Follow-up review. Child Labor Inspection Program, Georgia Department of Labor

FOLLOW-UP REVIEW

Child Labor Inspection Program Georgia Department of Labor

January 2004

Russell W. Hinton, State Auditor Performance Audit Operations Division Department of Audits and Accounts

254 Washington St, SW Atlanta, GA 30334

This is a Follow-up Review of the Child Labor Inspection Program of the Georgia Department of Labor. The Department of Audits and Accounts released a Performance Audit on the Program in February 2001. This Follow-up Review was conducted to determine the extent to which the Program has addressed the recommendations presented in the report. A copy of the original report can be obtained through the contact information on the back of this Review.
Background on the Child Labor Inspection Program

The purpose of the Child Labor Inspection Program is to promote the safety and well being of Georgia's working youth. The Program is responsible for reviewing the employment certificates (work permits) required of minors under the age of 18, enforcing the provisions of the state's child labor law, and for reporting violations of the federal child labor law (the Fair Labor Standards Act). The Program also distributes child labor information to new businesses and conducts employer information seminars upon request.

All Georgia businesses are subject to state law. In addition, companies that are engaged in interstate commerce and have annual sales of at least $500,000 are also subject to the federal Fair Labor Standards Act. In those cases in which a company is subject to both state and federal law, the more restrictive law takes precedence. The Fair Labor Standards Act is enforced by the Wage and Hour Division of the U.S. Department of Labor (USDOL) and provides for civil fines and criminal penalties. Both state and federal law include restrictions regarding the minimum employment age, the number of hours and times of day that minors may work, and the types of jobs they may legally hold. State law requires that any minor under the age of 18 obtain a work permit to be employed. Work permits are normally issued by a school official, such as the superintendent or principal.

Synopsis of the Audit Recommendations

Our 2001 Performance Audit of the Child Labor Inspection Program found that the Program was not conducting its operations in a manner that fulfilled its overall purpose of protecting the safety and well-being of Georgia's working youth. For example, problems identified during our review of work permits had not been identified by the Program or followed up on, procedures in place provided opportunities for employers to circumvent the law, inspections were announced, and complaints were not followed up on in a thorough and timely manner. In addition, the lack of enforcement power granted to the Program by the General Assembly weakened its ability to fulfill its mission.

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At the time of the Performance Audit, the Program was unable to clearly identify objectives that linked its operations to its performance or effectiveness. The 2001 report recommended that the Program develop internal performance goals and objectives relevant to its overall mission, automate the system of work permits and complaints, and improve its complaint handling process. The audit also recommended that the General Assembly give consideration to eliminating the permanent identification card for 16- and 17-year olds and to modifying Georgia law to provide a level of protection similar to that provided by federal law.
Status of the Audit Recommendations
The Child Labor Inspection Program has implemented measures to address all of the recommendations cited in the 2001 Performance Audit. However, additional steps are needed to ensure the safety of Georgia's working youth. For example, the Program has issued revised work permits requesting additional information designed to better protect the minor; however, staff noted that they cannot require the minor, the parents, nor the employer to complete the information because it is not specifically prescribed by law. The Program also has plans for a web-based work permit program that will allow for greater monitoring and statistical reporting capabilities. Although continued efforts are needed to fully address all of the audit recommendations, the Program should be commended for its efforts over the past two years. Specific steps taken regarding each finding are discussed below.
Recommendation in 2001: Action should be taken to develop a Child Labor Program that more effectively addresses its overall purpose of protecting the safety and well-being of Georgia's working youth.
Current Status: The 2001 Performance Audit examined four major issues regarding the overall effectiveness of the Program. The Program has addressed each of these issues as follows:
As reported in 2001, the work permit did not require parental notification nor did it take into account how the youth's employment could impact his or her academic achievement. There is still no requirement in the law for parental permission of the work permit. However, House Bill 13 was introduced during the 2003 legislative session and it adds this provision. As of the date of this Follow-up Review, the bill is still pending. The work permit also lacked specific information about the minor's work hours. Since the Audit, the Program has revised its work permit to include a blank for the employer to specify the number of hours the minor would be working on school and non-school days and the minor's actual beginning and ending work hours each day.
The Audit found that the Program had only limited enforcement power and could not levy fines and penalties which made the work permit program, in effect, voluntary. Program staff indicated that since most Georgia businesses must comply with federal child labor laws which take precedence over state laws, it allows the USDOL to handle the civil and monetary penalties. The report also found that the Program was not making efforts to follow-up on cases it had referred to the USDOL. Since the Audit, the Program has developed a monthly status report to track the status of cases it refers to the USDOL.
At the time of the Audit, the Program was conducting announced inspections in response to formal complaints. In addition, the Program was providing employers with blank work permits

