March 5, 2023 ✦ OnLabor

In today’s news and commentary, a new Washington Post report highlights the impact of child labor investigations on the children involved; the Department of Commerce imposes childcare requirements on companies seeking microchip subsidies; a New York City Starbucks worker is reinstated after being fired without cause; and the NLRB rules that Google is the employer of subcontractors hired through a staffing agency.

We continue to learn about the fallout from the Department of Labor’s investigation into child labor violations by Packers Sanitation Services Inc. On Friday, the Washington Post reported on the impacts the investigation has had on the children in one Nebraska town. After the DOL raided the meatpacking plant, some children employed at the plant skipped school for several days; others dropped out of school; and two fled the town entirely. Many of the children that PSSI employed are migrants, and one school employee concluded that “when the authorities came, the kids thought they would be taken away or deported.” The children’s families face their own consequences; the Post highlighted one girl whose mother pled guilty to child abuse for allowing the girl to work at PSSI, and whose stepfather faces deportation after pleading guilty to a misdemeanor for driving her to work at the slaughterhouse.

David Weil, a professor at Brandeis University and the former head of DOL’s Wage and Hour Division, explained some of the causes of the recent surge in child labor violations. Brand-name companies like Tyson Foods or Hyundai have increasingly subcontracted parts of their operations to outside companies like PSSI, which outsource their own hiring to staffing agencies. That fissuring decreases the incentives for the brand-name companies to ensure compliance with labor and employment laws and makes it more complex and costly for regulators to investigate potential violations. Unaccompanied minors are particularly vulnerable. After they arrive in the United States, the Department of Health and Human Services sends them to live with sponsors and, although the sponsors are supposed to be vetted, HHS has been failing to perform adequate vetting. The sponsors then often pressure the children to take jobs and Professor Weil argued that HHS should increase its support for the sponsors to ensure those sponsors have the resources to provide adequate care. Professor Weil also argued that DOL needs more funding to crack down on child labor violations and the authority to impose more severe penalties on companies that violate these laws.

Last year, the federal government passed the CHIPS Act, which included $39 billion in subsidies for the construction of semiconductor factories in the United States. The Department of Commerce announced last week that companies hoping to take advantage of those subsidies to build new plants would have to develop a plan guaranteeing affordable childcare for the workers building and operating those plants. Companies can choose how to meet that requirement, including by building new childcare facilities, paying local providers, or paying employees directly to offset their care costs. As the New York Times reports, employers have raised concerns that a shortage of affordable childcare has blocked potential workers from entering the labor market, and the Department explained that the childcare requirement is “essential to getting people—especially women—into the workforce.”

In 2021, New York City passed a law giving fast-food workers just-cause employment protections. Fast-food employers must now give a valid reason for firing their employees, and if the City finds that a given employee has been fired without a good reason, the City can order reinstatement. Last week, Austin Locke became the first worker to be reinstated under the 2021 law. Mr. Locke was fired in July 2022 from his position at a New York City Starbucks, five days after his workplace voted to unionize. He filed a complaint with the City Department of Consumer and Worker Protection, and the Department reached a settlement with Starbucks in late February. The settlement includes reinstatement, back pay and damages of roughly $17,000 for Mr. Locke, and $3,500 in civil penalties. Mr. Locke had also filed an unfair labor practice complaint with the National Labor Relations Board, arguing that he was fired for his union activity; as part of the settlement, he dropped his charge.

Finally, a regional director of the National Labor Relations Board ruled on Friday that Google is the employer of YouTube subcontractors hired via a staffing agency. Google’s business model reportedly relies on staffing firms to meet its labor needs; the case in question involves 60 workers hired through Cognizant Technology Solutions Corp., a national staffing firm. The NLRB ruled that Google is a joint employer of the workers because it “exercises direct and immediate control over benefits, hours of work, supervision and direction of work.” Alphabet Workers Union, an affiliate of the Communications Workers of America, has been seeking since last October to represent the workers; the workers have been on strike since last month over workplace issues.