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July 14, 2010

Fast food outlets fined often for child-labor violation

Fast-food places such as McDonald's are busted fairly frequently for making kids work overtime without adequate pay, too long on school days or to perform prohibited tasks. In today's paper Mary Gail Hare writes of a Phoenix McDonald's dinged for more than $30,000 in penalty and back wages. A Pittsburgh McDonald's franchisee had to pay $36,609 in back wages in January. You can browse and search the new releases on wage and hour violations here.

Franchisees are getting squeezed these days by the "dollar menus" promoted by the parent chains. In a poor economy dollar menus are really popular. Look at McDonald's stock. Chains love dollar menus because they get paid a royalty as a percentage of sales; they make money whether the franchisee does or not. But dollar items often cost the franchisees more than a dollar to make and sell. So the temptation to take advantage of teens by making them work off the clock is even greater.

What's puzzling is why the penalties imposed by the Labor Department are so low. When employers abuse employees they're seem to be risking only the money they would have owed anyway plus a small fine.

Speaking of child labor, check out the New York Times report on Philip Morris allegedly benefiting from child-labor abuse on tobacco farms in Kazakhstan.

UPDATAE: Altria spokesman Bill Phelps writes:

You mentioned "Philip Morris" after writing about a number of U.S. fast food companies. The company about which the New York Times wrote today is Philip Morris International, a company that manufactures and sells cigarettes outside of the U.S. I was hoping you'd consider updating your post to include the full name of the company to clarify this is not Philip Morris USA, which sells cigarettes in the United States. These are two entirely separate companies.
Posted by Jay Hancock at 9:19 AM | | Comments (2)
        

Comments

That place has been doing it forever. I used the fryers all the time when i worked there when I was in HS. I had no idea that was illegal. I can't remember if I ever had the problem with the hours. I don't think so as I was fairly cognizant of that.

'What's puzzling is why the penalties imposed by the Labor Department are so low. "

That is the Labor standard. Anyone who thinks unions have ruined the US need to look at the egregious abuses of business. The penalties are so low because of the lack of political willpower to equip the Labor department with regulations and advocates who truly protect workers instead of enable business unrestricted access to cheap labor. This is why unions take such aggressive positions. They have no other guarantees or protections. The NLRB is rife with anti-labor/pro business goons, much the same as other government agencies have been corrupted.

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About Jay Hancock
Jay Hancock has been a financial columnist for The Baltimore Sun since 2001. He has also been The Baltimore Sun's diplomatic correspondent in Washington and its chief economics writer. Before moving to Baltimore in 1994 he worked for The Virginian-Pilot of Norfolk and The Daily Press of Newport News.

His columns appear Tuesdays and Sundays.
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