2019 State of Delivery Trend Report Finds That Employers Are at Risk of Lawsuits, as 82 Percent of Employers Don’t Ask Workers to Track Mileage in Any Way
BOSTON, Mass., January 30, 2019 – Motus, the premier vehicle management and reimbursement platform, today released its 2019 State of Delivery Trend Report, which reveals key data related to current delivery trends. The report identifies a broad range of trends surrounding the delivery industry, including the gig economy, associated costs, employer sentiment, driver tenure and more.
The report revealed that the current driver reimbursement methods being used nationwide are leaving employers susceptible to lawsuits. State and federal labor laws require employers to accurately reimburse workers for the business use of their personal vehicles. However, 82 percent of employers don’t ask workers to track mileage in any way, 39 percent reimburse their delivery workers with a flat amount, 24 percent include the use of employee vehicles and vehicle-related expenses in the employee’s wage and 10 percent reimburse employees for mileage.
“Legally, employers must ensure that fuel, maintenance and other costs of owning and operating a vehicle are accurately reflected in employee reimbursements,” said Ken Robinson, market research analyst for Motus. “Employers may not realize the impact driving costs can have on delivery workers’ wages. In some areas of the country, failure to fairly and accurately reimburse employees can mean that a delivery worker’s expenses are not fully covered, thereby impacting and reducing their take home wage and opening up their employers to potential lawsuits.”
The report provides examples of major U.S. cities where using a flat amount per delivery can impact delivery workers’ actual wage. For example, when a flat amount is paid per delivery in New York, NY, the high costs of driving in the city significantly decreases the average delivery worker’s take-home wage.
“Businesses that employ delivery drivers need a solution that tracks the true costs and expenses that employees incur, so that they can reimburse them with the actual amount they deserve,” said Craig Powell, CEO of Motus. “The Motus solution provides store owners with custom mileage reimbursement rates that cater to the unique needs of the delivery industry and incorporate both fixed and variable costs. The rates calculated by Motus reflect real-time costs customized to each store location, giving companies an automated, labor-compliant mileage reimbursement program.”
Additional findings in the 2019 State of Delivery Trend Report include:
- 31 percent of employers said that the most important factor when hiring a delivery worker is finding someone with the ability to represent the brand well. 25 percent cited a safe driving record, 22 percent pointed to availability, 10 percent value a driver’s ownership of a vehicle, 8 percent relevant experience and 4 percent cited other factors as the most important to consider when hiring delivery workers.
- An overwhelming majority of employers use their own employees to deliver their goods and services (79 percent). However, at the same time, many have started to explore the world of using third-party vendors, contractors or gig workers to deliver goods (21 percent).
- Employers are largely undecided about whether they’d hire on-demand or gig workers to deliver their goods. 28 percent said they would hire gig delivery workers, 38 percent said they would not and 34 percent admitted they were unsure.
- 86 percent of respondents reimburse or credit customers for incorrect orders or late deliveries. Incorrect orders/late deliveries cost 60 percent of businesses $100 or less each month, but for an unlucky 20 percent, these costs balloon to in between $100 and $500 a month.
To access the full report, please visit here.