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SF 827

as introduced - 93rd Legislature (2023 - 2024) Posted on 07/05/2023 03:50pm

KEY: stricken = removed, old language.
underscored = added, new language.
Version List Authors and Status
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Current Version - as introduced

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A bill for an act
 relating to commerce; modifying motor vehicle warranty labor compensation;
amending Minnesota Statutes 2022, section 80E.041, subdivision 4.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2022, section 80E.041, subdivision 4, is amended to read:


Subd. 4.

Retail rate for labor.

(a) Compensation for warranty labor must equal the
dealer's effective nonwarranty labor rate multiplied by the time deleted text begin allowances recognized by
the manufacturer to compensate its dealers for warranty workdeleted text end new text begin guide used by the dealer for
nonwarranty customer-paid service repair ordersnew text end . The effective nonwarranty labor rate is
determined by dividing the total customer labor charges for qualifying nonwarranty repairs
in the repair orders submitted under subdivision 2 by the total number of labor hours that
generated those sales. Compensation for warranty labor must include deleted text begin reasonabledeleted text end new text begin allnew text end diagnostic
time for repairs performed under this sectionnew text begin and must not be less than the time charged to
retail customers for the same or similar work performednew text end .

(b) A manufacturer may disapprove a dealer's effective nonwarranty labor rate if:

(1) the disapproval is provided to the dealer in writing;

(2) the disapproval is sent to the dealer within 30 days of the submission of the effective
nonwarranty labor rate by the dealer to the manufacturer;

(3) the disapproval includes a reasonable substantiation that the effective nonwarranty
labor rate submission is inaccurate, incomplete, or unreasonable in light of a comparison
to the retail rate charged by other similarly situated franchised motor vehicle dealers in a
comparable geographic area in the state offering the same line-make vehicles; and

(4) the manufacturer proposes an adjustment of the effective nonwarranty labor rate.

(c) If a manufacturer fails to approve or disapprove the rate within this time period, the
rate is approved. If a manufacturer disapproves a dealer's effective nonwarranty labor rate,
and the dealer does not agree to the manufacturer's proposed adjustment, the parties shall
use the manufacturer's internal dispute resolution procedure, if any, within a reasonable
time after the dealer notifies the manufacturer of their failure to agree. If the manufacturer's
internal dispute resolution procedure is unsuccessful, or if the procedure is not implemented
within a reasonable time after the dealer notifies the manufacturer of their failure to agree,
the dealer may use the civil remedies available under section 80E.17. A dealer must file a
civil suit under section 80E.17, as permitted by this subdivision, within 60 days of receiving
the manufacturer's proposed adjustment to the effective nonwarranty labor rate, or the
conclusion of the manufacturer's internal dispute resolution procedure, whichever is later.