U.S. Accuses Hyundai and Two Other Companies of Using Child Labor

The Labor Department on Thursday sued Hyundai over the use of child labor in Alabama, holding the car manufacturer liable for the employment of children in its supply chain, including a 13-year-old girl who worked up to 60 hours per week making car parts.

In the suit, filed in a federal court in Montgomery, Ala., the department said Hyundai was responsible for the employment of children at a Smart Alabama factory in Luverne, Ala., which produces parts like body panels that are shipped to a Hyundai factory in Montgomery. The suit also claimed a staffing agency, Best Practice Service, recruited the children to work at the supplier’s plant.

In a statement, Hyundai said child labor was “not consistent with the standards and values we hold ourselves to as a company.” It added that the Labor Department used “an unprecedented legal theory that would unfairly hold Hyundai accountable for the actions of its suppliers.”

Smart did not immediately respond to a request for comment. Representatives of Best Practice Service, which is no longer in business, could not be reached for comment.

From July 2021 to February 2022, a 13-year-old girl worked at the Smart plant, where she was recruited to work by Best Practice Service, the suit claimed. The suit also contended that two other children were employed at the plant.

The Labor Department said that through the employment of children at its supplier, Hyundai was in violation of the “hot goods” provision of the Fair Labor Standards Act, which prevents the interstate commerce of goods “that were produced in violation of the minimum wage, overtime, or child labor provisions” of that law.

“Companies cannot escape liability by blaming suppliers or staffing companies for child labor violations when they are in fact also employers themselves,” said Seema Nanda, the Labor Department’s chief legal officer, in a statement Thursday.

The suit comes after investigations by Reuters and The New York Times documented the use of child labor by the suppliers of car companies. In 2022, Reuters found that Smart Alabama had used child labor at its facility, and Kia, which is part of the same South Korean conglomerate as Hyundai, had also used child labor in the South. A 2023 investigation by The Times found children employed at the suppliers of General Motors and Ford.

Hyundai imports many of its vehicles from South Korea but has made big investments in factories in the South, spending nearly $8 billion on an electric vehicle plant in Georgia. The United Automobile Workers union has said that it hopes to organize workers at Hyundai’s Montgomery plant.