Legislature(2013 - 2014)BELTZ 105 (TSBldg)
04/03/2014 03:30 PM Senate LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| HB32 | |
| HB276 | |
| HB234 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 32 | TELECONFERENCED | |
| + | HB 276 | TELECONFERENCED | |
| + | HB 234 | TELECONFERENCED | |
HB 276-MOTOR VEHICLE DEALER EMPLOYEES
3:45:03 PM
CHAIR DUNLEAVY reconvened the meeting and announced the
consideration of HB 276. "An Act making the Alaska Wage and Hour
Act inapplicable to certain employees of motor vehicle dealers;
and providing for an effective date." This was the first
hearing.
3:45:11 PM
REPRESENTATIVE STEVE THOMPSON, Alaska State Legislature, Juneau,
Alaska, sponsor of HB 276 introduced the bill paraphrasing the
following sponsor statement: [Original punctuation provided.]
House Bill 276 clarifies that auto salespersons and
service writers are exempt from Alaska's Minimum Wage
and Hour Act. These individuals are paid on a
commission basis and are not and have never been
hourly employees.
HB 276 is a result of confusion caused by previous
regulations from the Department of Labor and Workforce
Development that defined straight commission as "a
fixed percentage of each dollar of sales an employee
makes." This became interpreted as meaning the
commission must be applied to the gross amount of a
sale.
While that interpretation might be appropriate for
some commission sales, it is neither appropriate nor
customary for auto sales. The prime reason is that the
auto dealer must pay for the vehicle first out of the
sale price. Advertising laws prevent an "add-on"
charge to an advertised sale price to accommodate a
commission. Thus, is the net of a sale is 3% of the
gross, the dealer cannot pay a commission of 5%. This
legislation allows for auto dealers' common practice
of using a net amount against which the commission is
applied.
The Department of Labor and Workforce Development did
amend its regulations and has been extremely helpful
working with the Alaska Auto Dealers Association on
this issue. However, as a result of litigation and
with the advice of legal counsel, we believe that it
is necessary to seek final clarification in statute.
3:47:16 PM
JANE PIERSON, Staff, Representative Thompson, Alaska State
Legislature, Juneau, Alaska, provided a sectional review of HB
276.
Section 1 amends AS 23.10.055(a). It exempts from the minimum
wage act auto service writers, individuals who arrange financing
for motor vehicle sales and individuals who solicit, sell,
lease, or exchange motor vehicles.
Section 2 adds a new subsection (d) to AS 23.10.055 to define
"lease," "motor vehicle," and "motor vehicle dealer."
CHAIR DUNLEAVY asked if there is a fiscal impact.
MS. PIERSON said no.
SENATOR OLSON asked if the Ford dealer in Fairbanks has a
position on the bill.
REPRESENTATIVE THOMPSON replied that he didn't have direct
communication with that dealership, but the former Senator has
not opposed the legislation.
3:49:24 PM
STEVE ALLWYNE, Board Member, Alaska Auto Dealers Association,
stated that he knows the former Senator personally and can
assure the committee that he does not object to the bill.
SENATOR OLSON asked if anybody has problems with the bill.
MR. ALLWYNE said he wasn't aware of any problems.
CHAIR DUNLEAVY announced that he would hold HB 276 in committee
for further consideration. Public testimony was open.