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CATA Bulletin
March 28, 2005


Take steps to reduce liability when conducting employment interviews

November 22, 2010

Practically everyone has been through the interview process, either as the applicant or as the person conducting the interview. For the interviewer, it is an opportunity to observe the applicant's appearance and behavior, and to collect additional information on background, training and experience.
For the applicant, it might be the first exposure to the dealership, which means the employer also has an opportunity to make a good first impression. 
The following techniques can make the most of the interview process for both parties.
• Designate appropriate department managers to conduct job interviews. Ideally, the interviewers should be trained in equal employment opportunity law. Interviewers should limit their questions to information about the applicant's ability to perform the work, such as education, work history, skills and abilities.
• Try to standardize all interviews. That helps an interviewer to stay on track and remain objective. Have each interviewer prepare a list of at least 10 job-related questions and have the interviewer ask all applicants the same questions. Certain questions should be avoided. 
Do not ask questions that directly or indirectly bear on sex, marital status, parenthood, age, race, national origin, religion or handicap. If the applicant volunteers such information, the interviewer should state that the information is not relevant, and refuse to note it.
• One word of caution about note-taking: Make notes on all job-related information, but do not make notes on any factor that may be considered discriminatory. Avoid describing the applicant's physical attributes or other comments related to the applicant's sex or age-"bald," "youthful-looking" and the like. Such notes can be used against an employer to show there was a discriminatory basis for any hiring decision.
The Americans with Disabilities Act prohibits employers from asking questions related to disabilities prior to making a job offer. However, it is permissible to ask whether an applicant can perform all of the essential functions of a position, with or without reasonable accommodations.
• Tell would-be interviewers to avoid making statements that oversell job security. Examples include "You've got a job with this dealership as long as you do a good job," or "This is a permanent position."
For the same reason, when discussing compensation, avoid the term "annual salary." Instead, state the pay in terms of weekly, biweekly or monthly figures, and then state that, on an annual basis, the figures would equal $XX,XXX. (Some courts have held that discussing pay in terms of annual salary equates to a contract of employment for at least a year.)
Once a successful applicant comes to terms on employment, notify all other applicants who were not offered the position. The manner in which all applicants are treated reflects on a dealership's image in the community.
The preceding information was excerpted from an NADA publication, "People Policies: A Dealer Guide to Employment Law." Dealers are urged to contact their own employment law advisors for specific advice about federal and state law requirements on personnel matters.

Carfax pushing hard for accident data bill

November 22, 2010

Lobbyists for Carfax continue to solicit support for the Illinois Senate bill that would make available any accident reports related to a vehicle offered for sale in the state. Ten of the state's 59 senators have signed on as sponsors of SB 1839. The General Assembly is in the midst of a two-week break, but the CATA is contacting senators, to defeat the bill when senators reconvene. If SB 1839 becomes law, companies like Carfax, which markets vehicle history reports, would add accident information to their electronic reports. That would harm the values of used vehicles, including customer trade-ins. Information contained in Carfax reports is dubious. When Carfax Vice President Gerry Bayer visited the CATA board in December 2003, he heard an earful about inaccuracies in Carfax reports. Bayer assured the CATA directors that Carfax would not flag a vehicle if any information is found to be wrong. But, he conceded, an erroneous reading would not be removed from the report. Accident-scene damage reports merely establish whether the harm is above or below a $500 threshold. The reports do not indicate whether any damage should affect a vehicle's resale value. Moreover, police officers are not damage experts; their interest is in assigning fault for an accident. In less severe "fender benders," the drivers themselves often may complete the accident report, days later and with self-serving estimates of damage. And even though inaccurate accident reports are common, a dealer who sells a used vehicle without disclosing prior damage-known or unknown-can face demands of a refund by purchaser or a lawsuit. It can take months for an accident report to weave its way to vehicle history marketers. Dealers who retail a trade-in during that interim could be subject to a suit. Still, prosecuting attorneys in other states already point to Carfax reports as containing definitive information. The CATA and the Illinois Automobile Dealers Association in Springfield are working together to defeat the bill. Dealers should voice concerns to their senate contacts.

Bill would show insurance limits on cards

November 22, 2010

The insurance card that must be carried with every vehicle, to show proof of insurance, would indicate the liability coverage limits applicable to that vehicle, under a bill currently before the Illinois House. Representatives are debating House Bill 1335 to amend the Illinois Vehicle Code to include a declaration of coverage limits. The cards currently do not identify  insurance limits, and the state's powerful insurance lobby has been reluctant to include the information, supposing that persons in an accident who have higher insurance limits might be pursued more vigorously by lawyers than those with lesser limits The bill would help dealers. A law enacted in 2003 shifts insurance responsibility on loaner vehicles to the driver. The dealer's insurer is the secondary insurer on loaners and remains primary on test drives. However, if a customer's insurance policy does not have a 100/300/50 liability minimum ($100,000 for bodily injury or death of any person; $300,000 for bodily injury of death of any two or more persons in one accident; and $50,000 for property damage), the dealer's insurance reverts to primary on the loaner. When they issue a loaner, dealerships currently are often resigned to verbal declarations from customers that their insurance meets the liability minimums. In fact, many people cannot correctly recite their insurance coverage limits. The bill has passed one reading in the House and now is before the Rules Committee. Bills with three favorable readings move to the General Assembly's second chamber for similar action.

