action plan (CAP). The results were impressive.
We were able to reduce their nearly $16,000 fine by 30% (removing nearly $5,000) and got them reinstated and upgraded to a Conditional safety rating, all within one month!
To our understanding 30% is the largest reduction the DOT offers. In this case, the reduction was subject to no additional violations in each of these categories exceeding 10% and full payment of the fine. We were also able to establish a 12 month payment plan for the carrier.
If you are facing similar audit and fines issues, and you have all your paperwork together, we can typically write a letter on your behalf and get similar results for a fine reduction.