Employment Law Blog Essay

What the Child Labor Crackdown is Missing

Supply chains across the United States are imbued with the labor of migrant children.  Migrant children produce the food we eat and the clothes we wear, working for household names like Cheerios and J. Crew.  They work in extremely hazardous conditions in factories, construction sites, and slaughterhouses.  Exhausted from this grueling work, some drop out of school.

So revealed a recent New York Times investigation by journalist Hannah Dreier, which has led legislators to call for increased penalties and even criminal liability for offending employers.  Solely punishing employers without benefiting the child victims, however, risks moving children from one exploitative working environment to the next.  Instead, legislators must address how a lack of legal work permitting pushes migrant children, even those above the working age who could work safe jobs under regulated hours, into the shadow economy.  Additionally, to allow working-age minors to find safe work, legislators must ensure they can access immediate financial support through unemployment insurance and workers’ compensation — without regard to their authorized work status.

Structural Causes for the “New Economy of Exploitation”

The causes for the exploitation of these migrant children’s labor are structural and multifold.  Over the past two years, 250,000 unaccompanied children, frequently from Central America, have entered the United States.  First, children are provided little support after entry.  The Department of Health and Human Services (HHS), which is responsible for placing these children with families in the United States, has reduced protections like background checks and offers little if any case management services.  In an illustrative secret recording, HHS Secretary Xavier Becerra derided staff for not processing children more efficiently: “If Henry Ford had seen this in his plants, he would have never become famous and rich.”

Second, migrant children feel pressure to work, as children often enter the country with plan to send remittances to their family.  Others are expected to contribute financially to the households they have been placed with in America.  Still others are pushed into labor as a result of human trafficking. Many of these children are not of legal working age.  Those who are, though, are eligible for work authorization, but often have difficulty navigating the permitting system on their own.  Thus, migrant children frequently obtain employment via fraudulent documentation, and as unauthorized migrant workers, they are already particularly vulnerable to poor labor conditions.

Coupled with a tight labor market, employers looking to child labor for “cheaper and more docile workers,” and some states attempting to loosen child labor laws, it comes as no surprise that these migrant children have become part of “a new economy of exploitation.”  As Dreier stated, “people often say that this is something that’s hiding in plain sight. But, I mean, it’s barely hiding. It is in plain sight.”

Penalties for Employers, but Little Remedies for Victims

The Fair Labor Standards Act (FLSA) regulates minimum age, maximum hours, and types of employment for those under the age of 18, and permits certain types of employment for minors; for example, children above the age of 14 can typically work nonagricultural jobs outside of school hours.  Thus, while some migrant children Dreier interviewed were as young as 12 or 13, others above the age of 14 are able to legally work certain jobs.  However, under FLSA § 212(c), minors cannot be employed in “oppressive child labor” conditions, a flexible standard defined under § 203(l) as conditions that are “particularly hazardous for the employment of children [of certain ages] or detrimental to their health or well-being.”  For example, regulations bar minors of any age from most meat-slaughtering and -packing work, which can cause serious injury and death.

The Department of Labor (DOL) has two main tools to combat child labor violations.  First, under § 216(e)(1)(A), violations of the FLSA are subject to civil penalties of approximately $15,000 per employee in violation or approximately $130,000 per violation that causes a child’s “death or serious injury” (both inflation adjusted).  Importantly, these civil penalties are not paid to the children employed in violation of the Act but rather “deposited in the general fund of the Treasury.”  Second, under § 212(a), goods produced in violation of child labor laws within the past thirty days can be subject to seizure.  Known as the “hot goods” provision, § 212(a) empowers the DOL to seek an injunction from a district court.  It is among the FLSA’s most forceful tools and has previously been used to seize goods in the garment and agricultural industries.  While employees may bring suit to recover wage and hour violations under the FLSA, no such private cause of action is available for victims of child labor violations.  Thus, under the FLSA, the only “remedy” for victims is removal from illegal employment.

The Department of Labor plans to leverage these civil penalties and hot goods enforcement powers against offending suppliers and corporations, and Congresspeople have called on HHS to explain and audit its child placement process.  While critics have rightly lambasted the FLSA’s provisions as woefully insufficient, calls for increasing civil penalties or even levying criminal charges against employers zero in on the wrong problem.

Ensuring Unauthorized Workers’ Access to Public Programs

A child removed from one dangerous job is likely to try to find another job — and without interim financial support, that job is likely to also be in the shadow economy.  To locate safe, legal employment, children of working age need immediate access to financial support and legal work permits.  Rather than focusing solely on ex post punitive measures against employers, legislators must guarantee that unauthorized workers have access to programs like unemployment insurance for interim income assistance and workers’ compensation for workplace injuries.  For migrant children of legal working age, lack of work permit documentation both limits access to public programs and ultimately contributes to unsafe and oppressive child labor.

Whether people who lack proper work documentation can access the safety nets of workers’ compensation and unemployment insurance, which are regimes based in state law, is a complex question made more complex by Supreme Court precedent.  In Hoffman Plastic Compounds, Inc. v. NLRB, the Court held that the Immigration Reform and Control Act (IRCA), which makes employment of “unauthorized alien[s]” unlawful, prohibited awarding back pay to an undocumented worker fired in violation of the National Labor Relations Act.  The Court’s expansive reading of federal immigration law was troubling and immediately caused panic that the IRCA would similarly preempt access to remedies under the FLSA, Title VII of the Civil Rights Act, and state safety net regimes.

In the wake of Hoffman and the IRCA, unauthorized workers almost uniformly lack access to unemployment insurance, despite oftentimes paying into the system.  This is because workers must demonstrate that they are “able and available” for future work — something a worker cannot show if they lack proper work authorization and documentation.  Unemployment insurance is critical for children over the age of 14, who can legally work in certain circumstances, to receive the interim financial support necessary to seek out safer employment.  Beyond harm to the child, lack of access to unemployment insurance also presents a moral hazard for employers, who can freely terminate unauthorized workers without risking increases to their insurance costs.

On a more encouraging note, most state courts have held that despite Hoffman, undocumented workers have access to workers’ compensation, which typically provides access to medical benefits for covered injuries and at least partial lost wages.  For example, the Supreme Court of Kentucky held that “a fifteen-year-old unauthorized alien” had access to workers’ compensation under state law, finding no conflict between federal policy aimed at deterring the hiring of unauthorized workers and state policy providing financial support for employees injured in workplace accidents.  But the specifics vary.  For example, under Michigan law, minors typically have access to double disability compensation, but minors who use fraudulent documentation are limited to single compensation.  Additionally, for negligence or wrongful death suits seeking damages beyond the scope of workers’ compensation, some courts have found that permitting lost wages would be “akin to compensating an employee for work to be performed” and would therefore conflict with the IRCA in cases of unauthorized workers. Some state legislators, too, have advanced bills attempting to limit access to workers’ compensation for unauthorized workers.

Immigration status is thus critical to understanding the exploitation of migrant children’s labor both practically, as a doubly vulnerable population, and legally, in how work status impacts the availability of compensation for injuries and interim unemployment.  Legislators and executive agencies across federal and state governments have a host of potential avenues to assist working-age children financially, from providing access to unemployment insurance and workers’ compensation, to easing the federal procedure for granting work permits.  Focusing only on punishing abusive employers not only fails to provide children with immediate support but is also unlikely to stop unsafe child labor.