The ‘Agent Model’ is commonly used by motor carriers operating with independent contractors (“ICs”) to increase capacity in various markets. The model allows the motor carrier to align certain increased costs; e.g., sales, administrative, recruiting ICs, with a payment structure that is based upon the agent’s productivity. A common misconception is that the model in itself distances the motor carrier from the ICs by virtue of the agent acting as an intermediary. Sometimes the ‘agent’ is just an ‘agent’ performing some or all of the functions mentioned above, while at other times the ‘agent’ may also be a small fleet owner that provides equipment/drivers to the motor carrier. Both scenarios require the motor carrier and the agent to carefully consider the elements of control between the parties to preserve the intended independent contractor, vendor/vendee type of relationship.
Please see full publication below for more information.