In recent months, news stories and discussions on Reddit threads, Facebook groups, and industry publications have illuminated a growing crisis within the Canadian transportation industry. The issue is not just about on-road safety or the rate crisis anymore—it's about the financial instability plaguing commercial carriers across Canada and the United States. Every day, companies are declaring bankruptcy, leaving behind millions of dollars in unpaid wages, truck leases, and taxes. Yet, transportation regulations and safety codes often ignore these issues, focusing solely on a carrier’s road performance.
Take, for instance, a house-moving company in southern Alberta that has recently caught the attention of the Alberta Government's Red Tape Reduction department due to allegations of financial mismanagement and incomplete work. Or the case of Pride Group, a major Ontario-based trucking company that recently went bankrupt, leaving behind enormous debts. These are not isolated incidents—they’re part of a growing trend in the transportation industry, and it's time we addressed the broader implications.
The Gap in Transportation Oversight
During my time in public sector investigations, I’ve seen firsthand the fallout from these financial crises. Over the years, I’ve handled countless complaints from employees who were left without wages. Despite these concerns, transportation regulations in Canada, such as the National Safety Code (NSC), don’t include provisions for monitoring a carrier's financial health.
Alberta Transportation & Economic Corridors, Traffic Safety Services Division, Monitoring & Compliance Branch, Investigations & Enforcement Section monitors on-road performance with the non-functional carrier profile system but, there is no obligation to consider over-all carrier health that is not safety related. This leaves a massive gap in regulatory attention. For instance, the house-moving company mentioned earlier currently holds a "Satisfactory" Safety Fitness Certificate (SFC). A citizen conducting due diligence before selecting a carrier may view a Satisfactory rating as including overall performance and compliance to the regulations. However, the reality is that financial instability in transportation companies can lead to deteriorating safety standards. Carriers in financial trouble don’t pay the bills, the drivers, or for expensive truck maintenance. Tires are expensive and if a carrier is at the point of not paying wages or completing work already paid for you know those tires are bald and the ABS light is on.
The Consequences of Ignoring Financial Health
When we overlook the financial well-being of carriers, we're putting more than just paychecks at risk—we're endangering lives. Commercial carriers facing bankruptcy aren’t just skipping wages or taxes; they're skimping on truck repairs, neglecting safety checks, and pushing drivers to operate under less-than-ideal conditions. These are ticking time bombs on our roads, and yet, there is no requirement in Alberta’s Transportation Ministry Business Plan for 2023–2026 to address this issue.
The Alberta Transportation Ministry Business Plan for 2023 – 2026 stated, The ministry ensures a robust legislative and regulatory framework is in place to protect Albertans. Legislation and regulations are reviewed and refreshed to align requirements with emerging transportation related best practices, issues and technologies. The ministry’s focus is on ensuring "a robust legislative and regulatory framework" that protects Albertans, but the framework is incomplete. The National Safety Code and provincial regulations focus solely on road safety and compliance. They ignore critical factors like financial health, which can directly impact safety. Without a complete picture of a company’s stability, it's impossible to truly gauge its ability to operate safely in the long run.
Conclusion: The Need for a New Approach Transportation is a vital part of the economy, and the financial instability of carriers is an issue that can no longer be ignored. To protect both the public and industry workers, regulatory bodies must start evaluating the overall health of carriers. The stakes are too high to focus only on road performance. It’s time for the leadership group of Alberta Transportation & Economic Corridors, Traffic Safety Services Division, to take an interest in the industry they monitor. Read the news, follow some public Facebook groups, get Redditt. It cannot always be about the Economic Corridors part of Transportation and Economic Corridors, transportation needs some attention also.
As an Alberta-based carrier, understanding the intricacies of Safety Fitness Certificates (SFC) is essential for compliance and avoiding costly penalties. A common question that arises is whether an Alberta-based carrier with a Provincial SFC can operate outside of Alberta by simply purchasing permits in other provinces like British Columbia or Saskatchewan. The short answer is no, and here's why.
Intra-Provincial vs. Extra-Provincial: Know the Difference
First, let’s clarify the two types of SFCs:
It’s crucial to understand that an Intra-Provincial SFC does not give you the flexibility to temporarily operate outside Alberta by buying a permit in another province. The permits available in British Columbia and Saskatchewan that many carriers refer to are for vehicle registration (IRP) and fuel tax (IFTA) purposes, not for operational authority. This common confusion often leads carriers into regulatory trouble. Yes, I know your cousin’s uncle that owns a trucking company has been doing it for years but, that just means they haven’t been caught yet.
