July 8, 2011

Dear NJGCA Member:

Here's what you'll find in this edition of the NJGCA Road Warrior, and thank you for reading:

EXECUTIVE DIRECTOR'S MESSAGE: GREETINGS & SAL-UTATIONS!
•Beware that USDOL is watching your business!

NEWS AROUND THE STATE
•Unemployment rises to 9.2 percent, hiring stalls
•Lawmaker: Right to work law won’t be heard in New Jersey
•Legislative leaders seek to override Christie’s vetoes next week
•E15: Automakers oppose increasing ethanol content in motor fuel

TRAINING CLASS SCHEDULE
•ETEP TRAINING ADDED TO CLASS SCHEDULE!  See our THREE class options below!

MEET THE FOLKS AT LIBERTY GAS
•Looking for a new brand for your station? Take a look at the opportunity below!

MEMBER BENEFIT PARTNER MESSAGE
•TMP Energy Solutions: Another Way to Save On Your Energy Bills! 

REAL ESTATE FOR SALE OR LEASE
•Interested in acquiring or leasing a property?  See below!

A SPECIAL MESSAGE FROM BELLOMO FUELS
•Serving New Jersey since 1910 -- Over 100 years of supplying gasoline retailers like YOU!

POLITICAL PARTICIPATON: THE NJGCA PAC
•Participate in the NJGCA PAC today and help us keep our Agenda rolling in Trenton!

THE MEMBER TOOL BOX
•On the NJGCA Homepage
•Know your Territory Manager!

 EXECUTIVE DIRECTOR'S MESSAGE: GREETINGS & SAL-UTATIONS! 

OBSERVE & REPORT: BEWARE THAT USDOL IS WATCHING YOUR BUSINESS!

As a professional association, part of our role at NJGCA is to warn you of regulatory change, lobby on your behalf, and help you navigate the industry effectively.  However, sometimes our task is considerably simpler and direct; like when we tell you to pay attention to a certain situation or warn you that certain business practices are coming under scrutiny.

We have been warning you about the activities of the US Department of Labor (USDOL) since last November and that they are investigating gas stations nationwide. 

To get a better handle on what’s going on, I personally met with representatives from USDOL conducting the investigations yesterday.  What I learned is worse than we originally thought and I must continue to warn you that some types of business practices are not only frowned upon, but can also land you in hot water.

Currently USDOL has a nationwide effort to go after gasoline stations for breaking employment/labor laws.  What’s more, the initial, primary focus of this investigation is New Jersey, with imminent plans to expand the effort to Oregon.

Why New Jersey and Oregon? Because we are the only two states that do not allow self serve, and for the past several years, investigations have uncovered an extremely high amount of employer violations not complying with established labor laws.  In fact, we were stunned to learn that the compliance rate they have found in New Jersey be only around 40%!!

I spent 23 years in the gasoline service station business so I know how things are done.  That worries me right now, because apparently USDOL also knows how things are traditionally done, and they are out to stop it.

Yesterday these officials met me at my office to alert me about what they are doing, how they are doing it, and what they are looking for.  They are aware that when news of their operation broke a few months ago, that I went on a media blitz to defend you against headlines that read “NJ Gas Station are Ripping Off Their Employees”.  They shared some of their findings and revealed some interesting tactics hoping that I can begin to persuade you to change your practices and encourage you to begin doing things according to the law.

This is not a matter of agreeing or disagreeing with the law…….This is a matter of obeying and complying with labor laws that have been enforced for 70 years.

USDOL is looking for employees that are being paid ‘off the books’ and are not being paid the proper wages (particularly overtime violations). 

They are planning to audit every gasoline service station in the state one by one.  While they haven’t made it to every station in the state yet, they have plans in place to do just that over the next year.  It may take them awhile and there’ll be a lot of leg work involved, but they are serious about completing their task.  Presently they are choosing locations at random, staking out the facility, monitoring the hours of operation, and the number of employees that are pumping gas and working in the repair shop.  They are even conducting surveillance on weekends. 

After USDOL concludes their surveillance, investigators will visit the location.  They will enter your premises and begin segregating and interrogating your employees.  Then they will compare the results of their surveillance and the results of their interviews by matching them with your payroll records and tax returns.  Their goal, in part, is to learn as much as they can from your employees to match up against your own statements and your business records.  In doing so, they can figure out from all these sources and your payroll records if you are on the level or cheating the system!

Keep in mind that when they arrive, they already have a pretty accurate knowledge of how many people you employ, who they are, and when they work – so there is no fooling them.

Depending on what they find and how bad the non-compliance issues are at your location, they may go back at least three years to audit your books.  They may even take the trouble to locate and interview former employees to match up previous records and tax returns. 

USDOL has given me a heads up that there will be a public relations and press campaign to let the public know of their findings at New Jersey gas stations later this year. They won't tell me when, but I expect it will happen sometime in the fall.  They are also indicating that the headlines they are trying to achieve will not be pretty.

