Child labor laws: steering clear of costly youth labor violations.

When investigators from the U.S. Department of Labor (DOL) office in western New York first paid a visit to Lockport Town and Country Club, general manager Enrique Jimenez had no idea that he would be handed a fine of close to $19,000. The penalty--to be paid in full to the DOL--was the result of child labor and overtime violations extending back over a period of three years, on employees who no longer worked at the club. Some of them had even been fired. Still, the DOL had the right to interview those employees after the fact, and, after a thorough review of Lockport's labor and employment records, levy a civil money penalty against the club.

"People in the industry need to understand what a tremendous problem this is," Jimenez said. "This is really something that club board members and management need to pay attention to. Everyone needs to read and understand these laws, because this is no exaggeration--you can lose your job over this."

Stories like Jimenez's have become more common in the last year as the DOL has stepped up its vigilance in investigating private clubs for violations, particularly in the Eastern United States. Only a month before DOL investigators showed up at Lockport, a 15-year old was found operating a chainsaw at a golf club elsewhere in New York State. Then, on January 8 of this year, CMAA received a call from the Long Island district office of the DOL's Wage and Hour Division to let them know that they will audit 10 clubs through September. They didn't say which clubs those would be, but stated that it would likely be clubs located on the eastern end of Long Island. Furthermore, a broader investigation of the industry will likely take place across the entire country within the next two years.

That said, the threat of investigation of your club, along with the potential for facing a staggering fine, is quite real. For instance, according to the DOL rules, a violator of the child labor provisions may be subject to a civil money penalty of up to $11,000 for each minor employed in violation (with $1,000 as the minimum). Multiply that number by several different employees engaged in identical violations, and you could be looking at a total fine that could easily reach into the tens of thousands of dollars. According to Jimenez, at least two other clubs in his area of western New York have garnered fines in excess of $60,000.

"A fine of this magnitude could really hurt a smaller-sized club," Jimenez said, "And the worse thing about this is that literally everyone is violating the rules, because it's so easy to do. This used to be stuff you would never even think about." If a club allows a 16year old caddy drive to drive a golf car, for instance, just one time, the DOL could hand down a judgment against you for $2,500. "This stuff is big," he added.

Know the Law

According to the DOL, however, money is not the main issue in child labor investigations. In order to avoid the nightmare scenario described above, it's important for clubs to know how to comply with the laws as they're written.

"Our main objective is not to go around and hand out fines," explained Mark Price, compliance specialist in the Northeast Regional Office of the DOL's Wage and Hour Division, "we want to get clubs into compliance. If we can get clubs in compliance with the laws--and they don't have to pay civil money penalties--then it's a win-win situation for all of us."

According to Price, the two broad areas of regulation that the DOL looks at are restrictions on hours and type of work for 14-15 year olds, and hazardous occupation restrictions for those under the age of 18. In Jimenez's experience, the investigator also took a look at whether employees were paid tips in relation to their overtime hours. They weren't; so $4,500 of his overall fine went toward the retroactive pay of these overtime tips. "Everyone found a problem with their overtime tips at the clubs in western New York," Jimenez said.

The restrictions on the number of hours that minors can work breaks down in the following manner. Fourteen and 15-year olds may way work up to, but not exceed:

* 3 hours on a school day;

* 18 hours in a school week;

* 8 hours on a non-school day; and

* 40 hours in a non-school week.

In addition, the work performed must be between the hours of 7 a.m. and 7 p.m., except from June 1 through Labor Day, during which time the evening hours are extended until 9 p.m. For 16- and 17-year olds, it is important to note that there are no federal restrictions on the type and number of hours worked; however, state regulations often enforce rules for this category of workers as well. The discrepancy between state and federal rules also adds another layer of confusion to the already ambiguous stew of laws and guidelines.

In Jimenez's case, the original $19,000 fine came from investigators out of the district office. Once the matter was sent to Washington, the federal government wanted to tack on an additional penalty--about $13,000 worth. This brought his total fine to nearly $32,000.

"Assessing a fine is really the last step in this whole process," Price emphasized. "We want to do everything we can to get the club in line with the regulations." With that, Price detailed the steps taken during an investigation that uncovers a violation:

1. Get the club into compliance. In cases where the violation is not serious, or the imfraction is limited in scope, the DOL will suggest some steps and provide information on how to quickly remedy the situation.

2. Assess an initial civil money penalty. The investigator will tell the employer that it will be officially considered for a monetary fine.

3. District director reviews case. The district director of the regional office of the DOL will receive the paperwork on the employer and evaluate the situation and the imfractions.