Why Permits Don’t Equal Permission
Many carriers mistakenly believe that purchasing a permit for registration or fuel tax allows them to operate extra-provincially. However, these permits are solely for the legal use of highways (registration) and the payment of fuel taxes. They do not grant you the authority to pick up or deliver loads outside Alberta.
The responsibility of understanding the need for a Federal SFC falls on the carrier. Unfortunately, Transportation & Economic Corridors, Traffic Safety Services Division do not provide education on this requirement. Alberta Transportation & Economic Corridors, Traffic Safety Services Division, Monitoring & Compliance Branch, Investigations & Enforcement Section focus is on compliance, and they expect carriers to be informed about the regulations governing their operations.
The Siloed System and Its Impact
One of the reasons carriers often find themselves in violation is the lack of communication between various government departments. Transportation & Economic Corridors, Traffic Safety Services Division, the departments responsible for permits and those overseeing SFCs operate in silos. This means that when you obtain a permit from one department, there is no cross-communication to inform you of other regulatory requirements, like the need for a Federal SFC.
This disconnect often results in carriers unintentionally violating regulations. Operating extra-provincially with an intra-provincial SFC the carrier is not just risking tickets or penalties but, extra-provincial carriers carry insurance that intra-provincial carriers do not. Should the carrier have an accident while outside the jurisdiction the insurance company may deny that claim and open the carrier up to liability.
The High Stakes of Non-Compliance
Safety Fitness Certificate follows the virginity rule, you only get one shot. An Alberta carrier with a Provincial SFC that is stopped operating in another jurisdiction would be made Federal and the carrier would have to apply to return to intra-provincial. The regulation AR 314/2002 Commercial Vehicle Certificate and Insurance Regulation Section 6 4.2(1)(c) uses the wording operates or intends to operate. Getting caught operating extra-provincially proves the intention to operate. Operating with an Intra-Provincial SFC outside Alberta is not just a minor infraction—it’s a serious violation.
Carriers operating extra-provincially require ELDs, speed limiters, and are required to pay Provincial Sales Tax (PST) in jurisdictions like British Columbia and Saskatchewan. Non-compliance with these requirements may put the carrier on the radar of Alberta Transportation & Economic Corridors, Traffic Safety Services Division, Monitoring & Compliance Branch, Investigations & Enforcement Section and the carrier will be caught on the never ending NSC Audit wheel of fortune.
Final Thoughts: Stay Educated and Compliant
Remember, Alberta Transportation & Economic Corridors, Traffic Safety Services Division, Monitoring & Compliance Branch, Investigations & Enforcement Section role is enforcement, not education. Ignorance of the law is no excuse; carriers must take the initiative to educate themselves on the regulatory environment they operate in. Investing time in understanding these regulations can prevent significant headaches down the road. Stay informed, stay compliant, and keep your operations running smoothly.
BC Ministry of Transportation and Infrastructure
The federal vs provincial SFC is an Alberta system, not BC. A BC NSC Certificate is not different for carriers whether they operate only in province or over borders.
If you have a Provincial SFC, you will need to apply and obtain a Federal one in order to cross into BC. We do not issue permits changing a carrier's standing or operational category.
SASKATCHEWAN SGI PERMIT OFFICE
Saskatchewan does not have any permits that covers the provincial safety fitness, customers need to have their fitness safety changed to federal before entering SK
In my BLOG, “Why is trucking so F%&$ed up in Alberta? I can tell you why”, I explored the concern that Transportation and Economic Corridors have a vested interest in the economy and transportation safety becomes a secondary priority. Stop expecting Alberta Transportation to help you! Compliance and Oversight makes their budget from writing tickets, no matter how government tries to sell it.
Enforcement and education are two key components in a transportation regulatory framework, and they serve very different purposes. Enforcement uses penalties, fines, or legal actions to ensure compliance with regulations. It is a reactive approach that focuses on punishing non-compliance and deterring future violations. Education provides information, guidance, and resources to help industry understand and comply with regulations. It is a proactive approach that aims to promote awareness, understanding, and voluntary compliance.
Enforcement mechanisms are important for holding unsafe carriers and drivers accountable and maintaining whatever integrity is left of the commercial transportation industry. Where it all falls apart is when the regulatory bodies make the rules and don’t inform industry what those rules mean to them. Alberta Transportation and Economic Corridors has had the ELD regulations for three years and carriers facing departmental intervention are clueless to the risks.
