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Top introductory components of a dealership employee handbook

November 17, 2010

Franczek Sullivan, the CATA’s labor relations counsel, has developed an Employee Relations Handbook Starter Kit for auto dealers. As its name suggests, the Starter Kit offers a running start on the process of developing an employee handbook.

"We strongly recommend employee handbooks that are accurate and communicate effectively to all employees.," said Franczek Sullivan’s Dave Radelet. "At the same time, it can be a serious mistake for dealers to simply copy a model employee handbook obtained from an outside source without working through the various policies and customizing the handbook to their dealership."

The Starter Kit provides sample language for a number of topics and examines various issues that often are handled differently by different dealers. The Starter Kit, which is designed to comply with applicable Illinois and federal law, is available to CATA members for $500. Call Mary Casto at Franczek Sullivan at 312-986-0300.

According to the NADA, more policies are becoming standard components of effective employee handbooks and usually are part of introductory material. Some share the dealership’s philosophy; others just make good legal sense.

Welcome Letter, signed by dealer
This conveys a sense of team spirit and cooperation. Be supportive and appreciative of current employees and offer a warm welcome to newcomers.

Dealership History
This educates employees about the company origins. Be sure to mention awards and community recognition.

Introductory Statement and "At-will Disclaimer"
This statement explains that the handbook is an informational guide for employees and does not create a binding contract. It also helps the employer retain his ability to terminate employees "at-will" (i.e., with or without cause) to the extent possible under federal, state, and local laws. The statement should cover the following points:

  1. State the date the handbook becomes effective and that it replaces all previous handbooks and policies.
  2. Clearly state that policies outlined in the handbook in no way constitute a contract and that they should not be considered as such.
  3. Explain the dealership’s policy of "at will" employment, i.e., that the employee may end his/her employment at any time and for any reason and that the employer has the right to terminate the employee at any time and for any reason within the constraints of federal, state and local laws.
  4. Finally, state that only the dealer (or a person the dealer specifically designates) has the authority to enter into an agreement of employment for any specified period of time or to make any promises of continued or permanent employment. Note: Remember to use simple language. It is important that all employees fully understand the issues covered in the introductory statement.

This article is excerpted from Developing an Employee Handbook (ER06). To learn more about personnel policies, and to create a professional employee handbook on your own PC, take advantage of NADA’s Policies Now! program on CD-ROM. Both products can be ordered at or 800-252-6232, ext. 2.