Not only is discrimination costly in financial terms, but publicity surrounding lawsuits hurts a dealership’s reputation. It carries costs, too.
“That will never happen here,” the dealer principal says of a sexual-harassment suit slapped on a competitor. “We’re all more grown-up around here than that,” he says, looking up to admire a new female employee in payroll.
In the general sales manager’s office, a man of Middle Eastern descent is interviewing for a sales position. The manager already has formed opinions and plans to run a criminal background check the minute the job candidate departs.
In service, Lucy, a service advisor, is excited to share with her boss and colleagues that she and her husband finally are going to have a baby. Roy, the service manager, knows what that means and already is scheming how to replace Lucy with a man who won’t want all that time off.
Such a dealership becomes fair game for the U.S. Equal Employment Opportunity Commission, which takes discrimination and harassment cases seriously.
Such offenses in all forms are rude, immature, illegal and, if proven, costly. Some recent headlines:
- “Car Dealership Pays $244,000 to Settle EEOC Sexual Harassment and Retaliation Lawsuit”
- “ Dealership pays $400,000 to Settle Sexual Harassment and Retaliation Lawsuit”
- “Car Dealership Settles Racial Discrimination Lawsuit for $300,000”
Let’s review the law verbatim from the EEOC.gov website: “It is illegal to discriminate against someone (applicant or employee) because of that person’s race, color, religion, sex (including pregnancy), national origin, age (40 or older), disability or genetic information.
“It is also illegal to retaliate against a person because he or she complained about discrimination, filed a charge of discrimination, or participated in an employment discrimination investigation or lawsuit. The law forbids discrimination in every aspect of employment.”
This law weaves its way through all aspects of how to do business and treat employees.
It covers job advertisements, recruitment, hiring, job assignments, promotions, pay, benefits, discipline, discharges, reasonable accommodation for the disabled, training and apprenticeship programs, employment terms, pre-employment inquiries and dress codes.
Not only are discrimination lawsuits costly in financial terms (yes, insurance can mitigate the risk); publicity surrounding such suits hurts a dealership’s reputation. It also carries other costs, such as:
- Decreased productivity.
- Decrease in meeting goals.
- Loss of staff, from harassment victims to offenders.
- Increased health-care costs due to stress- and health-related consequences of the harassment.
Discrimination on the job comes in many forms. EEOC currently is focusing on the use of criminal background checks of job applicants by employers who may be using the checks unfairly against minority applicants.
The dealership environment is especially prone to many types of harassment, particularly sexual harassment. Primarily male staffers work closely together, and the environment is fast-paced and often stressful.
These factors can result in employees doing or saying inappropriate things they probably would not do or say under different circumstances.
Just as the dealer principal ultimately is responsible for the store’s profitability, so too is he or she responsible for a discrimination-free workplace. The best defense is to prevent violations.
An audit of EEOC-compliance practices can show where the dealership is complying with regulations, and where its processes to manage EEOC issues and employee complaints may need improvement. The dealer can breathe easier while improving staff attitudes and actions.
Dealers should provide EEOC-focused training for all staff, hold management accountable for enforcing nondiscrimination policies and take employee complaints seriously.
It is always best to be proactive about this type of training. The EEOC requires training as part of settlements in reaches in discrimination cases.
Failure to train your employees in this area is often seen by the EEOC and the courts as an intentional violation. That brings with it punitive damages. Be smart and don’t wait for that to happen.
Former auto dealer Terry Dortch is president of Automotive Compliance Consultants. Reach him at firstname.lastname@example.org