In a roadside stop ELD penalties can add up fast. An example is; a driver’s ELD was in a malfunction state for the day the driver was stopped and inspected and the 14 previous days. If the driver did not follow the malfunction protocol the driver could be charged under 78(1) failure to ensure ELD operates in good working order and is calibrated and maintained. That penalty is recommended to be $1000.00 per offence for the driver. That would be $15,000.00. The carrier could be facing: 78(5) Failure to repair or replace ELD within required timeframe. $1000.00 per offence is $15,000.00 for the carrier. If the driver intentionally disconnecting the ELD to avoid accurate recording of the information that could be 86(3), Tamper with ELD $1000.00 per offence and the carrier could be facing 86(3) request require allow a person to tamper with ELD $2000.00 per offence. The carrier could be charged for every day because the carrier is supposed to be monitoring the driver, (87(1) and 78.3 (1)) using the carrier ELD dashboard and is aware of the malfunction. Imagine explaining to your boss how a driver earned the company a $32,000.00 penalty. Nobody gets a safety bonus this month!
This isn’t the good old days of trucking; drivers and carriers are monitored in real time and roadside officers are armed and have expanded powers including detention. Drivers need to take care during a roadside stop, speak respectfully and ask questions respectfully, even if the driver is correct and the officer wrong. In a roadside situation the person with the gun is always right and drivers need to remember that.
In summary, enforcement is about penalizing non-compliance, while education is about empowering compliance through awareness and understanding. Both enforcement and education are important tools in a regulatory framework, and a balanced approach that combines both can be effective in achieving regulatory goals. The problem is Alberta Transportation and Economic Corridors Alberta is not balanced; the focus is enforcement with no education for the carriers to be successful. Why would Alberta Transportation and Economic Corridors slit the throat of this cash cow when carriers can be kept in the dark and the cash keeps flowing?
When you mix transportation in with economic corridors there is always the risk that safety will not be a priority over the economy. I want to address some critical safety gaps that have been ignored by TEC (Transportation and Economic Corridors) for years. Albertan’s should be deeply troubled by the neglect of crucial safety policies within Compliance and Oversight.
The Compliance and Oversight department monitors the overall safety of trucking companies in Alberta. Compliance and Oversight conducts audits and investigations to ensure compliance with the NSC standards. However, there are glaring issues that demand immediate attention:
1. **Non-Compliance with Intervention and Discipline Policies:** There is a disturbing trend of Compliance and Oversight failing to adhere to its own policies. Companies with significant safety violations are not being labeled as unsatisfactory, allowing them to operate under conditional status without proper intervention. This negligence has been repeatedly highlighted in audits by the Auditor General, yet no corrective actions have been taken.
2. **Flawed Third-Party Auditor (TPA) Program:** The TPA program, responsible for conducting NSC Standard 15 Audits on behalf of the Alberta government, is fundamentally flawed:
- Auditors do not have encryption keys to be able to download complete RODS. This compromised data is used for hours of service reviews, impacting carrier safety and public road safety.
- Lack of support for auditors, hindering their ability to communicate with TEC for assistance.
- Inadequate training and monitoring of auditors, leading to unreliable audit information.
- Inefficiencies in data processing and communication, undermining the accuracy and effectiveness of audits.
If any carrier failed a audit or got a penalty as a result of a audit by a TPA in the last 2 years, I would 100% appeal it. The TPA audits are not accurate because TPA auditors do not have the “key” to unlock the box, that contains the accurate RODS. Would you pay your income tax if you found out the T4’s information has been wrong for years? Pretty simple argument.
To address these urgent safety concerns, the following actions are proposed:
1. Immediate review of all TPA audits and compliance records since June 2022, to ensure accuracy and reliability.
2. Establish a streamlined process for handling TPA audit by providing encryption keys, enhancing transparency and accountability.
3. Enforce intervention and discipline policies rigorously, ensuring that unsafe carriers are marked unsatisfactory and penalized accordingly, promoting road safety and public confidence.
Continuing to ignore these issues and allowing unsafe carriers continued operation is validating the perception that Alberta highways are more dangerous today. Unfortunately, these issues will be ignored until there is another incident involving a Alberta trucking company that Compliance and Oversight deemed safe.
What do planes, trains and semi trucks all have in common? Regulations to ensure the operators of those vehicles do not work fatigued. The Federal Hours of Service HOS (SOR/2005-313) regulates the amount of time a commercial driver is allowed to drive, be on duty and mandatory off duty time limits. The intent of regulating a driver’s time is an attempt to mitigate the number and gravity of truck crashes by tackling driver fatigue.
