Is it Time to Recall Some of Your Dealership HR Policies?

By Team Hireology,
November 1, 2017

Note: The content in this post was written by Christopher Hoffman of Fisher & Phillips and originally appeared in our Human Capital Management Playbook for Elevate 2017

Factory recalls have become a fact of life for those who sell and drive vehicles. The scenarios have a common theme: a vehicle part does not operate as designed or is determined to present a possible risk of failure. Once there is enough evidence to suggest a problem or potential problem exists, the recall process begins. Better to be safe than sorry. While the risks and potential harms pale in comparison to vehicle recalls, some employer policies should be similarly recalled and replaced. Some policies no longer work as designed because of subsequent changes to certain laws. Other policies and practices thought to be sufficient when implemented have not been as effective in application as they could be. Still other policies would benefit from a few overdue improvements that you didn’t consider at the time of drafting.

A few examples follow of policies and practices you may want to consider recalling.

Employment Applications and New Hire Packets

If you have not revised your employment applications recently, it may be time for a recall. In recent years, several state and local governments have passed laws restricting the types of questions you can ask applicants before making a conditional job offer. Because of “ban the box” laws, you may be restricted from asking questions regarding an applicant’s criminal history.

These laws are designed to secure jobs for more people by either delaying the point in time you can ask an applicant about their criminal past, or prohibiting you from asking altogether. Some jurisdictions that recently adopted such a law include the states of New Jersey and Illinois, along with the cities of Los Angeles and Portland. A total of 26 states and over 150 cities and counties currently have such a law, and those numbers continue to grow.

Moreover, some jurisdictions prohibit employers from asking how much money an applicant made at prior jobs; New York City recently joined other municipalities in passing such a law. If you operate in one of these jurisdictions and your application still includes questions about a criminal record or salary history, a recall is necessary.

FCRA Disclosures and Adverse Action Letters

The recalls don’t stop with the application. Did you know you must obtain an applicant’s written authorization before having a third party run a search on the applicant’s criminal or motor vehicle background? To be lawful under the Fair Credit Reporting Act (FCRA), that authorization must be on a standalone document that contains a “clear and conspicuous disclosure” and cannot include additional requirements not permitted under the law. Additionally, dealers must send pre-adverse and adverse action letters where the results of the background check may be used as grounds to refuse to hire an applicant or terminate an employee. Unfortunately, many dealers are unaware of this requirement, leading plaintiffs’ lawyers to run to the courthouse to file class action lawsuits based on nothing more than non-compliant forms. Therefore, it’s time to review your forms to make sure you don’t fall in this trap, even if the company performing your background checks has provided them for use.

Reasonable Accommodation Policy

Almost without exception, an employer’s “equal employment opportunity” pledge includes disability as a protected status. As the law has developed under the Americans with Disabilities Act (ADA), the primary issue in cases alleging disability discrimination is no longer whether the employee or applicant has a “disability” under the definition of the statute. Rather, the most commonly contested issue in these cases is whether the employer provided, or even considered providing, a reasonable accommodation for an employee’s physical or mental impairment. Having a written accommodation policy not only sets forth the obligations and roles of both you and your employees in these situations, but also signals to the world that you understand your obligations under the law. Of course, you still must fulfill those obligations, but having an up-to-date policy is a necessary first step.

Leave Policy

Speaking of the ADA and reasonable accommodations, unpaid leave may be an option to consider as a reasonable accommodation. In fact, the federal Equal Employment Opportunity Commission (EEOC) has taken the position that 12 months of unpaid leave may not be unreasonable on its face.

Many leave policies, however, do not contemplate the possibility of granting extended leave beyond the Family and Medical Leave Act (FMLA) period as a reasonable accommodation. Some policies even have predetermined limits on the amount of leave the employer will provide beyond any FMLA obligations. Under the ADA, however, leave requests must be considered on a case-by-case basis, and you might run afoul of the statute by instituting a one-size-fits-all policy. If your leave policy does not contemplate this requirement, it may be time to recall it.

Employee Reimbursement Policies

Many dealerships have policies requiring employees to reimburse them for vehicle damage and lost or broken tools or equipment. These policies often authorize the dealership to recover such amounts through payroll deductions. Policies of this type are subject to state and federal law that may limit or prohibit certain deductions. If you have a reimbursement policy, we suggest bringing it in for a tune-up to ensure it complies with law.

Post-Accident Drug Testing Policy

Common in most workplaces is the requirement that employees automatically submit to a post-accident drug test, even when there is no indication of drug or alcohol use. The Occupational Safety and Health Administration (OSHA) implemented a new rule in December 2016 that prohibits such testing unless there is cause to believe the employee was under the influence of drugs or alcohol at the time of the accident. If you have an automatic post-accident testing policy, an immediate recall may be in order.

No-Harassment Policy

Although most dealerships now have formal no-harassment policies, a couple of common recall issues may still exist. For example, many policies require employees to report harassment to their supervisor. While it typically makes sense to have an established chain-of-command system, the reality is that many frontline supervisors and managers are not qualified to address harassment concerns, or are themselves the subject of the complaint. An approach that could benefit all parties is to have employees bypass their immediate supervisor altogether when reporting such problems, or at least provide an alternative reporting plan for employees who would rather not approach the supervisor or are not satisfied with the supervisor’s response.

The other common recall issue relates to the additional protected categories of sexual orientation and gender identity. In states where these categories are not specifically protected by state law, many dealers have not included them in their no-harassment policy. Recently, several courts ruled that harassment based on these characteristics is a form of sex harassment, so revisions to your policy might be warranted.

No-Retaliation Policy

Many no-harassment policies include a sentence or two assuring employees that the employer will not retaliate against them for reporting harassment. If this describes your policy, it may be time to add a separate no-retaliation policy that more clearly and thoroughly explains your position on the matter. In the last few years, retaliation has become the most common charge filed with the EEOC, so you will want to have all the protection you can muster.

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