Today's dealerships face numerous challenges in their pursuit to stay afloat. They are experiencing increased competition, fast-evolving consumers, and tighter margins on car sales than before. Car dealerships must also add new employment regulations and laws to their list of the wave that already impacts how they manage their workforce. The new employment laws and regulations not only exposes car dealerships to lawsuits from workers but also increase the cost of legal compliance and labor.
With so many things to worry about, it can be hard for dealerships to balance their responsibilities with providing great customer service and making decent profits. This is especially true for small and midsize dealerships. Below are some of the employment and legal document management challenges that dealerships around the world face.
Changes in the FLSA Exempt Classifications Interpretation
The FLSA excludes some workers of car dealerships from its overtime requirements. For example, people involved in servicing and selling automobiles are exempted from the list. Auto dealers in the United States have always relied on the guidelines from the labor department, which exclude service advisors from overtime requirements. However, the federal agency reserved its position in 2011 and ruled in favor of overtime pay for the service advisors. The decision to reverse the regulations conflicts with decisions made by courts in other states. That means dealerships must comply with the new guidelines or risk misclassification lawsuits from their former service advisors.
Fair Pay Act
The fair pay act forbids car dealerships from gender-based discrimination when it comes to compensation. However, the bill has been amended twice in two years, creating more litigation for auto dealers. In 2016, the fair pay act was expanded to include all employees irrespective of their position or title. That means car dealerships must involve all their workers when conducting a pay comparison. Later on, the federal agency amended the law to include record keeping requirements. In 2017, the agency expanded the legislation to compel car dealerships to pay disparities based on ethnicity and race. Car dealerships with less ethnic diversity and gender positions are likely to see more litigations and agency action than before.
Workplace Harassment Rules
New workplace harassment regulations in the US went into effect in 2016. These regulations have raised complaint procedure requirements and workplace harassment regulations applicable to workers of car dealerships. Previously, the law required that all car dealerships with more than 50 employees train their supervisors in various topics related to workplace harassment. The new requirements demand that the training to cover supervisor obligations, victim's legal remedies, abusive workplaces, and remedy and strategies to prevent workplace harassment. As such, car dealerships have to comply with strict workplace harassment training regulations while training their supervisors.
Abiding with these and other laws can make a car dealership not only compliant but also prosperous. In many instances, car dealerships need to make slight changes to their existing procedures and policies to remain compliant with employment law requirements.