All carriers holding a Federal Safety Fitness Certificate (SFC) must follow the Federal Hours of Service (HOS) SOR/2005-313, which includes the mandatory use of Electronic Logging Devices (ELDs) for tracking driver hours (HOS 77). It is important to recognize that some provinces in Canada like Alberta and Manitoba have both federal and provincial SFCs, leading to potential variations in HOS regulations between federal and provincial rules. Example, a carrier with a provincial SFC has no cycle limitations and can be on duty a total of 15 hours a day. A carrier with a federal SFC is limited to 70 hrs in 7 days or 120 hours in 14 days in a cycle and on duty a total of 14 hours in a day. Moreover, some provinces like Alberta did not adopt the ELD mandate for carriers with Provincial SFCs. Regardless of the specific type of Safety Fitness Certificate held by a carrier, all drivers operating regulated commercial motor vehicles are obligated to comply with the relevant Hours of Service duty status limits. This underscores the importance of understanding and adhering to the appropriate regulations to ensure compliance.
The Federal Hours of Service (SOR/2005-313) section 4 outlines the responsibilities of motor carriers, drivers, shippers, consignees, safety officers, dispatchers, and others to help prevent driver fatigue.
They are responsible to ensure a drivers must not drive if:
ELDs record time by the second and track how much time is remaining in a drivers shift. The ELD alerts the driver 30 minutes before a duty status limit is reached, Technical Standard 4.6.4. Drivers and persons listed in Section 4 of the HOS must be trained in the rules of HOS. However, it is no longer imperative to understand the minutia of team split sleeper or deferral calculations because the ELD does and the ELD monitors and alerts the driver to available time.
On duty and driving limits: driving and on duty time is automatically recorded by the ELD. Team drivers must authenticate (log in) to the ELD, (Technical Standard 4.1.4 b). The ELD monitors and calculates time concurrently for team driving conditions such as; team split sleeper berth.
Operating zone is set by the motor carrier during the drivers account creation (Technical Standard 7.46). The ELD will track and alert the driver 30 minutes before a duty status is reached. North of 60 covers three territories: Nunavut, Yukon, and the Northwest Territories. There are no daily limits only work shift limits.
A driver is allowed to defer 2 hours of off duty time to the following day. This allows drivers to obtain two additional driving and on-duty hours in a 24-hour period (Day 1). Then, they can take the required two hours off immediately the next day (Day 2).
The ELD will track and alert the driver to the time requirements ensuring compliance to the regulation.
Certified ELDs are now required for commercial carriers as part of the law. Carriers must understand how ELDs work and how to review the data they generate. Previously, drivers used paper logbooks to track their time, with the burden of accurate recording falling on the driver. Carriers were responsible for monitoring these logs, but they provided historical information. With ELDs offering real-time certified data, it is now the motor carrier's duty to actively monitor drivers through the ELD's features and confirm the accuracy of their records of duty status (RODS). In case of a serious collision, the carrier can no longer shift blame to the driver, claiming ignorance of any violations of driving hours, as they are now expected to constantly monitor and verify compliance using the ELD data.
Ensuring that motor carriers have appropriate safety ratings is a crucial responsibility of regulatory authorities overseeing transportation. The presence of unsafe and unfit carriers on the road poses significant risk, not only to the drivers and personnel directly involved, but also to the general public. The consequences of accidents involving such carriers can be severe, leading to injuries, loss of lives, property damage, and environmental hazards.
There is a real and probable risk that federally regulated Alberta carriers have been upgraded to a Satisfactory or Excellent safety ratings using unreliable audit scores. The Province has been made aware of this, yet has taken no action to correct it, putting the Province at serious risk of liability.
The Alberta government is permitting private third-party auditors (TPAs) to use encrypted Record of Duty Status (RODS) for conducting NSC Standard 15 Audits. There are concerns about the validity of the audit results because encrypted data was used to conduct the audit. The specific concern is that encrypted RODS may lead to inaccurate and unreliable hours of service scores, which significantly contribute to the overall audit score, potentially rendering the entire audit ineffective.
Any federally regulated carriers in Alberta that have undergone an NSC Standard 15 audit by a TPA since January 1, 2023, should have their audit fees refunded, administrative penalties and conditions repealed, and their safety rating rescinded to preaudit status.
