Franz Kafka in Footie Pajamas - WSJ:
"...Rhea Lana’s operations are similar to more than a thousand other consignment event businesses in the country.
Our locations host two sales a year, each running two to eight days.
Before a sale, consignors list their clothes and toys on our website, along with their asking prices.
On the day of the event, they bring the items to the location and set them up for display.
Consignors keep 70% of the proceeds.
They can also volunteer before and during the event—doing everything from setting up display racks, to checking out customers, to helping buyers carry heavy purchases to their cars.
As a perk, volunteers are allowed to shop before the general public, and they are sometimes given preferential treatment on display locations for their own items.
But such mutually beneficial exchange is apparently a foreign concept to the federal government.
In January 2013 the Labor Department audited our employment practices.
Four months later the bureaucracy concluded that our volunteers are actually “employees.”
As such, we were told that we were in violation of Sections 6 and 7 of the Fair Labor Standards Act regarding minimum wages and overtime pay.
I was told this during a face-to-face meeting, without any accompanying written complaint or advance notice of allegations.
In a word, this was terrifying.
I’m a small-business owner in Arkansas, not a major corporation with an army of lawyers familiar with such federal inquiries.
Three months later—and still before we had received written notice or had any official action taken against us—the department sent letters to our consignors and volunteers inviting them to sue us for back wages.
Tellingly, not a single person did..."
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