A federal judge yesterday struck down the Labor Department's main enforcement tool against violations of child labor laws, declaring the provision to be unconstitutional.
The ruling by U.S. District Court Judge Oliver Gasch came in a suit filed by Jerrico Inc., which operates 40 Jerry's restaurants in Kentucky, Indiana, Tennessee, Georgia and Florida. Using a 1974 provision of the Fair Labor Standards Act, a Department of Labor official fined the company $103,000 in civil penalties in 1975 for improper employment of minors. An administrative law judge reduced the penalty to $18,500 in 1977.
The company sued, claiming that, by allowing the Labor Department to keep the money it collected in fines in order to pay the costs of investigations, the law was an unconstitutional violation of due process.
Gasch ruled that the civil fine provision constituted an "indisputably impermissible biasing influence." He suggested that "the more appropriate procedure is simple and constitutionally sound: pay all civil money penalty funds directly into the Treasury of the United States."
According to Ronald Whiting, associate solicitor for the Labor Department, the law still can be enforced by obtaining an injuction from a federal court, the method used prior to 1974. Whiting said there was a "good chance" that Gasch's ruling would be appealed, but that the Labor and Justice departments must consult before a decision could be reached.