In 2017, the idea of a Federal Motor Carrier Safety Administration off-site audit rarely crossed the minds of carrier executives, and with good reason — FMCSA almost never conducted one.
In fact, in 2017 and 2018, FMCSA conducted just 329 off-site audits in total as it trialed the process. That changed in 2019 when the agency ramped up the program, conducting 1,374 audits. Last year, in part because of the COVID-19 pandemic, that number jumped to 5,551 audits — 50.5% of the total audits conducted.
Even as the pandemic has subsided, off-site audits have not. Year-to-date, there have been more than 3,700 off-site audits, according to FMCSA data. The reasons are clear: Off-site audits are both cheaper and less time-consuming. In a 2017 report to Congress, the agency noted an off-site audit takes 33% less time to complete and saves FMCSA 58% on travel costs.
According to FMCSA 2020 data available online and analyzed by J. J. Keller & Associates, the average settlement resulting from an audit in 2020 increased to $11,000, up from $6,650 in 2019, and 93% of all audits resulted in at least one violation. An overwhelming proportion of carriers audited — 82% — had 20 or fewer power units. Only 31% received a satisfactory rating in 2020.
With off-site audits sticking around, carriers need to be prepared. In some cases, a carrier may only have 48 hours to transmit an electronic record to FMCSA auditors upon request. Missing even a single document from a driver qualification file is a violation and could sideline that driver and load until the issue is resolved.
In addition, any incident involving that driver during that period is sure to draw the interest of a plaintiff’s lawyer.
“With today’s nuclear verdicts and increasing audit risk, proper records management is more important than ever,” advised Daren Hansen, J. J. Keller senior transportation editor. “Technology makes recordkeeping easier than the old days of paper files, and motor carriers need to leverage that technology to reduce their risk.”
Recordkeeping permeates every aspect of a carrier’s business, from human resources to maintenance, from drivers to OSHA compliance. Failure to maintain proper records, to have those records available when needed, or to store them for the necessary periods of time leads to violations.
Using paper records adds time and additional steps to the process of collecting and storing documentation. Switching to electronic records alleviates much of the burden of compliance. It doesn’t eliminate the need to maintain proper records, but it makes the process easier. Documentation is the only proof a carrier has that it is compliant with driver qualification, drug and alcohol testing, hours-of-service, fuel-tax, and many other rules and regulations.
“Motor carriers need to keep many records. Maintaining those records on paper is a liability, not to mention the time and expense it costs to maintain them,” Hansen noted.
In January, the J. J. Keller Center for Market Insights conducted a survey of fleet managers and proper recordkeeping was at the top of the list. The online survey of 662 motor carriers found that 24% of respondents have trouble maintaining records in a single location where they can be easily and quickly located to prove compliance. They are also challenged by maintaining accurate and organized files related to driver qualification (23%) and drug and alcohol testing records (15%). A further 31% said they struggle to know quickly when a driver becomes noncompliant. Fifteen percent of drivers struggle with how to show compliance during roadside inspections.
During an audit, FMCSA may request and inspect:
- Drivers roster
- Driver’s license documents
- Drivers’ records of duty and supporting documents
- Motor vehicle records
- Medical certificates
- Vehicle lists
- Vehicle inspection reports
- Hazardous materials paperwork
- Proof of insurance
- Drug and alcohol testing program documentation
- Accident register
“With so many hats to wear, today’s fleet managers don’t have time to deal with paper records and all the problems and risks they can entail,” Hansen said. “Electronic records give them quick, easy access and control, so they can rest easy knowing their documentation is all in order and they will be prompted when actions need to be taken.”
Benefits of electronic records
The myriad of recordkeeping requirements for today’s fleets has made electronic recordkeeping a necessity. Key benefits of switching to electronic records include:
1. Accessibility. Records are easily accessible and searchable from any location. Access can also be limited and monitored to ensure only those authorized to view the records are doing so. And in the case of an audit or litigation, relevant records can be collected quickly and in a cost-effective manner.
2. Compliance. For maintaining compliance, electronic records have no equal. They are more easily audited by both internal and external auditors, and errors can be quickly located and corrected. This includes missing or misfiled documents. In the case of an FMCSA audit, the records can be gathered and transmitted quickly.
3. Maintenance. Maintenance records are increasingly being converted to electronic records. Doing so can save time and trigger automatic alerts when inspections or expiring documents need to be updated, allowing carriers to be proactive with maintenance and in compliance with maintenance regulations. An electronic recordkeeping system can help ensure that all required documents have been completed and prompt you if something is missing.
One often overlooked aspect of electronic records is the ability to purge out-of-date records. Holding on to records that are no longer active or relevant could add liability to a carrier should an attorney get access to such documents.
Paper-and-pen processes may have worked 50 years ago, but the increasing digitization of the world means carriers need to keep pace. Converting paper records into electronic documents saves time and cost, and reduces risk — both safety and legal. If a carrier has yet to investigate digitization of their records, they should. The Encompass Fleet Management system not only provides electronic storage and management of records, but also delivers compliance guidance for the complex requirements fleets face, like driver qualification and alcohol and drug testing.
Electronic recordkeeping is no longer a nice-to-have, but rather a must-add to modern fleet management.