In 2021, Transport Canada updated the Federal Commercial Vehicle Drivers Hours of Service Regulations (SOR/2005-313) to include Electronic Logging Devices (ELDs), (Section 77), and also refers to the Technical Standard, developed by the CCMTA. All certified ELD devices must meet the Technical Standard.
The Technical Standard requires all ELD systems to generate standardized ELD output file (CSV and PDF) and transfer those record of duty status (RODS) to an authorized safety official upon request (System Design 1.4 d). The Technical Standard specifies the minimum data required to be included on the standard ELD output file (CSV and PDF) (System Design 1.4 e). For a TPA to audit RODS that fully meet the Technical Standard, the RODS must be sent via one of the transfer methods specified, and in the manner specified in Technical Standard 4.8.2 ELD Output File. Data must be transmitted via:
Transport Canada compiled a list of email addresses for inspectors authorized to have PKI encryption keys. PKI is an acronym for public key infrastructure, which is the technology behind digital certificates. A digital certificate fulfills a similar purpose to a driver’s license or a passport – it is a piece of identification that proves your identity and provides certain allowances.
When a government safety official receives the RODS from a trucking company, the RODS are unencrypted, via PKI, because government enforcement officials have the encryption key. TPAs do not, because they are not designated as inspectors. This is a critical gap in the auditing process when a trucking company transmits encrypted Record of Duty Status (RODS) to a government-certified TPA. The TPA cannot access all the required data for a comprehensive audit.
TPAs do not have encryption keys primarily to protect driver privacy during periods of personal conveyance. Driver privacy is paramount and there is a Technical Standard specific to that end (Technical Standard 4.7.3 Privacy Preserving Provision for use during personal uses of a CMV).
To compound the issue, TPAs are not required to retain the RODS reviewed in an audit, therefore previous audits cannot be reviewed to ensure correct RODS were used.
Both of these factors raise significant concerns about the transparency and accountability of Third-Party Auditors (TPAs) in the auditing process, particularly regarding the handling and verification of unencrypted Record of Duty Status (RODS) data. If there is no mechanism to confirm whether TPAs are using unencrypted data and no requirement for them to submit evidence for retention, it creates a potential vulnerability in the accuracy and reliability of audits.
Private industry is aware of the problem to some degree. Private Motor Truck Council of Canada (PMTC) president Mike Millian said in a 2022 press release:
“We are also waiting for a PKI vendor and system to be announced by Transport Canada that allows for ELD data to be transferred securely from the device to enforcement personnel, as well as enforcement protocols, training, and how the regulation will be enforced uniformly between jurisdictions.”
In June 2022, the CTA (Canadian Transportation Association) released information via email regarding the PKI system:
“Encryption of Record of Duty Status Email Files
The process for establishing the encryption of records of duty status (known as PKI) for email transfer to Roadside officials is the responsibility of Transport Canada. The process for implementing the Transport Canada work is the responsibility of each provincial and territorial jurisdiction, which includes submitting email addresses of enforcement officials who will be engaged in hours-of-service enforcement. The requirements and format for ELDs to produce the encrypted record of duty status are contained in the ELD technical standard, which is the result of a collaborative effort between Transport Canada, representatives from all provincial and territorial governments and ELD vendors. Devices certified through the Transport Canada and Standards Council of Canada process will meet the required format for record of duty status.”
As of January 1, 2023, NSC Audits conducted by Third Party Auditors in Alberta can not be considered accurate to a threshold that can be used to assess carrier safety risk.
There is no way to confirm the RODS used by a third party auditor were unencrypted because unlike the government auditors, TPAs are not required to submit the evidence reviewed for retention in the TSIS system. If you compare this to evidence used in criminal matters, if evidence is considered suspect or deficient, it cannot be used to convict. If the RODS used in a Third Party Auditor audit are suspect or deficient, the information cannot be used to assess an administrative penalty, condition or SFC rating.
Recommendations
There are two possible resolutions to the issues at hand.
Recommendation 1
A simple three-part solution exists to mitigate and correct the issues at hand.
Recommendation 2
Designate government-certified TPAs as “inspectors” which would enable them to access the PKI encryption key required to access full and correct ELD RODS datasets. The Federal Commercial Vehicle Drivers Hours of Service Regulations (SOR/2005-313) defines an
inspector as:
(a) a person designated under subsection 3(2); or
(b) a peace officer within the meaning of section 2 of the Criminal Code.
Section 3(2) of the same regulations notes that:
(2) A director may designate inspectors for the purposes of these Regulations.
References
