Hendrick Group Sued Due to Commissions
March 23, 2018—Thirty-three former salespeople at Rick Hendrick Chevrolet Naples in Florida are in the process of suing the dealership’s parent company, alleging that the dealership group took actions that deliberately reduced their commissions.
The dealership allegedly combined fictitious or extravagantly inflated costs to sales associates’ deals, thereby utilizing sum margins to compensate smaller commissions. The added costs (for markups like cleaning and detailing) cut commissions earned on vehicles to the mandatory minimum of $200 per sale, according to a report by the Naples Daily News.
That was also noted in a censure filed in February in the 20th Judicial Circuit in Collier County, Fla.
According to the suit, the sales associates, who worked strictly on commissions, were to get paid a gross profit of 25 percent on new cars and 30 percent on used cars, with the guaranteed minimum established at $200, based on their contracts. The plaintiffs allege the dealership, at the direction of Hendrick, engaged in deceitful practices to manipulate its sales numbers so it could pay lower commissions, and that it refused to provide an accounting of their deals.
The lawsuit pronounced an indemnification for breaking contract, and breaking a pragmatic compact of good faith and satisfactory dealing, fraud, and delinquent salary surpassing $75,000.
A reported 250 Hendrick sales associates in Florida could be included in the lawsuit, and even more if the suit eventually includes all 102 Hendrick dealerships; the Hendricks Automotive Group is the nation’s sixth-largest dealership organization.
The next court date for the lawsuit was scheduled for Friday, for a case management conference. If the case is certified as a class action, it could take at least two years to solve, the Daily News reported.