Popular Boise-area ice cream chain fined for child-labor violations. What happened?
Stella’s Ice Cream — a popular chain with locations in Boise, Eagle, Nampa and Caldwell — was slapped with $321,000 in penalties Thursday for violating child labor laws, according to the U.S. Department of Labor.
The department found that the Nampa-based company had assigned dangerous tasks to dozens of children in all four of its shops and illegally shared tips with managers. The company regularly employed workers between 14 and 15 years old to use industrial mixers, drive a delivery van and work past 10:30 p.m., the department said in a news release.
Federal law bars employers from working 14- and 15-year-olds past 7 p.m., and they are not allowed to work over 18 hours per week during school months. Between June 1 and Labor Day, they are allowed to work until 9 p.m., according to the release.
“Learning new skills in the workplace is an important part of growing up, but we must protect children and ensure their first jobs are safe and do not interfere with their education or well-being,” said Katherine Walum, the department’s wage and hour division district director.
“The Fair Labor Standards Act,” she said, “allows for work experiences but restricts the employment of young workers in certain jobs and provides for penalties when employers do not follow the law.”
The department also found that Stella’s Ice Cream had shared tips from tipped workers with managers and supervisors, which is banned in federal regulations. The department recovered nearly $79,500 in back wages and liquidated damages for 208 workers.
Chad Hartley, the CEO and founder of Stella’s, said that while the company acknowledges the findings and is not hiding from the allegations, the penalties are excessive.
“While we accept full responsibility for addressing the concerns identified, we strongly disagree with the final ruling, which imposes grossly disproportionate fines that unfairly target small businesses like ours,” he said in a statement. “It is important to note that these incidents occurred during the period of 2019-2022, and we have been in full compliance with all federal regulations since immediately addressing these concerns upon notification of the discrepancies.”
The $321,000 in penalties come amid a significant national increase in the amount employers have had to pay over child-labor violations, according to Department of Labor data. From the 2013 to 2021 federal fiscal years, the average money penalties ranged from about $1.4 million to $3.6 million.
The penalties jumped to $8 million in 2023 and $15 million in the federal 2024 fiscal year that ended Sept. 30, though the number of cases with child-labor violations dropped from 955 in 2023 to 736 in 2024.
Owner says government targeted small business
According to Hartley’s statement, teenage employees had occasionally used equipment like a KitchenAid mixer and ovens to make cookies and brownies.
“This equipment, commonly found in households across America and widely regarded as safe, was deemed non-compliant because the mixer exceeded the federal government’s maximum allowable horsepower under an obscure and outdated regulation,” the statement said. “It is difficult to reconcile that teenagers can legally operate motor vehicles on public roads yet are prohibited from using a household-style kitchen mixer in a small-business setting.”
The penalty for teenagers who worked late, Hartley said, was because of contradictory and inconsistent rules between the state and federal government. The tip-sharing, he said, was an attempt to “create a fair and equitable system for all employees who contribute to serving our customers, regardless of their assigned job titles.”
“We believe that everyone who plays a role in providing great customer service should share equally in the tips left by our patrons,” Hartley said. “Unfortunately, the federal government does not agree with this approach and has taken issue with our efforts to promote fairness and equality in the workplace.”
The tips were distributed fairly among team members and the company had never taken tips away from employees for the benefit of ownership, according to the statement. No employees were harmed or negatively impacted by any of the findings, Hartley said, and the fines unfairly targeted and penalized a small business.
“While it is unfortunate, hopefully this will help other small businesses in Idaho avoid the treatment we have received,” Hartley told the Idaho Statesman.
This story was originally published December 12, 2024 at 3:50 PM.
