Let this restaurant’s $181,000 Pain be a Lesson to your small business.


Oklahoma Restaurant Served Big Complaint

Please read this accompanying link to get the full story

 


 

So, obviously you are thinking “well, we don’t do that sort of thing here at my business, we don’t have kids working and we pay our overtime properly” and that much may very well be true, but did you take a second to think about how this business owner found out the hard way how expensive ignorance of current labor concerns can be in this day and age?

In the article the owner states “I had no idea you are not allowed to do that. The little girl goes up to help momma clean the table and we can’t pay her” when confronted with the knowledge that their establishment was not abiding by child labor laws (that have been around for nearly a century now). The article states the owner is threatening bankruptcy to avoid the damages that are being leveled their way.

Now let’s dissect these seemingly innocuous grievances and then we will look at how simply all of this could have been avoided.

–          Children aged 10-17 were helping to bus tables, and not being paid for it

–          One child <18 years old was operating hazardous equipment (meat slicer)

–          Not properly paying employees overtime and having “volunteers” doing employee work (argued against, but not yet unsubstantiated)

Children in the workplace seems to be the rage in small towns and small/local businesses, I have personally seen small children of waitresses at cafes helping out at the end of a shift. While this seems to be so innocent, and a social argument could even be drawn that commends parents for helping their children to learn responsibility, in the business world it simply cannot exist no matter the intent.

This was a costly lesson for the business owner, racking up fines in the realm of $181,000 when coupled with the back-pay that they now owe to current as well as former employees for ignored payroll. And to think that all of this could have been avoided…easily.

To put it simply, and as is highlighted in this example, ignorance is not an excuse in the eyes of the law and no business owner knows everything (I get it, you know a lot, but that doesn’t mean you know everything). This being a local restaurant and one that we can assume could not afford to staff a full time HR professional, we can surmise that the owner assumed they either knew enough about employment law or “knew someone that did”. However, we must all admit that is just not enough in this day and age.

Business owners need to have someone that is well-versed in current HR policies and employment law on-hand to inspect and address these sorts of things.

How do we know this business did not have that sort of thing?

Easy: Any HR professional worth their salt would have seen this and immediately warned the owner against it.

 


Takeaway: Whether you think you need it or not, contact a HR professional to come in and do (at the very least) a personnel audit. For a reasonable sum you can buy the peace of mind knowing that you are following the rules and that all your T’s and I’s are properly completed.

A consultant will give you the information you need, and the fact that they are a third party will mean it will be seen as objective in a court of law.

I guarantee it will cheaper than either legal fees, if there was something you missed along the way.

 

Have questions? Contact me directly.

Jeff

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