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which could have made it easier for them to circumvent the law. Program staff report that all child labor inspections are now unannounced and no employment information is requested of the employer in advance of any child labor inspection. In addition, the Program has discontinued its practice of providing blank work permits to employers.
The Audit also revealed that because of a legislative provision allowing for minors aged 16 and 17 to obtain a permanent identification card, any protection afforded to the minor regarding hours, job duties, or safety, could be circumvented. The Program has not initiated any changes to this part of the statute and believes that it is enforcing the law by providing cards to the respective age group as the law specifies. Program staff indicated that they periodically conduct unannounced inspections for hazardous work duty assignments for this age group to ensure they are not employed in jobs considered to be dangerous to their health and well-being.
Recommendation in 2001: Action should be taken to develop quantifiable objectives that more accurately measure the Program's overall effectiveness.
Current Status: At the time of the Audit, the Program's formal objective was to reduce the number of inspections that revealed child labor violations. Because most of the Program's inspections originated from the review of work permits and complaints rather than random on-site reviews of employers' child labor practices, the audit found that this objective did not provide an accurate measure of the Program's effectiveness. The Program's new formal objective, which is to reduce the number of violations found during initial audits that remain upon re-inspections, presents the same concerns with measuring the Program's effectiveness since work permits and complaints still provide the impetus for inspections. Program staff indicated that they plan to begin working with employers and the Worker's Compensation Board to obtain statistical data identifying those industries with the highest concentration of minors being injured and will use this information for targeting their inspections. Staff also stated that they are continually working toward finding measures against which to evaluate the Program's performance.
In its response, the Department stated that it has developed a new database in conjunction with the Georgia Board of Workers Compensation that reports injuries of youth, and that it now conducts child labor investigations based on these reports. The Department also stated that it has increased its educational efforts targeted to employers, minors, and school systems.
Recommendation in 2001: Action should be taken by the Program to ensure that complaints regarding potential violations of state and federal Child Labor laws are addressed in a thorough and timely manner.
Current Status: A review of formal complaints during the 2001 Audit found cases that were not thoroughly reviewed, not investigated within the Program's 30-day time frame, or not investigated at all. Since the Audit, the Program has revised its policies and procedures for handling complaints and has re-trained its staff on the proper procedures to accurately and timely address potential violations of the law. The policies and procedures now include a requirement that the investigator make an "in-person" visit to the employer, and they include specific guidance on items to review during the investigation. There is also a requirement for the investigator to follow-up with the employer to ensure any violations found are corrected. In addition, the Program has developed a database for tracking the resolution of complaints it refers to the USDOL.

