Glossary · Driver Life & Work
Percentage-of-Line-Haul (%-of-line-haul).
Driver pay model giving a percentage (typically 60-80%) of the freight line-haul rate; common for owner-operators leased on with carriers.
What it is
Percentage-of-line-haul pay gives the driver a percentage — typically 60–80% — of the freight rate paid to the carrier. It's the standard pay model for owner-operators leased on with motor carriers. A common arrangement is 70–72% of gross line-haul, with the carrier retaining 25–30% to cover dispatch, broker billing, factoring, insurance under dispatch, and overhead. Fuel surcharge (FSC) treatment varies — sometimes it's bundled into the percentage, sometimes it's passed through 100% to the operator. Accessorials like detention and layover are typically passed through 100%.
The model aligns the driver's incentives with rate quality rather than mile count. A 70% operator on a $3.00/mile load earns $2.10/mile; the same operator on a $2.20/mile load earns $1.54/mile. The driver bears both the upside (better rates = better pay) and the downside (slow market = lower pay). This is the key difference from CPM — the operator is exposed to the freight market's rate volatility in a way company drivers are not. Understanding what the carrier deducts before the percentage applies is critical: some carriers calculate percentage off gross line-haul; others deduct dispatch fees, comdata fees, or insurance pass-through before the percentage hits.
Why it matters for trucking finance
Percentage-of-line-haul aligns driver incentives with rate negotiation — drivers care about the per-mile rate, not just the miles. For lease-on owner-operators, understanding the percentage structure plus pre-percentage deductions is critical to actual take-home. Lender underwriting for percentage-paid owner-operators uses settlement statements to verify revenue history. Insurance for percentage operators reflects whether they're under the carrier's primary policy (when under dispatch) or need their own non-trucking liability (NTL).
Related terms
- Cents-Per-Mile Pay (CPM) — Driver pay model based on a fixed cents-per-mile rate for loaded (and sometimes empty) miles; the dominant pay structure for OTR truck drivers.
- Lease-On Driver — Owner-operator operating under a carrier's authority via a permanent lease arrangement; receives loads from the carrier and pays a percentage to operate.
- Non-Trucking Liability (NTL) — Bobtail coverage protecting an owner-operator leased on with a carrier when driving the truck for personal/non-business use.
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