Car dealerships are a commonplace for negotiating deals, however, over the last couple of years sales representatives have been realizing they might actually be the ones getting the short end of those transactions. Two former sales representatives at Star Nissan Autogroup, one of the largest privately owned car dealerships of the NY metropolitan area, have brought a lawsuit against the company to try and remedy violations that they allege include failing to pay minimum wage, overtime, agreed upon wages, unlawful retention of wages, and unlawful deduction of commissions.
Star Nissan Autogroup is a franchise dealer for Chrysler, Jeep, Dodge, Fiat, Toyota, Scion, Hyundai, Nissan and Subaru and employs at least 500 people, over 150 of which are car salespersons, known as sales representatives. Unfortunately, Star Nissan’s massive success has come at the expense of these commissioned sales representatives. The lawsuit alleges that sales representatives were not paid proper minimum wages and overtime pay, and that the Star Nissan failed to calculate commissions in accordance with sales representatives’ commission agreement. In many instances a sales representative did not earn any commissions in a given pay period or did not earn enough commissions to reach the minimum wage and overtime requirements of the Fair Labor Standards Act (“FLSA”) and New York Labor Law (“NYLL”). Regardless of how many hours sales representatives worked or the amount of commissions they earned, sales representatives were not paid additional compensation.
Additionally, even though sales representatives were promised commissions based off of a percentage of the “back end” and “front end” gross for new and used vehicles, Star Nissan often failed to pay sales representatives in accordance with the agreed upon terms of their commission agreement. Specifically, commissions were often reduced by “packs” added to the “front end” of new and used vehicles. Star Nissan would also reduce the commissionable gross when a customer traded-in a vehicle for the purchase of another vehicle of a different make and model. Moreover, Star Nissan often gave sales representatives flat commissions on certain deals regardless of the profit margin on the “front” or “back end.” Such deals included, but were not limited to, deals where the vehicle was previously listed on Craig’s List, leased vehicles, and deals where the buyers require specially financed deals as the result of bad credit. As a result of these practices, sales representatives’ commissions are impermissibly reduced.
Furthermore, Star Nissan has a policy where it charged back its sales representatives’ paid commissions for reasons like repairs. These often unexplained charge backs were made weeks or months after the sales representative closed a deal, received the commission, and were given a commission breakdown.
Fitapelli & Schaffer, LLP believes Star Nissan unfairly implemented these practices across all of its locations, affecting hundreds of sales representatives. Current and former sales representative for all of Star Nissan dealerships should contact us to see if they are eligible to join the case. Please contact one of our employment lawyers by calling (212) 300-0375 for a free phone consultation or visit our website at fslawfirm.com.