Events

I recently sent out a memo from Mike Kaemmerer, which quickly outlined the new ruling, however as you can imagine triggered a number of questions.  I wanted to follow up with some additional info along with a basic example of how the new ruling will be applied on a per week basis.  I have scheduled a seminar for our members at SLADA on May 26th, from 12-1:30 to discuss this topic in great detail, of which Mike Kaemmerer and I will be available to answer more specific questions you may have.  Please RSVP by calling Katie or Leza at the SLADA office.
 
Here is an example…along with more details:
 
1. S/A makes $20.00 per hour…works 60 hours in a particular week = $1,200
2. Also in that week draws a commission off of sales = $600
a. Totaling - $1,800 for the week
   You would divide that by 60 hours = $30, Giving you the Net Effective Rate.
   You would then divide that by 2 = $15, Giving you the “half time” dollar amount needed.
   Then multiply $15 (half time) by 20 hours (the employee went over 40 for that week) = $300, This number represents the amount of pay over and above what the employee currently makes with their draw plus commission!
 
At the moment, the courts are pushing to keep Service Advisors under the “Mechanical/Parts/Sales Team” exemption (Fair Labor Standards Act, Section 13(b)(10)(A)), which is how the statue had been implemented for the last 23 years.  There are three (3) cases ruling to that affect, however there are no cases in Missouri’s circuit of Federal courts at this time.
 
What do I do next?
 
1. Immediately Comply:

2. Do nothing:
a. I want to wait and see how courts handle each case as they are litigated.
b. May potentially have a battle between the DOL and the Federal Courts over the recent ruling.

3. Additional Exemption:
a. In order to avoid the above mentioned ruling…an individual Service Advisor would have to have 50% or more of their individual income coming from commissions.
 
See everyone at the seminar,
 
Chris Adelmann
Executive Vice President
St. Louis Auto Dealer Association
St. Louis Auto Show