Pub. 1 2013 Issue 3

Resale Certificates for Auction Vehicle Purchases In recent years, the Board of Equalization has discovered widespread noncompliance with sales tax remission and reporting requirements relating to vehicles purchased from dismantlers and auctions. AB 2618 was passed to address the problem by creating a rebuttable presump- tion that any vehicle purchased from a dismantler or at any auction is purchased at retail—meaning sales tax applies to the transaction. This presumptionmay be rebutted, however, if the resale certificate presented to the dismantler or auction contains the Dealer License Number of the purchasing dealer. The Board of Equalization has announced plans to pass a regulation providing a model resale certificate form to be used for auction transactions. Dealer Impact: Dealers must write their Dealer License Number on resale certificates used to purchase vehicles at auction. Dealers should begin using the Board of Equalization’s revised resale certificate for such vehicles once issued. RecycledWater Mandate for Future Carwashes Several local governments impose restrictions on the use of freshwater by commercial carwashes (which include dealerships). AB 2230 imposes the first statewide mandate on carwash facilities, requiring any in-bay or conveyer carwash built and permitted after January 1, 2014 to either: Install, use, and maintain a water recycling system that recycles and reuses at least 60% of its wash and rinse water; or Use recycled water provided by a water supplier for at least 60% of its wash and rinse water. While many commercial carwashes already have water recycling functionality, many become clogged with debris—leading the carwash to disable the recycling function. The bill requires that carwashes built beginning 2014 not only have such recycling functionality, but that it is actually used. Dealer Impact: This bill will require future carwashes to include a water recycling system to recycle and reuse 60% of the wash and rinse water, or to use recycled water provided by a water supplier for at least 60% of such water. Dealers who are considering installing or replacing carwash equipment may wish to do so prior to 2014, or must make sure that such equipment complies with the new standards. New Employment Laws Written Commission Pay Plan Requirement Two bills took effect January 1 st requir- ing that all employment agreements involving commissions be put in writing. The mandate requires that the written agree- ment contain a complete and accurate description of all terms of commission calculation and payment. A signed copy of the agreement must be given to the employee, and the employer must receive a signed document acknowledging receipt of the agreement. To prevent spiffs and other temporary programs from triggering a requirement for an entirely new payplan, CNCDA sponsored legislation in 2012 to clarify that the types of commissions that must be placed in writing do not include: Short-term productivity bonuses; Temporary, variable incentive payments that increase payment under the written agreement; or Bonus and profit-sharing plans, unless an offer has been made by the employer to pay a fixed percentage of sales or profits as compensation for work to be performed. Accordingly, the pay plan should provide a detailed description of the “base”commission; all other commissions (such as Customer Satisfaction or Unit Volume commission“kickers”) should be identified as temporary variable commissions that increase the base commission so that changes can be made to those increased commission factors without having to issue new pay plans every time a change is made. Dealer Impact: Dealers should work with competent employment counsel to ensure that all payplans involving commissions are put into writing in compliance with these new laws. Ban on Requesting Employee Social Media Information In response to a number of employers that have required prospec- tive or current employees to either divulge private social media login information or to log into and demonstrate private social media content in the presence of the employer, several states have recently enacted legislation to limit such practices. AB 1844 marks California’s attempts to address these concerns. The bill defines“social media”broadly to include videos, photographs, blogs, video blogs, podcasts, instant and text messages, email, online services or accounts, or Internet Website profiles or locations. The bill prohibits employers fromnot only requiring, but even requesting that a current or prospective employee do any of the following: Disclose a username or password for the purpose of accessing personal social media content; Access personal social media content in the presence of the employer; or Divulging any personal social media content. These restrictions do not affect existing rights of employers to request that an employee divulge personal social media content reasonably believed to be relevant in an investigation of alleged employeemisconduct or a legal violation, as long as the information is used solely for purposes of the investigation or related proceeding. Employers also retain existing rights to require or request employees to disclose login information for the purpose of accessing an employer-issued electronic device. The law specifically prohibits employers from actual or threatened discipline or discharge, or any other form of retaliation for not adhering to a request or requirement that violates the new law. Continued from page 19