An excerpt from the Warranty Instruction & Reference Manual - GM Edition

We often find legitimate allowances are not claimed when available.  In the Spring of 2002, GM actually removed references to most administrative allowances (Policy "S") from the GM Labor Time Guide (LTG), but slowly replaced them with a Coverage Code "S1" & "S2" designation.

Under the heading “Administrative Allowance” in the GM Service Policies and Procedures Manual (Article 1.5.10, item a) it states: “. . . the following items are eligible for a 0.2 hour administrative allowance in conjunction with warranty repair/exchange through an AC Delco Service Center, or sublet to other qualified service facilities”:

The section goes on to say certain “items are eligible for 0.3 hours additional administrative allowance (for a total of 0.5) only when repairs are completed at a sublet location and Dealer provided for the movement of Vehicle to and from that location.” These items include:

All claims for this additional allowance require initials of the employee authorizing vehicle movement on the related job line.

When coding these labor operations, the LTG used to read: “Policy S,” or “Policy S- an additional 0.3 hours if vehicle delivered to and from repair location.”  This provision is still applicable, however the reference to Policy "S" was temporarily removed from the LTG and reinstated as "Coverage S1, or S2."  With WINS claims processing this additional time is placed in the “regular labor hours” column

Customer Reimbursement claims are due a 0.2 hr. administrative allowance.  Allowances for customer reimbursement claims may not be evident since you use the related labor operation.

Second (and this one may be considered hidden) under Article 1.5.12, item e, it states: “Dealer reimbursement for tires replaced under vehicle warranty will be at Dealer net cost of tires and any mounting, balancing and freight charges not covered by the tire manufacturer, plus a 0.2 hour handling allowance on each tire replacement RO” (once per RO). This procedure is to be used when replacing tires that failed as a result of a defect of another warranted component.

Many dealers remain unaware of the allowance for recycled air conditioning refrigerant. When replacing an air conditioning component because it was leaking, Technicians will usually have refrigerant billed on the repair order. However, the Dealer is also due reimbursement for recycled refrigerant when replacing a noisy (not leaking) compressor for example.

This reimbursement is at Dealer cost for GM refrigerant plus the appropriate parts handling allowance. No parts mark-up allowance is appropriate if you are using non-GM refrigerant (it is easy for an auditor to determine which type is used).

Refrigerant replaced due to a leak in the system should be submitted in the “parts” section of the claim (GM type only) with appropriate mark-up. All recycled refrigerant, as well as non-GM type should be submitted in the “net amount” column. You may claim the parts mark-up in “net amount,” applicable to the year model, only when using GM type refrigerant. Non-GM refrigerant must be sold at cost!

Since refrigerant is seldom issued over the counter these days, it is important that your technicians and warranty claims administrator are familiar with these procedures. All repairs to the A/C system that require recover/recharge of refrigerant should have freon billed to the repair order. Current systems (R134a) hold approximately two pounds of refrigerant (rear air units require more) and anything in excess of three pounds (including one for leak test) may cause the claim to reject for excessive parts/net amount.

If you may be using recycled coolant, a similar procedure applies. Reimbursement for recycled coolant and refrigerant is covered under Article 1.5.17 of the P&P. It is GM’s intent to provide a means of encouraging the use of recycled coolant and refrigerant when possible. Only coolant and refrigerant recycled by GM-approved Dealer equipment is permitted.

Many dealerships overlook their ability to claim a handling allowance for parts supplied from GM Divisions at “no charge” to the Dealer. Article 1.5.2, item f of the P&P addresses this provision. Current procedure for claiming this allowance is to bill the part number on the repair order and the mark-up only should be entered as the sale price.

For parts with no published part number or price, Dealers should contact GMSPO. While GM may only provide an engine or transmission occasionally under this arrangement, the handling allowance is usually sizable and should be claimed when appropriate.

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