Let me warn you up front that they have told me that their findings are startling.  Among the few examples they have shared with me was the unbelievable fact that the average employee is due $3,500 in back wages.  A few they cited even had employees being owed upward of $10,000 in back-pay. Keep in mind that this still does not include the amount of taxes that were due on these wages.  What’s more, the USDOL officials I spoke with implied that they would be alerting the proper worker’s compensation authorities since worker's comp premiums are based on your payroll. 

However, while the discussion was both long and eye opening, it wasn’t merely a one-sided conversation.  USDOL has agreed to conduct several seminars around the state to instruct NJGCA Members on the proper way to compensate employees and comply with the law.  USDOL can instruct you how to properly pay your workers while still not paying out more than you are paying right now. 

A common violation that is found in almost every location is failing to display the proper work-place poster informing workers of their rights to be paid overtime.  USDOL has agreed to supply me with about 500 posters that I will begin distributing to you as soon as I get them.   Obviously 500 will not be enough, but USDOL also promises to mail these posters accompanied with letters to all of the gas stations in the state alerting you of their plans to investigate your payroll records at some point in the future. It is their hope (and mine) that in being notified, you may begin correcting any possible illegal practices prior to their arrival.

One important (and growing) problem for our society is the enormous numbers of illegal immigrants that are working at various jobs throughout our economy.  If you have illegal immigrants working in your business, this isn’t to be taken lightly.  However, unlike the Immigration and Customs Enforcement Agency (ICE), USDOL is less concerned about removing illegals from our work force and more concerned about having them ‘legitimately’ on your books.  By that I mean that USDOL wants you to figure out a way of putting anyone who is here illegally on your payroll ‘lawfully’, and if you can’t because they do not possess the legal papers you will require of them, then you must get rid of them.

Many of you may be scratching your head wondering how that last paragraph makes any sense, and trust me you wouldn’t be alone in that sentiment.  However, one must remember that USDOL’s only concern is that workers are paid the proper amounts they are due, and that they are paid ‘on the books’, regardless of their legal status.  They do this to protect workers rights and to make sure you are paying the proper amount of payroll taxes to our beloved Uncle Sam.  They will leave the issue of hiring illegal immigrants to the Immigration Enforcement officials.  That will be another headache separate from USDOL.

While I hope that no one reading this message would knowingly hire someone who is here illegally, the only way to address this problem without fear of retribution is through self help.  So, if you cannot find a way to keep them on the books, you can’t keep them at all.  No excuses.  The quarterly OTR will be in your mailboxes in a week, and there will be a short article about ‘E-Verify’ dealing with protecting yourself from repercussions of hiring ‘Illegal Immigrants’.

Some of you may be reading this message and thinking, “This doesn’t concern me; my employees and I have worked out a beneficial arrangement”.  While seemingly plausible, I must warn you that even if both parties agree to break the law and cover for each other, you are STILL breaking the law!  That means that even if your employee agrees 100% to be paid the wages you are offering or to work overtime at straight pay, it doesn’t mean you can escape any liability.  In fact, you may have just made things worse for yourself.  If you are in that situation, STOP DOING IT and start complying with the law!

You all know that I’m a free-marketer and I believe in the power of the market and individuals to make decisions for themselves far better than any politician or regulator.  What’s more, I suspect that most of you feel the same way or you wouldn’t be in business for yourselves today.  In fact, I made it abundantly clear to our guests from USDOL that I DO NOT AGREE with our established labor and compensation laws as they are currently written and interpreted.  However, as justified as I am in my thinking, I cannot deny the fact that these are the laws of the land and we are bound to them.  The unfortunate fact is that these labor and employer laws were put into place over 70 years ago and have incredible precedential power.  There maybe a time when a court challenge to these rules may succeed or business and free-market groups will finally have the opportunity to repeal them, but that day is not today.  So comply with the law until the law says differently!

USDOL isn’t playing games with any of us and I bet donuts to dollars that they’ll follow through with their promise to visit your location in the next year (if they haven’t already done so).  While their reasoning for this is entirely based on upholding the law, they are also trying to affect an established culture in our industry.  Though you may not agree or may choose to not participate in it, there undoubtedly is a mentality in this business that says it’s okay to either partially pay people what they are owed (that is, not paying them the overtime pay they are entitled to) or to pay someone under the table to avoid payroll taxes.  If you agree or not is immaterial; USDOL is out to change how we think about this topic and failing to comply may become an expensive lesson for some of us to learn.

Remember, I was in the same business and I know how the game is played!  The predecessors of ours that were in this business created the culture and we all followed as a matter of survival.  But the Federal Government is committed to ending the culture.  As long as they end the culture amongst everyone in the industry, then there is a level playing field.  For those that continue to practice the old and no longer acceptable culture, you will be cheating honest business owners that comply with the laws.

