Who doesn’t love straight talk from an attorney? One of my favorite aspects of our Definitive Guide to Workforce Compliance for Dealers are the interviews. Along with infographics and worksheets, we had the opportunity to record conversations with industry-leading HR, compliance, and legal experts, and their insights are the kind you don’t hear every day.
Take our conversation with attorney Stephen J. Roppolo. Steve serves as one of the key figures at the head of Fisher Phillips, a law firm with a dedicated Automobile Dealership practice group—and one of our frequent collaborators. And while he may be a managing partner, Steve is really an entrepreneur at heart. Growing up in a small business family, he realized early on that by immersing himself in labor and employment law, he could help grow not just one company, but many.
“Every business entity in the country has to deal with labor and employment issues,” he told us. “If I wasn’t going to be running my own business, I could help other people run theirs.” It wasn’t long before he fell in love with the fast-paced, high-energy world of automobile dealerships. These days, Steve provides counseling and representation to dealers of all kinds, assisting with everything from litigation and arbitration to everyday communication with employees.
In our guide, we spoke with Steve about the advice he gives to his clients, what legal issues dealers need to focus on now, and what the future of the automotive industry has in store. Today, we’d like to share another excerpt of our conversation. If you missed Part 1, click here.
You advise your clients to always be honest with their employees. What can you say about performance evaluations?
STEPHEN J. ROPPOLO: If you’re not going to take doing performance evaluations seriously, then just don’t do them at all. There’s almost no point if you’re not going to dedicate the time and energy necessary to running an effective performance appraisal process. I understand, because I’m a manager, how it can be a pain. I know that running through someone’s strengths and weaknesses when you’ve got 16 other things to do is not at the top of your list. And so they often get put off until the 11th hour, and then all of a sudden you’re just screaming through 25 employee evaluations and you’re not giving them the proper amount of time, you’re checking boxes without really thinking about what you’re really saying to the employee in the way of assessment.
The other thing is that everybody’s not above average. That’s what happens in most performance appraisal programs, is that you look at the overall ratings for people and everybody’s above average. You’ve got a few people who were excellent, a few people who are very good, a lot of people who are good, and maybe three people who are average. That’s it. Where are the rest of the people? But you’re firing people because they’re poor performers, and yet you’re having to acknowledge that the performance evaluation says that they’re okay. And that’s a problem. That performance evaluation will be one of the top exhibits for the other side, for the plaintiff’s side at the trial or arbitration.
What other trends have you seen across dealership’s HR departments?
Employers, and auto dealers in particular, are always looking for ways to both automate and systematize their human resources’ functions to make it simpler for the fewer people who are working in these departments to do their jobs. I’ve found that many auto dealers are trying to run lean and mean when it comes to a human resources function.
Back 20 years ago, I would run into dealerships that had no HR function whatsoever. The poor controller was doing everything: payroll, HR, accounts payable, accounts receivable, inventory. And while that’s not quite the same as it used to be, there’s no doubt there are a lot of dealerships that do keep the back office staff to a minimum.
It’s incumbent upon dealers that do run lean to try to give those people the tools necessary to make sure that they’re able to leverage themselves to the point where they can cover all the things they need to cover, especially in HR. In HR, there are so many things to keep in mind about what you have to do, merely from a reporting standpoint: posting, document retention, and so on.
Also, in terms of specific issues, dealerships can get into all kinds of problems with the classification of independent contractors. I’d say that’s one of the areas that I would see as a policy or procedure that an employer would really want to take a look at and ask themselves: “Are we doing this correctly?”