Nearly a year after California’s New Motor Vehicle Board (NMVB) considered the petition from the California New Car Dealers Association (CNCDA), which resulted in an investigation by the California DMV, Volvo has agreed to terminate it’s so-called “subscription” program in the golden state. The Volvo program—Care by Volvo (CbV)—was launched by Volvo in the United States in November, 2017 and marketed to consumers as an “all inclusive” two-year subscription service for Volvo vehicles that included maintenance, auto insurance, road hazard and tire and wheel protection for a flat “monthly fee.” The program was offered directly to consumers through Volvo’s website, promoting in particular the newly released model XC40, which was also being allocated to California franchise dealership from port stock only if they agreed to sign an amendment to their dealer agreement that made the dealers limited agents of Volvo who would consummate the CbV subscriptions.
The COVID-19 pandemic and the related economic shutdown and quarantine orders continue to weigh heavily on businesses across California, and auto dealerships are certainly no exception. During such trying times, it is only natural for dealers to begin thinking about creative ways to operate as efficiently as possible. One idea that dealers have considered is converting relationships with salespeople from one of employment to one more akin to an independent-contractor relationship, where commissions are paid to salespeople. Dealers considering such an idea must be mindful, however, of their continuing legal duties under such circumstances.
Local regulators are stepping up enforcement of protocols, dealers should continue to evaluate their protocols or adopt them for the first time.
Published on Thu, 07/23/2020 - 4:49pm
As we noted in our July 13, 2020 alert, Governor Newsom has taken steps to reverse some of the reopening rules across the state, focusing on indoor activities. Now local governments, in particular those in Southern California, are modifying local reopening guidance in response to the increase in COVID-19 cases across the state. We have also received word of stepped-up enforcement by local regulators. Due to these changes and increased enforcement activity, every dealer should continue to evaluate their written protocols or adopt them for the first time, if not already completed.
Tips for avoiding litigation when it's possible and protecting you when it isn't
Published on Wed, 07/22/2020 - 6:56pm
Scali Rasmussen has discovered trends in recent cases filed against dealers. This article—written by the firm's partners for the CNCDA Bulletin—highlights these trends to help dealers identify, review, revise and/or adopt compliance policies and procedures to protect against costly litigation or defend one of these suits.
In two class action cases that have been consolidated in federal court, pilots and flight attendants are alleging, among other things, that their airline employers failed to provide them with compliant wage statements under California law. In both Ward v. United Airlines, Inc. and Omar v. Delta Airlines, Inc., the Ninth Circuit asked the California Supreme Court to decide a couple questions of state law that were unsettled. One question that was common to both cases was whether employers are required to provide wage statements (pursuant to California law) to employees who perform work both in California and other locations.
Last year, we discussed the California Supreme Court’s ruling in the case of One Toyota of Oakland v. Kho (“OTO”), which seemingly went against federal law favoring arbitration and the use of mandatory arbitration agreements in employment. In OTO, a dealership service technician brought a claim for unpaid wages in front of the Labor Commissioner. The dealership attempted to move the case to arbitration under the technician’s arbitration agreement, but the trial court found that the arbitration agreement was unenforceable as procedurally unconscionable.
Effective July 1, 2020, several California cities will implement minimum wage increases. Generally, employees who perform at least two hours of work in a city are covered by the minimum wage provisions of that city, which would be at or above the California minimum wage rate.
As employers settle into their protocols for employee health screenings and other preventative measures to lower the risk of Coronavirus spread in the workplace, questions still remain as to what they can ask employees about their health. Government agencies continue to provide further clarification and guidance. Two agencies recently provided updates...