I haven’t even touched on New Jersey Department of Labor (NJDOL).  Some of the folks that are being paid ‘off the books’ or ‘cash under the table’, are doing so because they are simultaneously collecting unemployment and don’t want their income to be reported.  The USDOL opens the door to drag in NJDOL in the cases that are found to be probable ‘unemployment fraud’.  If your employee implicates you and indicates that you knowingly hired them while collecting unemployment in order to pay them less by paying them in cash, then that is a whole different pot of boiling water that you will need to be scooped out of.

I am giving you stern warning here because once you are in this hot water; there isn’t anyone for me to call, or anyone that I can request leniency or mercy from.  The facts will be the facts and the authorities intend to be tough.  It is the only way they can end these illegal practices because they are so prevalent in the industry.

I’ll keep you updated as new information becomes available.  In the meantime, if anyone has any questions on this, please feel free to reach out to me at your convenience. 

Thanks for listening - See you next week!

Regards,
Sal Risalvato
Executive Director

NEWS AROUND THE STATE

7/8/2011:
Unemployment rises to 9.2 percent, hiring stalls
National unemployment numbers rose to 9.2% in June as employers added the fewest number of jobs to the economy in nine months.  The new figures come as the United States Department of Labor created only 18,000 net jobs last month and revised job numbers down to 25,000 jobs in May.

7/8/2011:
Lawmaker: Right to work law won’t be heard in New Jersey
After the landmark passage of pension and benefit reforms signed into law last month, pro-business legislators have introduced legislation that would change state labor laws to make New Jersey a right-to-work state.  If made law, it would permit public- and private-sector workers with union shops to opt out of joining or paying dues.  However, General Assembly Speaker Sheila Oliver has said that the legislation is ‘dead on arrival’ and it is unlikely to get a hearing, much less get passed, in Big Labor-friendly New Jersey. Click above to read the full article.

7/7/2011:
Legislative leaders seek to override Christie’s vetoes next week
Lawmakers plan on meeting next week in an attempt to override the Governor’s veto on a handful of programs that were cancelled before the Governor signed the 2011-2012 state budget into law.  The projects were cancelled when Governor Christie used his line-item veto powers enumerated in the New Jersey Constitution last week to trim the state budget by $900 million.  However, in order to override the veto, Legislative leaders need 2/3rds vote (versus a normal majority vote) in order to succeed.  Click above to read more on this story.

7/6/2011:
E15: Automakers oppose increasing ethanol content in motor fuel
As the federal EPA gears up to change the amount of ethanol sold in the average gallon of gasoline, they are experiencing stiff opposition from automakers.  Car manufacturers such as BMW, Toyota, Honda and others say that using E15 blended motor fuel (gasoline made up of 85% gasoline and 15% ethanol) would damage engines in vehicles made prior to 2001.  Read more on this issue by clicking the link above.   

CLICK HERE TO READ MORE ARTICLES IN OUR “NEWS AROUND THE STATE” ARCHIVE 

MEMBER BENEFIT PARTNER MESSAGE

TMP Energy Solutions
Another Way to Save on Your Energy Bills

We have had a number of NJGCA members successfully reduce their rate per kWh   signing up through our energy saving program. We know it’s difficult to collect 12 months worth of previous electric bills to get an “accurate” analysis when comparing a variable rate to a fixed rate, but we now have another option available. 

This new solution is a power purchase option; the other program is still in full force and has saved members thousands of dollars. If you sign up for the power purchase option, you will be grouped with other NJGCA members until the minimum KW demand is acquired. By pooling the member’s usage together, you will be able to take advantage, as large energy users do, and receive a lower kWh rate.

Each member will receive their own contract. Each member is responsible to sign and return the agreement the day it is received in order to secure the price for their group.

Please do your due diligence, so when you receive the proposal and the agreement you will be able to make an intelligent decision.

If by chance, you still want us to assess you bills, to give you a price to compare, we will require12 months of your most recent utility bills.

There are no bills required, but we would still like to have one bill per meter on file to check account #’s, meter #’s  service addresses and other pertinent information incase there is a problem.

The term of the agreement is for 12 months. During this term period, you will have price protection against any energy price increases along with a low fixed kWh rate.

If you are interested in becoming part of this power purchase option, please contact Phil Apruzzi at the NJGCA.

Remember when you sign up your energy through the NJGCA Energy Program, TMP makes a considerable donation to the NJGCA Scholarship Fund through their proceeds. This has no affect on your rate, and costs you nothing out of pocket.

We hope to help hundreds of NJGCA members reduce their utility costs by participating in this and our other cost reduction programs.  Our purpose, in the endeavor, is to help NJGCA members lower their energy costs while supporting the NJGCA Scholarship Fund. 

Contact Phil Apruzzi at 973-376-0066 or email Phil at phil@njgca.org. Mention that you are interested in saving money on your energy bills. NJGCA & TMP Energy Solutions will handle all the rest.