Dealership Pay Plan Attorney, Lawyer: Paying Management and Finance Managers Under the Dealership Pay Plan

Dealerships not paying their staff properly?


Dealership Pay Plan Attorney, Lawyer:   Paying Management and Finance Managers Under the Pay Plan must be the same as sales staff and the dealer MUST pay them properly under the pay plan.  There are other issues here such as Dealer Cash-Spiffs-Reserve-Reserve Bonuses-bonuses for aftermarkets and many other issues a pay plan lawyer must review.

  • Have you been paid properly?
  • Has you pay plan been honored?
  • Are costs being inflated?
  • Do charge backs seem high or improper?
  • Are there similar issues with the sales staff and their gross commissionable proceeds?
  • Are you being paid properly?
Most finance and upper management positions have back end deals in the form of  a percentage of the profits. There are more issues with the costs of aftermarket items and various packs that go to the parent corporations. Other issues include pricing on items sold by captive subsidiary corporations, which many times are owned by the parent corporation owner or his family members. Holdback and dealer cash are also issues, regarding what is included in profits, increasing the managers' commissions.


Many times, in my experience, even the upper management such as finance managers are not fully aware of what is occurring.

To really understand this concept you really need to understand how a dealership is run as I am certain that any finance manager or salesman or sales manager reading this website knows exactly what I am referencing.

The software systems and the accounting and the money part of the operation are never really, fully, and accurately disclosed to even the finance managers. There is a common term of art in the business called penciling.  The dealership employee should have heard of this term. Usually, the penciling happens in the accounting office with accounting clerks or the Comptroller. It is these individuals who literally hand write in pencil the reduction in commissions increasing various costs. It is so common in the business that the only thing that changes from dealer to the dealership is the amount of the penciling and the type of pay plan. If the pay plan is Pro salesperson then it is not proper. If the pay plan is Pro management and Pro dealership profit the penciling probably would be proper. You have to understand that it is all in the context permitted by the dealership personnel. Some the parents cannot permit the dealership to is Some plans permit the dealership to do as they wish

The finance managers are entitled to obtain proper pay the same as the salespeople in the same is the ownership. For some unknown reason numerous times dealership does not implement the pay plan and a method to fairly pay the employees. There is a written pay plan. Employees get paid on profit. The issue is how do you calculate the profit. Trust is a central factor.

Many times, the finance managers and the sales staff do not receive a specific breakdown of the method by which the profit is calculated. At the end of the week with the end of the month of the pay period they will receive a commission sheet showing them the car they sold and their commissions. The cost is not shown. Sometimes profit is not even shown or explained.

This situation is ripe for abuse. The dealership can without supervision any cost on the vehicle, decreased the profit, decreased the gross commission able proceeds and not properly pay the sales staff. They need to keep the conduct which they do likable many safeguards and separate software systems. Many times, the accounting office is not open to the rest of the dealership. Sometimes the accounting office is not even at the dealership in the same building as the rest of the employees. Generally, the dealership takes every effort to separate the county office the rest of the dealership. People to work in the accounting office are not salespeople nor were they ever the business as sales for finance managers.

There very clever. Ultimately in litigation they are unable to hide their conduct. Sooner or later the proper cost of the vehicle is accounted for in a computer system. Sooner or later the numbers are discovered, the computer system is discovered, and the true cost of the vehicle is discovered. When the true cost of the vehicles is discovered and is compared to the pay plan to determine whether or not the dealership has properly compensated the employees. And that many of the cases I have handled it has been that the dealership has not properly compensated employees, in many ways

Sometimes the employees are left in a difficult dilemma. Let's say that the finance manager for the sales manager discovers that there is a discrepancy or an issue of the pay while employed. It is not uncommon for the employee to go to management and request an explanation as to why the pay does not appear to be correct. It is not uncommon for these requests for clarification to be ignored for months and months. On numerous occasions employees have confronted management demanding an explanation. Usually, no explanation is forthcoming. What happens when there is no explanation despite numerous requests? Employees are put in a difficult position of having to advocate with management about their pay. There is always the risk of being fired or blackballed if persistent requests go on with the management. Then the employee is left with very limited options. The employee considers.  The employee can file a complaint with the state authority pertaining to lost wages. The employee can go to another dealership.

The employee can continue with the complaints and become a pain for management to deal with in the context of getting paid. In the circumstances you must consult with an attorney in whatever state you are residing to determine whether you might have a claim if you are fired, or there is a negative employment decision, regarding litigation. There is a potential that some states might provide a cause of action if an employee is fired for inquiring about wages which the employee thinks were improperly held. This is a state-by-state determination. I strongly suggest you consult with a local attorney on the law in your state.

The auto industry is a very difficult place to work. If management is not working with you and you have a complaint or question about your wages need to be very careful. You could get fired, you could get blackballed, you could get demoted without any remedy. Then, as a practical matter, how do you go to another dealership when you have a difficult separation your current dealership. These are all considerations that must be considered when having an issue with your wages and deciding to litigate the case.

There are law firms that specialize in employment law. There are law firms that specialize in auto industry litigation. There are law firms that specialize in litigation. You need to determine the type of lawyer you need, and you need to have some idea as to what the state laws are the employer employee relationship and how that applies to your situation.  You do not want to get blackballed from the industry but at the same time you want to make sure your rights are protected. Want to make sure that you can continue to earn for your family while your rights are protected. Moreover Lee, you want to make sure that you’re not going to be blackballed out of the auto industry if you make complaint for filing a lawsuit. These are considerations that you have to understand both from a legal point of view and from a common-sense point of view.

As a practical matter, you have any records pertaining to wages you need to save them to document what you have received to compare them as to what you should be receiving.

A lawsuit against the car dealership employer can be a very daunting experience. You need an experienced attorney who preferably has sued a car dealership before and is familiar with the terms in the industry and familiar with the software such as those implemented by many dealerships including but not limited to ADP and Reynolds and Reynolds.

These litigation attorneys experiencing car dealership litigation can help you in the processing of your claims if you assert that you are improperly or wrongfully paid in violation of your pay plan with your employer, car dealership