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Our review of 23 phone complaints initiated during fiscal year 2003 found considerable improvements. All 23 complaints had been addressed through a telephone inquiry, investigation, or referral to another state or federal agency. Of the 17 complaints that required an investigation, all had been investigated within the Program's 30-day time frame. In addition, all the inspections were conducted in person, and the majority of the inspectors reviewed work permits and/or timesheets, and they visually inspected the work site and interviewed the manager on duty to complete the investigation of the complaint. Of the seven complaints that resulted in a violation, follow-up inspections were conducted in all seven cases to ensure the violations were corrected.
Recommendation in 2001: The Program should take steps to do a more thorough job of reviewing the completed work permits submitted by employers.
Current Status: The 2001 Audit identified a number of questionable work permits that were not identified for investigation or follow-up. To address this issue, the Program has developed new policies and procedures that include guidelines on how to review work permits and what actions to take to follow up on questionable work permits. In addition, the work permit was revised in May 2003 to include a blank for employers to specify actual start and end times for the minor's work hours, maximum hours per school and non-school day, and maximum hours per week while school is in and out of session.
The Program is also in the process of implementing an on-line work permit system that will assist in the work permit review process by automatically identifying potential violations of the law. For example, in cases where the employer enters work hours or job duties that are inconsistent with the requirements of the law, the system will generate reports showing the potential violation and automatically generate an assignment for the case to be investigated. In addition, the electronic work permit will have required fields that must be completed by all parties before the work permit can be issued. It should be noted that while the new system will enhance the work permit review process, it will not eliminate the need for review and follow-up by the Program. The new online system is further discussed in the following section.
Recommendation in 2001: If the Program continues to be responsible for reviewing and filing work permits, consideration should be given to computerizing its record-keeping system.
Current Status: At the time of the Audit, the Program had a manual filing system that made it difficult to retrieve a copy of a permit upon request. In addition, the Program could not develop any type of summary data such as the number of work permits issued.
The new web-based work permit system initiated by the Program will automate the issuance of Child Labor work permits. The system will allow online access by the minor requesting the permit, the employer of the minor, the school system's Issuing Officer, and internal Department of Labor staff. It includes a series of reports that can be generated on a scheduled daily or monthly basis by the Program for monitoring such items as potential hours, duties, and age violations, personal information on employed youth under the age of 14, the number of permanent identification cards issued, and the number of work permits mailed to the USDOL. With this new system, the Child Labor Program will be able to gather and report statistical data and will be able to use the information gathered to build a database for tracking and monitoring. The database will be searchable for easy retrieval of information related to the minor, employer or issuing officer. According to Program staff, the on-line system is currently being tested by Gwinnett County Schools and is scheduled to be available to the majority of Georgia schools by the end of January.

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Status of Legislative Matters
Recommendation in 2001: Consideration should be given to either deleting the work permit requirement or revising the work permits to provide additional assurances regarding the minor's safety and well-being.
Current Status: The work permit requirement is still in effect. House Bill 13 was introduced during the 2003 legislative session to add a provision requiring parental consent on the work permit in an effort to provide additional assurance regarding the minor's safety and well being. To date, the bill is still pending. The Program has revised the work permit to require the employer to provide detailed information on the minor's hours of employment.
The Program has not been given statutory authority to assess fines or penalties for non-compliance nor has the statute been revised to require that the signature of the school official serve as approval that the employment is in the minor's best interest in addition to serving as verification of the minor's age.
Recommendation in 2001: If work permits continue to be required, consideration should be given to no longer allowing 16- and 17-year olds to obtain identification cards that exempt them from having to obtain future work permits.
Current Status: The child labor statute continues to provide for the one-time ID cards to 16- and 17-year olds to be used in lieu of a work permit for any subsequent jobs they obtain prior to reaching age 18. The Program has begun conducting unannounced hazardous duty inspections to ensure that 16- and 17-year olds are not employed in jobs that are prohibited by law.
Recommendation in 2001: Consideration should be given to having Georgia law provide a level of protection similar to that provided by federal law.
Current Status: There have been no changes made to Georgia's child labor law to add provisions requiring that the minimum age for employment and work hours more closely align with those outlined in federal law. In addition, no amendment has been made to Georgia's law to provide protection for minors employed in agricultural jobs. The Program continues to enforce state law and reports violations of federal law to the USDOL for enforcement.
There were no amendments to the law to require hour restrictions for 16- and 17-year olds or provisions for rest periods. Currently, neither federal nor state law offer protection in these areas.

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For additional information or to request a copy of the original report, please contact Paul E. Bernard, Director at 404-657-5220
Or see our website: http://www.audits.state.ga.us/internet/pao/rpt_main.html

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