4. Employer receives explanatory letter from DOL. The district director composes an official letter for the employer listing the specific violations, dates the violations occured, and the names of the minors involved in the investigation. With this letter, a civil money penalty is announced.

5. Opportunity to appeal. Should the employer choose to dispute the decision, they have the right to take the case before an administrative law judge.

Point number five, however, comes with a caveat from Jimenez. "I would definitely warn clubs not to fight the DOL in court," he said. For one of the clubs that was originally fined $64,000, "they then had to pay an extra $10,000 in legal fees after they lost the case." And, as an extra headache, if the full amount of the fine is not paid on schedule, a penalty of five percent--that is, five percent of the original total--is added on for each 15 days that it is late.

Compliance Education

Jimenez added, though, that the DOL does ultimately try to work with everyone they investigate. By agreeing to work with the local office of the DOL in promoting compliance, he was able to greatly reduce the amount of his fine. Ironically, it is the very fact that the DOL has been awarding so many fines that has made them realize that they haven't been doing their job as well as they should.

"In the last two years of the present administration, there has been a greater push toward education," Price said. "For example, our YouthRules! campaign is a fairly new program created under Secretary of Labor Elaine Chao. It is an umbrella program under which all of the child labor laws are addressed."

Through YouthRules!, the DOL has joined with its "strategic partners" in order to promote understanding of the labor laws at the state and federal level. At the CMAA Convention held in Miami, Mark Price announced that CMAA had become a strategic partner with the YouthRules! program. The easiest way for employers to learn more about the program is to visit the YouthRules! website at http://youthrules.dol.gov.

"We're brainstorming as many ideas as we can in order to find out a way to promote this program," Price explained. "At the local level, we've held meetings where we meet with high school newspaper reporters. They ask us questions, and they write up stories about the YouthRules! program." Price added that the DOL can provide speakers for any CMAA Chapter function.

On the YouthRules! site, users can download the DOL's "Employer's Pocket Guide on Youth Employment"--a electronic version of the pamphlet the department provides on the general information pertaining to child labor restrictions. Other useful features include fact sheets that list in greater detail the exact types of work that may land an employer in hot water, along with a selection of downloadable stickers than can be posted in the workplace. Though not currently listed on the site, there are plans to break down the various regulations on a state-by-state basis.

Labor Posters

As a result of his experience of being audited by the DOL, Enrique Jimenez decided to put some of his graphics knowledge to use in creating a series of informational posters designed to help clarify child labor laws in the workplace. Working with the assistant secretary of the DOL in New York, Jimenez was able to incorporate elements of the various laws in a full-color, visual representation. Furthermore, the three posters are divided into the club-specific areas of golf, kitchen, and grounds--designed to be posted in the appropriate work areas of the club.

"I made the graphics so that even if a person doesn't speak English, they can look at the poster and get the point," Jimenez said. "This makes it a lot easier for supervisers to train their staff, which in itself is an important way to reduce the number of violations."

The kitchen area is the number one source of violations during an investigation. The usual culprits: underage workers operating meat and bread slicers, working with power mixers, unloading trucks--or even something as banal as cleaning out the inside of a freezer. Jimenez told of a situation at a club in Boston two years ago where a worker--no longer employed there--sliced his finger open on a meat slicer, and later told a DOL investigator about what happened. That incident ended up costing the club $35,000, due in large part to the fact that the employee said he used the meat slicer on numerous occasions.

"Once kids are missing time for an injury suffered on the job, then you are starting to talk about more serious penalties," Price noted.

After at least six consultations with the local district office of the DOL, and subsequent revisions, Jimenez finally obtained official endorsement for the posters from the DOL. He introduced them at this year's Idea Fair at the CMAA Conference, and now, he says, "the posters are up at over 200 clubs around the country." For those that wish to order one or all of the posters, CMAA provides a link on their password-protected site at http://www.cmaa.org/legislat/childlabor.asp with a printable order form.

"We really liked the posters in that they were designed to communicate different areas of compliance," Price said.

Finding Solutions

Though the problem of youth labor compliance is still a predicament for many clubs, it's clear that there are resources now available that can help resolve some of these issues before a DOL investigator shows up at your door. CMAA's partnership with the YouthRules! campaign is one major stride toward raising awareness. However, it is still ultimately left to those in management to assume the responsibility of learning the regulations--inside and out.

"Instead of sticking our heads in the sand and being fearful that the government is going to issue fines, it's important to see this as a real positive thing," Price said. "After all, the point of all of this is to protect the safety of young workers."