Commentary

Using tech to protect your brand from violating child labor laws

When it comes to managing minors, the risk of being out of compliance with labor laws are more substantial than other industries.

June 8, 2017 by David Cantu — VP Business Development, HotSchedules

Before taking on the restaurant software business, I worked in and managed many restaurants, so I've had my fair share of experiences managing younger employees. And it's not always easy. Between the onboarding and training, the teaching, the course-correcting, and sometimes the disciplinary action, this industry can teach you a lot about patience.

It also teaches managers a thing or two about compliance. The restaurant industry employs a disproportionate number of youths. Between 2010 and 2012, for instance, 30 percent of fast food workers were 16 to 19 years old.

When it comes to managing minors, the risk of being out of compliance with labor laws are more substantial than other industries.

Minor labor laws

Child labor laws fall under the Fair Labor Standards Act (FLSA), an 83-year-old bill enforced by the U.S. Department of Labor. They are in place for good reason. According to the National Institute for Occupational Safety, about 160,000 American children suffer occupational injuries every year, and as many as 54,800 of these injuries warrant emergency care.

The penalties are steep for a restaurant or food and beverage operation in violation of these laws. Child labor violations that cause the death or serious injury of any minors (i.e. anyone under 18) can result in up to a $100,000 civil penalty if the violation is determined to be "willful or repeated." That cost doesn't factor in criminal charges, lawyers' fees, and the damage to a restaurant's reputation. In other words, a work accident involving minors could be detrimental to your business.

Violations still occur, penalties are incurred

For restaurant managers, scheduling and managing minors is only one aspect of complying with the FLSA. The state child labor laws are a separate issue, as each state can have legislation that is more (or less) stringent than federal law.

Restaurants go foul of the FLSA all the time. In my company's headquarters, Austin, Texas, the Department of Labor found FLSA violations in 95 percent of restaurants it investigated between October 1, 2015, and June 30, 2016. The investigators secured more than $330,000 in back wages for 500 restaurant workers. The charges ranged from minimum wage and overtime violations to child labor violations such as allowing minors "to operate and clean hazardous equipment."

It's a tightrope walk

The variety of child labor violations is immense, and the odds of error are particularly high and expensive. You're walking a legal tightrope.

Just consider the most basic FLSA regulations regarding minors 14 to 15 years old. Any restaurant or food business with gross sales totaling $500,000 or more has to:

Pay no less than $4.25 per hour within the first 90 consecutive days of employment
Limit work to three hours on school days / 18 hours per school week
Limit work to eight hours on non-school days / 40 hours per non-school week
Not start minors before 7 a.m. or after 7 p.m. except between June 1 and Labor Day, when the latter time is extended to 9 p.m.

The laws get extremely particular — and vague. For example, 14 and 15-year-olds can't bake at all or operate any power-driven bakery machines including dough mixers, rollers, and pounders. They can't work in a freezer either, but they "may occasionally enter a freezer momentarily to retrieve items."

However, 16- or 17-year-olds can use some power-driven baking machines if they are comparable to home use models. And they may operate pizza dough rollers that have specific safety features (e.g. no exposed gears), as long as they don't set them up themselves. No minors whatsoever may use power-driven meat processing machines or wash the disassembled parts of such a device.

So you're managing time, school schedules, age groups, and nitpicky equipment use rules, among other things. It's not to say the rules are unfair or unneeded. They're just tricky.

Guardrails with technology

Given the complexity of child labor laws and the likelihood of mistakes, I recommend automating as much of compliance as possible. It's not that your managers aren't capable of scheduling or hiring around these rules. The question is whether they should be spending an exponential amount of their time worrying about whether or not they are complying.

Automation is the key, and I can tell you first hand that technology makes managing minors a heck of lot easier for your managers.

The goal is to get the rules right and then set it and forget it. Effectively, you're creating ‘guardrails' that keep your managers from taking a multimillion dollar step over the edge. At a minimum, you need the following:

Documentation. You need to document and track the scheduling and time and attendance data from every shift. In the event you get investigated, this documentation can help prove that you didn't violate child labor laws. Such recordkeeping is legally required, but many restaurants fail to do it because they rely too heavily on spreadsheets and paper. Every schedule and shift should be recorded, stored, and backed up in the cloud.
Minor labor rules and thresholds. Add minor labor rules to your scheduling system so you can't inadvertently break laws. Set max hours per shift and week for minors. Program strict clock-in and clock-out times. The manager should trigger an alert or warning when attempting to schedule anything that violates the law. I can't give specific numbers in this section because they will vary from state to state. Remember: the FLSA rules are the bare minimum.
School calendars.In your scheduling and labor management system, you should be able to input local school calendars so you can adhere to school days, vacations, etc. You need district-by-district data, and you need to know which employees attend which schools. Your system should alert you when, for instance, you try to schedule a 15-year-old for 30 hours during a week you mistook for spring break. Equally important, ask minors to input off-calendar commitments like finals week, sports team travel, and other conflicts that won't necessarily show up on school calendars.

If compliance hasn't been on your radar, start with the Department of Labor's YouthRules restaurant self-assessment. And in the long-term, program technology to do the hard work of compliance for you. That is the surest way to avoid lawsuits while still hiring and developing the young talent you need to run a successful restaurant.