NADA chairman supports financing transparency, but opposes rate caps

November 22, 2010

The matter of dealer-arranged financing is "a hot issue," said Jack Kain, and one about which he is prepared to travel far and wide to speak. Kain's travels took him to San Diego March 18, to a convention of Illinois and Missouri dealers. Kain, the 2005 chairman of the NADA, reviewed the association's developing national campaign to educate consumers and the government on auto financing. A proposal in California would set a $150 limit on dealer profit for arranging loans, and several states recently enacted rate caps. But Kain said the industry is not complacent, and he pointed to the 2.5 percent to 3 percent caps that already have been adopted by the major finance companies. "Transparency in the process is there. More regulations are unnecessary," Kain said. "Most retail car buyers can't get the same rates that dealers can get," he said. "And economic evidence shows dealers do not charge more to customers than the banks would." "The greatest challenge," said Kain, "is in the court of public opinion. But most customers are happy with their dealers," according to a survey commissioned by Automotive Retailing Today. The NADA campaign promotes four messages: • Dealerships offer the convenience of one-stop shopping; • Dealerships have access to many credit sources; • Dealerships offer competitive rates and have exclusive access to manufacturer incentives and discounts; and • Customers unhappy with the finance terms offered through a dealership can refinance elsewhere without penalty. "Every customer," said Kain, "should be treated in an open and honest manner and be well informed about all aspects of the transaction."

Americans with Disabilities Act

November 22, 2010

Some not-so-obvious conditions, like mental disabilities, also covered

Since the Americans with Disabilities Act took effect in 1992, individuals with various handicaps are protected. Businesses are required to make reasonable accommodations for their customers and employees with disabilities. Dealers have a record of compliance when the disabilities are obvious. But sometimes they aren't. A guidance memorandum issued by the Equal Employment Opportunity Commission states "the ability to interact with others" is considered to be a "major life activity." Therefore, anyone who exhibits "consistently high levels of hostility, social withdrawal, or failure to communicate when necessary" can be considered to be disabled. A major concern when the ADA was introduced was its failure to define what constituted a "disability." That was left to the EEOC and the courts. Over the years, the EEOC added various forms of mental illness to the list of covered disabilities. The basics are not new: Don't ask questions about mental health in interviews or on job applications. In any pre-employment testing, all acceptable candidates for a position must be subject to the same tests. It is the "reasonable accommodations" that may present problems for dealers and create concerns for their employees. Some concerns arise from the fear of the unknown and a misunderstanding of the nature of mental illness. As a result, there often is uncertainty about whether the psychiatrically disabled person presents a threat to the safety of co-workers-especially if medication is involved. The EEOC also suggests how to accommodate employees who may be mentally disabled: 1. Rewrite the employee's job description to include only the essential functions. An employee who is unable to perform a job's essential functions, even with a reasonable accommodation, can be terminated. 2. Provide an opportunity for flexible hours, part-time work, job sharing, or working at home, if possible. 3. Allow employees to set their own pace. Supervisors, for instance, might break large jobs into smaller components and assign the components one at a time. 4. Try to minimize external interruptions like personal phone calls. Provide an accommodation by allowing more frequent breaks. 5. Improve the workplace ambience with things like "white noise" filters, improved lighting, and enclosed workspaces. Accommodations for physical disabilities have pretty well assimilated since 1992. There are some things, however, that dealers should keep in mind to alleviate resentment felt by non-disabled employees. Remember these observations: • Not all disabilities are easily visible. Some employees, therefore, might think others are being coddled. Don't explain too much. Instead, offer something like "We're complying with the law." • Keep all personnel files confidential. Any medical information should be kept on separate forms in a separate file. • Strict dress codes may be considered a violation of the ADA for mentally disabled people, the EEOC has warned. Indeed, it may be easier to accommodate mentally disabled employees than physically disabled staffers. Also, know that employers are not required to lower their performance standards on the essential functions of a job-another reason to have good job descriptions for all dealership positions. For a copy of the current EEOC Guidelines, call its publication distribution group at 800-526-7234.


