The Quirky State Laws That Salespeople Must Know About
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Did you know that it’s illegal to make a sales call to the state of Louisiana on Mardi Gras Day, tomorrow? I hope you weren’t planning on making any sales calls that day and if so, apologies in advance for spoiling your fun.
Six-figure fines and settlements are not as fun as the French Quarter is on Mardi Gras.
When people think about sales, many picture salespeople hitting the links with clients or wining and dining them.
Sure, that all helps, but in reality, sales and telemarketing is one of the most complexly regulated industries -- not only on the federal level, but at the state level as well.
This means sales reps who hit the phones on a regular basis face loads of regulation and the risk of being violation of the Telephone Consumer Protection Act, which restricts telephone solicitations and the use of automated telephone equipment. The federal regulations serve as the baseline for all jurisdictions, and then state laws are added on top of that.
These laws have been responsible for some pretty hefty settlements, as was the case for Edward Jones and Co. in New Hampshire. Anyone using an outbound telephone call for consumer interaction is subject to these. Suits based on Telephone Consumer Protection Act went up by 30 percent last year through Sept. 30 (compared with a year earlier), according to a December report issued by the U.S. Chamber of Commerce's Institute for Legal Reform.
Since today’s workforce is increasingly mobile, location doesn’t inhibit sales activity, and more often than not, a company will have its sales reps calling all 50 states. This means companies need to be vigilant about being in compliance for all locations to which a call may be placed. There are numerous examples of little-known state laws that could get a company into serious trouble. Here are a few examples:
Maine requires a criminal background check to be conducted on each telemarketer before they are permitted to place any telephone calls to Maine residents.
Kentucky made it illegal to place a sales call before 10 a.m. and forgetting a time zone difference is not an excuse that will hold up.
State laws also make it far more difficult for sales organizations to maintain a consistent script across a dispersed sales force. For example, Illinois, Kentucky, Oregon and South Dakota require a rep to obtain permission from the consumer to continue before delivering a sales pitch.
Many states have specific disclosure requirements once a sale is completed on the call. For example, in Florida and Idaho, if a sale is made, the caller must provide the consumer with a state-issued license number.
If all of this makes your head spin, you’re not alone. The first step you can take is to audit your current compliance practices and procedures.
Tap into sales-intelligence data, too. If your system is tracking the number of calls your reps make to specific locations at certain times of day, you’ll be able to identify potential trouble spots. Engage a third-party compliance expert, if needed, so calling policies take into account all these regulations.
The bottom line is that ensuring compliance will only improve your overall sales performance. Negligence in this regard will not only bring you financial ruin, but it can also ruin your brand and credibility among customers present and future.
Instilling a culture of compliance in your organization from the top down will keep your company on the right track.
And come Mardi Gras, you won’t have to worry about ruining the party.