PHILADELPHIA ‒ Perdue Farms Inc. and the US Department of Labor reached an agreement while securing a separate agreement with temporary staffing agency Staff Management Solutions LLC and SMX LLC, which are known together as SMX, regarding child labor violations found at a Perdue poultry processing facility in Accomac, Va.

The agreement laid out by DOL explained that Perdue Farms would pay $4 million in restitution to the children, organizations advocating for child labor victims, and support additional work to prevent child labor exploitation. The company also agreed to pay a $150,000 civil monetary penalty.

Wage and Hour Division investigators stated that Perdue Farms contracted with SMX for jobs in which they jointly employed children in hazardous positions at the plant to debone and process chicken. The report indicated that minors used equipment such as electric knives and a heat-sealing press. DOL added that employers allowed them to work after 7 p.m. The conditions listed by the agency violated the Fair Labor Standards Act’s child labor hazardous order and hours provisions. 

The time period the investigation looked at was between 2020 and 2023. 

Following the agreement, Perdue Farms provided more insights in a statement to MEAT+POULTRY.

“Perdue fully cooperated with the Department of Labor’s investigation and the investigation did not identify any current underage workers at Perdue Farms,” said Andrea Staub, spokesperson for Perdue Farms. “While we strongly disagreed with DOL’s findings of liability, and there are no admissions in the agreement to the contrary, Perdue recognized that a prolonged dispute with the Department of Labor did nothing to address the child labor crisis. We are dedicated to advancing work that helps stem the child labor crisis in America by investing in our communities, education systems and essential social support networks.”

The company added that it would establish a $2 million fund to benefit impacted minors, directing $2 million to charitable organizations in the Accomac community that assist unaccompanied migrant children. Perdue selected Eastern Shore Community College and Kids in Need of Defense (KIND) as recipients of the donations. 

“Preventing child labor exploitation requires creative, well-resourced coordination among a broad spectrum of stakeholders, including industry leaders like Perdue,” said Wendy Young, president of KIND. “We are pleased that our monthslong conversation with Perdue has resulted in this partnership, which will protect the rights and wellbeing of children in the workplace.”

More information released by the Wage and Hour Division found that Perdue violated the FLSA’s “hot goods” provision, which prevents employers from shipping goods produced in, or about a facility where there was illegal child labor. 

The US District Court for the Eastern District of Virginia in Norfolk stated that Staff Management Solutions agreed to pay a $125,000 civil penalty and permanently enjoined from future FLSA child labor violations in meat processing and packing industries. 

“There is no single enforcement action or lawsuit that will stop unlawful child labor, but strong enforcement coupled with companies willing to come to the table and take responsibility is vital,” said Seema Nanda, US solicitor of labor. “Perdue Farms has substantial influence in the poultry processing industry. By entering into this agreement, Perdue Farms is taking meaningful action to root out child labor not only at its facilities but to recognize its corporate responsibility to combat child labor more broadly.” 

In the agreement, both Perdue and SMX agreed to implement compliance measures, including not hiring anyone under the age of 18 in certain locations. 

Next, the companies must provide mandatory child labor training for managers and employees. The companies also will put in measures to discipline or terminate anyone who does not comply with federal child labor laws. 

Perdue and SMX must not retaliate against any of its employees, including family members or guardians of minor children, because an employee has filed any complaint or instituted or caused to be instituted any proceeding under or related to the FLSA, or has testified or is about to testify in any such proceeding, or has served or is about to serve on an industry committee. 

The companies must also establish a designated tip line for employees to report compliance issues.