By Toby Graham, Compli 

Who doesn’t love straight talk from an attorney? One of my favorite aspects of our Definitive Guide to Workforce Compliance for Dealersare 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 some another highlight of our conversation: Steve’s advice for dealerships facing or hoping to avoid a discrimination lawsuit. Don’t miss Part 1 or Part 2.

1. Use an Arbitration Agreement
“If an employer has a working arbitration agreement that requires the employees to pursue the claim in arbitration as opposed to in a court of law, if it’s done properly it can really have a significant impact on the number of claims that are brought.

In the process of litigating or arbitrating those claims, you can get a better control over the runaway claim because you’re not worried so much about being in a very plaintiff-friendly jurisdiction. For some of my dealer clients in particular parts of the country that are known for being very aggressively pro-employee or pro-plaintiff, it’s helpful to consider entering into an arbitration agreement. Jury trial waivers can be helpful as well. Arbitration agreements that have class action waivers can be very effective, too, because that waiver will prevent the individual from getting a class action up and running. Class action cases are very costly because they’re so big.

There has been pushback by the National Labor Relations Board. The Board has taken the position that arbitration agreements that contain class action waivers are in violation of the National Labor Relations Act. The thinking there is that if the NLRA prohibits an employer from doing things to prevent employees from acting in concert with one another, then they’re saying that’s what you’re doing with an arbitration agreement with a class waiver—you’re saying: “You may not participate in litigation with those other co-employees.’

Now, employers say, ‘Well, wait a second. Participating in litigation isn’t really a term and condition of employment.’ It’s not the same thing. It remains to be seen how that’s going to shake out. I think we have to wait to see what a Trump administration and its Department of Labor will think about this. I would suspect the NLRB’s approach to arbitration agreements won’t get much traction in the new Trump DOL, but it remains to be seen. So, arbitration agreements are one best practices we can look to in order to keep claims down and manage them effectively.”

2. Invest in a Better Organizational System

“Another thing that is very helpful is having some system in place that would enable an employer to produce those documents in an efficient way right at the beginning of a case. For example, if there’s an arbitration agreement, it’s knowing that there’s a system, methodology, or automation process that enables the employer to quickly spit out, ‘Yeah, here’s the arbitration agreement the employee signed.

Here’s the harassment policy that the employee signed. Here’s the reporting procedure and the open door policy that the employee signed.’ Getting those things quickly and effectively in litigation and getting them produced in discovery can help change the direction of litigation at an early stage.

In the old days, it used to be that was just your personnel file. But technologically savvy dealerships and other employers have a lot of this automated now in a way that can make sure they always have all this information instead of simply hoping it’s in the personnel file when they need to go get it for a case.”

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