GNYADA July 2014 Newsletter

5 GMYields to Dealers onWarranty Reviews

GM, which had been demanding that dealers produce two months of R.O.s so it could review the warranty reim- bursement rate, has now reversed itself and withdrawn those demands, in the face of objections raised by GNYADA and dealers. In a letter to dealers this month, GM said that, “[G]iven the current environment and the feedback we have received from dealers, GM is suspending its review of parts handling allowances… Accordingly, [dealers] need not pro- vide at this time the job cards requested….” GNYADA had advised dealers that manufacturers have no right under New York’s Motor Vehicle Dealer The National Labor Relations Board has ordered an Arizona car dealership to reinstate a salesman who was fired after he launched into an offensive, profanity-laced tirade directed at the owner of the dealership. The salesman questioned the owner about vehicle costs, commissions, and minimum wage. The owner told him to follow policies and procedures, and to stop complaining about pay. The owner told the salesman that he did 6

Franchise Law to “adjust” an approved warranty reimbursement rate after it had been set. GNYADA also reached out to GM to urge them to reconsider their efforts to do so. One dealer, who complied with the request from GM, received notice that his warranty rate was reduced. GM has now reversed course even in that case. Though the manufacturer claimed that its review was consistent with the state’s Franchised Motor Vehicle Dealer Act (FMVDA), GNYADA believes this “review” and any unilat- eral reduction of warranty rates is not sanctioned under the state law. The not have to work there. The salesman became upset and told the owner, in an expletive-lace tirade, that he was dishonest and stupid, nobody liked him, and everyone talked about him behind his back. The salesmen said that if he were fired, the owner would regret it. The owner fired him. The NLRB found that the salesman’s questions about compensation consti- tuted activity protected by the NLRA. This protection applies to union and

FMVDA clearly authorizes only the dealer to submit a request to change its parts markup or labor rate. When GM began to send its notices to dealers, GNAYDA recommended dealers to protest, in writing, immedi- ately. GNYADA worked with its franchise law counsel Richard Sox, Esq., to frame the successful objec- tions to GM’s process. This item is intended to provide infor- mation, and should not be construed to constitute legal advice. For further information concerning this issue, please contact Stuart Rosenthal or Susan Bieber at 718.746.5900.

NLRB Reinstates Cursing Salesman

non-union employees. The NLRB found that the termination was unlaw- ful because the salesman’s behavior was protected. The lesson here is to proceed with caution when disciplining employees for inappropriate or insubordinate behavior if the behavior occurs in the context of a discussion concerning wages, hours and other terms and conditions of employment.

7 In a significant victory for dealers, the state has eliminated the annual requirement to provide each employ- ee a notice indicating their overtime rate of pay along with their regular payday/pay rate. Since the law went into effect, GNYADA has argued it was overly burdensome, and the annual notice was unnecessary. We actively supported its repeal. GNYADA’s Employee Relations Plan (ERP) prepared a comprehen- sive step-by-step instruction guide to completing these wage notices. The Guide to New York State Employee Pay Rate and Payday Forms along with sample industry-specific forms are available on GNYADA’s website at: http://www.gnyada.com/dealers/ payforms/overview Albany Votes to Eliminate Annual Payday Notice The requirement to provide this notice remains in place upon hiring and changes in pay for employees and failure to comply will result in stiffer penalties. Payday/Pay Rate Notices must be acknowledged by the employee and retained for 6 years.

Greater New York Automobile Dealers Association • www.gnyada.com

The Newsletter • July 2014

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