Oregon House passes bill to fix law that forces state to refund child labor fines

By Kaylee Tornay (InvestigateWest)
Feb. 19, 2024 3:52 p.m.

State labor officials say bill would allow investigators to crack down on child labor violations

A file photo of Oregon Labor Commissioner Christina Stephenson from November 2022.

A file photo of Oregon Labor Commissioner Christina Stephenson from November 2022.

Jonathan Levinson / OPB

In 2020, a Ford dealership located in a suburb of Portland settled with the U.S. Department of Labor for nearly $28,000 over reported violations of federal child labor law.

THANKS TO OUR SPONSOR:

Federal investigators had learned that six workers, ages 16 and 17, were performing prohibited tasks as lot attendants at Landmark Ford in Tigard, including operating trash compactors. One teen was injured when he was thrown backwards into a tailgate while riding in the bed of a pickup truck.

State investigators with Oregon’s Bureau of Labor and Industries also scrutinized the dealership and levied a penalty for the company’s failure to obtain a required certificate to employ minors. But unlike federal investigators, the state bureau didn’t investigate any of the safety violations or issue fines for them. Because of the federal penalties, the state wouldn’t have been able to keep any of the money from a fine issued to the dealership. (The dealership did not respond to a voicemail from InvestigateWest seeking comment.)

The case is an example of a longstanding quirk in Oregon law that requires the agency to refund child labor penalties if an employer also faces federal penalties for the same violations. The restriction doesn’t apply to any other type of labor investigation besides child labor.

As a result, dozens of times over the last two decades, the bureau has declined to investigate employers who were also under federal investigation for child labor, state labor officials said.

They are now asking lawmakers to turn them loose. In testimony before the state Legislature’s House Business and Labor Committee in January, Labor Commissioner Christina Stephenson said the status quo gives bad actors a competitive edge and can in effect make the state a comparably attractive place to break the law.

“You might even come over to Oregon to do your violations if Oregon’s the one where you get half off on your penalties for child labor violations,” she said.

Oregon lawmakers may change that in this year’s legislative session. House Bill 4004, passed unanimously by the Oregon House on Feb. 14, would empower the labor bureau to both pursue and retain penalties that employers pay for child labor violations, even in cases when federal labor officials are also involved. The bill is now in the Senate.

Rep. Travis E. Nelson, D-Northeast Portland, said the proposed change “just makes sense.”

“Oregon should be able to fully and independently enforce our child labor laws,” he said.

‘Long overdue’ changes

The mandate to refund employers’ child labor penalties when they’ve also paid federal ones has been in place since the late ‘90s, though neither lawmakers nor labor officials can say why. The bureau’s request to change the law now comes amid greater national attention on child labor issues.

In her presentation to lawmakers, Stephenson cited what she described as “an explosion” of children being employed in dangerous, prohibited lines of work across the nation, as revealed in news coverage by the New York Times.

“It’s disproportionately migrant children and kids of color,” she said.

The Portland office of the U.S. Department of Labor and the Oregon Bureau of Labor and Industries communicate frequently about reports of illegal child labor in the state.

THANKS TO OUR SPONSOR:

In the last year alone, the state labor bureau referred 24 of the most serious cases of child labor to federal investigators, those involving reports of hazardous occupations and injuries, said Josh Nasbe, legislative director for the bureau.

Because it would have to refund employers for child labor violations, the labor bureau just doesn’t investigate when federal officials are involved. When they do investigate, it’s typically for less serious violations, such as employers failing to secure or update the certificate needed to employ minors, said Laura van Enckevort, administrator of the labor bureau’s wage and hour division.

In some of those instances, the agency may not levy penalties at all. About a quarter of cases in 2023 were resolved through a compliance agreement with the employer, which sets out the path to correct the violations.

If a business continues to violate the law after being penalized, the labor bureau may also rescind its certificate to employ minors, van Enckevort said.

Other states, such as California, have increased the penalties that employers can face for violating child labor law. But in Oregon, the maximum penalty hasn’t changed since 1981.

Nelson described his shock to learn that severe injury or death of a child doing prohibited work can only cost the employer up to $1,000. He introduced an amendment to the bill that would also raise the maximum penalty employers can face for egregious violations, including those that result in a child’s injury or death, to $10,000.

“These are kids that we are talking about,” he said. “I think that an increase is long overdue.”

Forward progress

The Bureau of Labor and Industries’ child labor unit currently consists of a single employee, leaving little capacity to take on a large influx of cases.

Its pursuit of greater enforcement capability on child labor comes as the agency deals with persistent backlogs in wage and civil rights claims and oversight of apprenticeship programs. The agency is requesting budget adjustments from lawmakers to help address some of those backlogs, but no new funding is included for child labor enforcement.

The agency won’t be adding staff, but van Enckevort said the change in the law would allow the department to conduct investigations more efficiently, because its actions wouldn’t hinge on what the federal Labor Department does. By keeping penalties, the agency can also recover the cost of its investigations. After the bureau is reimbursed, any additional funds would go to the Common School Fund, from which all of Oregon’s school districts receive money.

“If we’re pursuing an employer who is really egregious and violating the most serious child labor laws and holding them accountable, it’s going to have a ripple effect through all industries that employ minors,” van Enckevort said. “While I don’t think we’ll take every single case, I think there will still be some communication and balance between the two agencies on enforcement.”

The bill sailed through the House Business and Labor Committee and the full House with unanimous votes on Feb.12 and 14. The only representative to critique the bill voted for it anyway.

“Sometimes I think we just pass stuff that really is not something that’s necessarily needed, because we don’t necessarily have a problem,” said Rep. Virgle Osborne, R-Roseburg. “I just feel like this is one of those bills.”

The bill must move out of a Senate committee by Feb. 29 to stay alive.

Labor bureau officials said taking a more active role on child labor is important for it to uphold its mission to protect workers.

“The fundamental question the bill is asking is: Who should bear the cost of these investigations?” Nasbe said. “Should Oregon taxpayers bear the cost, or should the employer who has been adjudicated to have violated the child labor laws bear these costs? And we think that’s a very easy answer.”

InvestigateWest (invw.org) is an independent news nonprofit dedicated to investigative journalism in the Pacific Northwest. Reach reporter Kaylee Tornay at kaylee@invw.org.

THANKS TO OUR SPONSOR:
THANKS TO OUR SPONSOR:

Related Stories