Understanding LTL Reclassification and Freight Class
LTL reclassification happens when a carrier adjusts the freight class of a shipment due to incorrect classification. Freight class, defined by the National Motor Freight Classification (NMFC) system, determines shipping rates based on density, handling, stowability, and liability. The pounds per cubic foot (PCF) is a key factor in density-based classifications.
If a shipper miscalculates weight, dimensions, or class, the carrier may reclassify the shipment and charge additional fees. This can increase shipping costs and cause billing disputes. ViewPoint TMS helps shippers avoid this issue by auto-determining PCF when weight and dimensions are entered. It then retrieves the proper freight class automatically. This accuracy on the front end saves shippers money, and it prevents having to waste time mitigating billing discrepancies on the back end. There have been many examples at shippers where the team quoting the freight on the front end were not aware that the accounting department was paying reclass fees on the backend, and this is why it makes sense to invest in working with a 3PL like TLI.
To further reduce errors, TLI utilizes ClassIt by NMFTA, the governing body that maintains NMFC codes. This ClassIt tool ensures shippers use the correct freight classification from the start, during BOL generation, minimizing costly reclassification fees.
What Is an LTL Reclassification Fee?
A reclassification fee is an extra charge applied when a carrier determines the freight class was incorrect. This happens if the density, stowability, or handling requirements don’t match the class originally listed on the bill of lading (BOL).
These fees vary but can be substantial, increasing shipping costs by hundreds or even thousands of dollars. In addition to the base charge, carriers may apply administrative fees for correcting the classification.
Reclassification also causes billing delays. Carriers may hold shipments for review, delaying transit times and creating unnecessary supply chain disruptions. The best decision a strategic shipper could make is delegating this classification issue to TLI and their freight audit as a service team.
Why Is the Correct NMFC Code Important?
As mentioned previously, each product has a specific NMFC code that determines its freight class. If a shipper misapplies an NMFC code, the carrier may reclassify the freight and adjust the shipping charges accordingly. Likewise, if a shipper guesses on the dimension entry or the weight the PCF will not be accurate.
Using the wrong code can lead to:
- Higher shipping rates due to incorrect density assumptions.
- Billing disputes between the shipper and the carrier.
- Delays and additional administrative fees.
The most common complaint from shippers, is that they billed their client for the freight charges, and then get the additional fee on the backend, and have to either send a correction the customer or eat the additional fees. Again, it is imperative to just get it correct at the time of Bill of Lading creation, so strategically delegate this supply chain function to TLI. With TLI’s managed logistics services, shippers avoid these issues. We verify NMFC codes upfront during the ViewPoint TMS deployment, ensuring that your shipments are properly classified before they are tendered to the carrier.
How to Avoid LTL Reclassification Charges
The best way to avoid reclassification fees is to use accurate weight, dimensions, and NMFC codes when booking shipments. Here’s how:
- Use a Transportation Management System with automated classification – ViewPoint TMS auto-calculates density and selects the correct freight class, eliminating manual errors.
- Consult the NMFTA NMFC directory – The NMFTA provides up-to-date classification codes for every product. Using outdated codes increases the risk of reclassification.
- Work with a 3PL like TLI – Our team validates freight classes before booking, preventing costly adjustments.
By following these steps, shippers reduce unexpected charges and improve shipping accuracy.
Other Common Billing Disputes in LTL Shipping
LTL shipping invoices often include unexpected fees beyond reclassification. These common disputes can inflate freight costs if not handled properly:
1. Reweigh Fees
If the weight on the BOL is incorrect, the carrier will reweigh the shipment and charge a correction fee. Always use certified scales and verify weights before booking.
2. Unquoted Accessorial Charges
Some accessorial fees are not quoted properly upfront, leading to billing surprises. This is why it is important to work with a trusted 3PL rather than a fly-by-night freight broker. The most common hidden charges include:
- Limited Access Fees – Applied when delivering to schools, military bases, or remote locations.
- Liftgate Service – Needed when a dock is unavailable for loading/unloading. If not pre-quoted, carriers will charge premium rates for these services.
3. Reconsignment Fees
If a shipment is routed to the wrong address, carriers apply a reconsignment fee to redirect it. This charge can be hundreds of dollars, especially if the new location is far away from the original destination.
Why NMFC Codes Keep Changing
NMFTA regularly updates NMFC codes every quarter, impacting freight classification rules. If a product’s classification changes and shippers don’t adjust, they risk misclassification and unexpected charges.
To stay compliant:
- Regularly check for NMFC updates through the NMFTA.
- Use a Transportation Management System that stays current with classification changes.
- Work with a 3PL like TLI to ensure correct classification.
TLI provides LTL brokerage services and managed logistics solutions that eliminate reclassification fees. Our freight invoice audit catches billing errors before they impact your bottom line. We handle claims, disputes, and billing corrections so shippers can focus on their business, not freight problems.
Want to avoid reclassification surprises? Let TLI handle it. Contact us today for a customized shipping strategy.