Chrysler Sebring is top-selling convertible in record sales year

November 22, 2010

Convertible registrations in the U.S. reached record levels in 2004, with a 6.3 percent increase over last year, and the Chrysler Sebring repeated as the top-selling convertible. The 315,306 total convertible registrations surpassed the 2001 record of 309,741. "The success of the convertible in 2004 is due to a strong overall automotive market and several new convertible introductions," said Lonnie Miller of Polk. "Convertibles are considered a discretionary purchase, and as such a strong convertible market reflects an optimistic economic mood witnessed by the economic turnaround experienced in 2004." New convertible introductions in 2004 included PT Cruiser, Chevy SSR, BMW 645, Mini Cooper, Audi S4, Lotus Elise and Chrysler Crossfire. Convertibles have held steady at 1.8 percent of the total market over the past three years. At 1.9 percent in 2004, convertibles are inching closer to 2 percent of the overall light vehicle market. The increase in the convertible market of 6.3 percent was significantly above the increase in light vehicle market registrations of 1.4 percent. "Convertibles have become an integral part of many manufacturers' strategy," said Miller. "They jazz up the brand's overall vehicle portfolio, attract a desirable demographic and serve as showroom traffic builders. The introduction of hardtop convertibles is making them more appealing and practical for a broader range of customers. Planned new convertible introductions and freshened models will keep this category lively." Los Angeles and New York are the largest retail markets in the country for convertibles with more than double the amount of convertibles as the third largest market: Miami/ Ft. Lauderdale. San Francisco came in fourth, followed by Chicago in fifth place.

April 6 seminar to review ad regs

November 22, 2010

Representatives of the Illinois attorney general's office will review the state's motor vehicle advertising regulations at an April 6 seminar at the CATA in Oakbrook Terrace. The presentation is 12-2 p.m. that day. The seminar will focus on common regulation infractions and offer time for questions. Copies of the current regulations will be provided. To register, call the Illinois Automobile Dealers Association at 800-252-8944. The IADA charges a $25 registration fee for each attendee..

Chi-Town Sta-Bil Kruze to roll June 4

November 22, 2010

Owners of up to 2,000 classic cars are expected to take part in a rare opportunity to cruise along Chicago's historic Lake Shore Drive, during the inaugural Chi-Town STA-BIL Kruze on June 4. The participating cars will create a loop from Montrose Street to 31st Street as they showcase their nostalgia while driving with local traffic. The cars then will gather at Soldier Field for a Classic Car Show. The Kruze is open to all road-approved vehicles, but there is a $20 registration fee to participate in the Soldier Field segment, which is limited to the first 750 pre-1980 cars. The Kruze is 8-10 a.m. The Car Show is 11 a.m.-3 p.m. For more details and to register, see Gold Eagle, a producer and marketer of brands like STA-BIL fuel stabilizer, is the event's presenting sponsor. The company was founded in Chicago more than 70 years ago. The event's official media partner is WJMK-FM, 104.3 Radio. Station General Manager Dave Robbins said he plans "to make the Kruze the Chicago car enthusiast's high point of the year." The not-for-profit Chi-Town Kruze Organization consists of a number of local business owners with a passion for automobiles.


November 22, 2010

American Honda Motor Co. bestowed the 2004 President's Award to four area Honda dealerships, for outstanding sales and customer service. Recipients include Honda Motorwerks (Barrington), Honda Superstore of Lisle, Bill Kay Honda (Bourbonnais) and Muller Honda (Highland Park). Bredemann Ford in Glenview, Conlon-Collins Ford in Crystal Lake, Gjovik Ford-Mercury in Sandwich, Art Hill Lincoln Mercury in Merrillville, Ind., Kronon Motor Sales in Chicago, Roto Lincoln Mercury in Arlington Heights, and Terry's Ford Lincoln Mercury in Peotone were named winners of Ford Motor Co.'s 2004 Year-End Genuine Challenge. Cadillac named 80 dealers as SFE Platinum dealers, for outstanding sales, service and customer satisfaction. Local winners include Arnie Bauer Cadillac Co., Matteson; Ettleson Cadillac, Inc., Hodgkins; and Frank Shirey Cadillac, Inc., Oak Lawn. Mancari's Chrysler-Jeep (Oak Lawn), Mancari's of Des Plaines, and Mancari's of Orland Hills are among winners of this year's DaimlerChrysler Service Contracts Inner Circle. The award recognizes top DaimlerChrysler dealerships that sell service contracts for vehicle protection. Acura of Libertyville and McGrath Acura of Morton Grove were named to the 2004 Acura Precision Team-Dealerships of Distinction, the automaker's highest honor. In all, 42 U.S. Acura dealers won the award. General Motors Acceptance Corporation named eight area dealers as GM Protection Plan President's Circle winners, for top sales in 2004 of the GM protection plan and MRP vehicle service contracts. Winners include Gerard Haggerty Jr., Jerry Haggerty Chevrolet, Glen Ellyn; William Haggerty, Haggerty Pontiac- GMC, Villa Park; Lee Hoskins, Hoskins Chevrolet, Elk Grove Village; William Koloseike, Bill Kay Chevrolet, Lisle; Dan Kurtz, Sunrise Chevrolet, Glendale Heights; Mike Rakos, Bolingbrook Chevrolet; Mike Van Iten, Village Pontiac-GMC, Naperville; and Steve Zazove, Howard Pontiac- GMC, Elmhurst. Art Hill, Inc., and Art Hill Lincoln Mercury, both in Merrillville, Ind.; Metro Ford Sales & Service, Chicago; River Oaks Ford, Calumet City; and River View Ford, Oswego, were awarded the Partners in Quality Award for 2004 by Ford Motor Credit Co.