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H 4019

An Act to ensure fair compensation for warranty service labor

194th Legislature (2025-2026) Introduced by Shirley Arriaga

Bill H 4019 ensures Massachusetts automotive dealers receive fair compensation for warranty service labor, aligning rates with non-warranty services for transparency and equity.

Accompanied a study order, see H5320
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Bill Summary · H 4019

Summary of Bill H 4019: An Act to Ensure Fair Compensation for Warranty Service Labor

Bill Information:
- Bill Number: H 4019
- Title: An Act to ensure fair compensation for warranty service labor
- Status: Senate concurred
- Introduced: April 10, 2025
- Classification: Bill
- Primary Sponsor: Shirley B. Arriaga (8th Hampden)

Purpose and Intent

Bill H 4019 aims to establish fair compensation standards for warranty service labor performed by automotive dealers in Massachusetts. The legislation seeks to ensure that dealers are compensated at a rate that reflects the customary retail labor rates for non-warranty service, thereby promoting fairness and transparency in the automotive service industry.

Key Provisions

The bill amends Chapter 93B of the General Laws, specifically focusing on the compensation structure for warranty service labor. The key changes include:

  1. Establishment of Labor Rates:

    • Dealers can establish their retail labor rates based on:
      • Reasonable labor time allowances defined by a retail labor time guide used for non-warranty, customer-paid service.
      • Submission of either 100 sequential non-warranty service repair orders or 60 consecutive days of such orders (whichever is less) to the manufacturer or distributor. This data must cover repair orders made within the last 180 days.

  2. Calculation of Labor Rates:

    • The labor rate will be calculated by dividing the dealer's total labor sales by the total labor hours that generated those sales. This calculated rate is presumed to be fair and reasonable.

  3. Implementation Timeline:

    • The declared labor rate will take effect 30 days after submission, subject to an audit by the franchisor. If the franchisor disputes the declared rate, they must propose an adjustment within 30 days.

  4. Dispute Resolution:

    • If a dealer disagrees with the proposed adjustment, they can file an action in court within 30 days. The burden of proof lies with the manufacturer or distributor to demonstrate that the dealer's declared rate was inaccurate or unreasonable.

  5. Definition of Fair Compensation:

    • The bill clarifies that "fair and reasonable compensation" is defined as the reasonable labor time allowances from the retail labor time guide used for non-warranty service.

Impact

This legislation primarily affects:
- Automotive Dealers: Ensures they receive fair compensation for warranty service labor, aligning their rates with non-warranty services.
- Manufacturers and Distributors: Places the onus on them to justify any disputes regarding the labor rates declared by dealers.
- Consumers: May indirectly benefit from improved service quality and transparency in pricing as dealers are incentivized to maintain fair labor practices.

Legislative Actions

  • April 10, 2025: Bill introduced and referred to the committee on Labor and Workforce Development.
  • April 14, 2025: Senate concurred.
  • November 5, 2025: Discharged to the committee on Consumer Protection and Professional Licensure.
  • November 10, 2025: Senate concurred.

This bill represents a significant step towards ensuring that automotive dealers in Massachusetts are fairly compensated for their labor, thereby enhancing the integrity of warranty service practices in the industry.

Compiled from official sources — confirm details with the bill’s official record.

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