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Changes to child labor law being proposed across America

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As child labor violations soar across the country, dozens of states are ramping up efforts to update child labor laws — with widespread efforts to weaken laws, but some to bolster them as well.

The push for changes to those laws arrives as employers — particularly in restaurants and other service-providing industries — have grappled with labor shortages since the beginning of the pandemic, and hired more teenagers, whose wages are typically lower than adults’.

Labor experts attribute the spike in child labor violations — which, a Post analysis shows, have tripled in 10 years — to a tight labor market that has prompted employers to hire more teens, as well as migrant children arriving from Latin America. In 2023, teens ages 16 to 19 were working or looking for work at the highest annual rate since 2009, according to Labor Department data.

That has led to the largest effort in years to change the patchwork of state laws that regulate child labor, with major implications for the country’s youths and the labor market. At least 16 states have one or more bills that would weaken their child labor laws and at least 13 are seeking to strengthen them, according to a report from the Economic Policy Institute and other sources. Among these states, there are 43 bill proposals.

Since 2022, 14 states have passed or enacted new child labor laws.

Federal law forbids all minors from working in jobs deemed hazardous, including those in manufacturing, roofing, meatpacking and demolition. Fourteen- and 15-year-olds are not allowed to work past 7 p.m. on school nights or 9 p.m. on weekends.

Most states have laws that are tougher than federal rules, although an effort is underway, led by Republican lawmakers, to undo those restrictions, which is supported by restaurant associations, liquor associations and home builders associations.

A Florida-based lobbying group, the Foundation for Government Accountability, which has fought to promote conservative interests such as restricting access to anti-poverty programs, drafted or lobbied for recent bills to strip child labor protections in at least six states.

Among them is Indiana’s new law enacted in March, repealing all work-hour restrictions for 16- and 17-year-olds, who previously couldn’t work past 10 p.m. or before 6 a.m. on school days. The law also extends legal work hours for 14- and 15-year-olds.

Indiana legislators sparred over the bill, with state Sen. Mike Gaskill (R) saying at a hearing in March, “Do not for a second think that this is about the evil employers trying to manipulate and take advantage of kids.” But state Sen. Andrea Hunley (D) called the bill an “irresponsible and dystopian” way of “responding to our workforce shortage.”

In Florida, Gov. Ron DeSantis (R) signed into law changes that allow 16- and 17-year-olds to work seven days in a row. It also removes all hour restrictions for teens in online school or home-school, effectively permitting them to work overnight shifts.

Some states have reported soaring numbers of child-labor violations over the past year, with investigators uncovering violations in fast-food restaurants, but also in dangerous jobs in meatpacking, manufacturing and construction, where federal law prohibits minors from working. The Labor Department alleged in a lawsuit in February that a sanitation company, Fayette Janitorial Service, employed children as young as 13 to clean head splitters and other kill-floor equipment at slaughterhouses on overnight shifts in Virginia and Iowa.

Despite such findings, an Iowa law signed last year by Gov. Kim Reynolds (R) allows minors in that state to work in jobs previously deemed too hazardous, including in industrial laundries, light manufacturing, demolition, roofing and excavation, but not slaughterhouses. Separately, West Virginia enacted a law this month that allows 16- and 17-year-olds to work some roofing jobs as part of an apprenticeship program.

Six more states are evaluating bills to lift restrictions preventing minors from working jobs considered dangerous. A Georgia bill would allow 14-year-olds to work in landscaping on factory grounds and other prohibited work sites. Florida’s legislature has passed a law, drafted by the state’s construction industry association, that would allow teens to work certain jobs in residential construction. It is awaiting approval from DeSantis.

Carol Bowen, chief lobbyist for the Associated Builders and Contractors of Florida, testified in February that the state “has one of the largest skilled-work shortages in recent history” and that the construction industry needs to identify the “next generation.”

Bowen said the bill limits work for 16- and 17-year-olds to home construction projects, adding that teens wouldn’t be able to work on anything higher than six feet.

In Kentucky, the House has passed a bill that prevents the state from having child labor laws that are stricter than federal protections, in effect removing all limitations on when 16- and 17-year-olds can work.

Meanwhile, Alabama, West Virginia, Missouri and Georgia are considering bills this year that would eliminate work permit requirements for minors, verifying age or parental or school permission to work. Most states require these permits. Arkansas Gov. Sarah Huckabee Sanders (R) signed a similar bill into law last year.

Republican lawmakers often say they are trying to increase opportunities or bring requirements in line with federal standards when they push to loosen child labor laws. They say that lowering restrictions helps employers fill labor shortages, while improving teenagers’ work ethic and reducing their screen time. Another common refrain is that permitting later work hours allows high school students opportunities similar to those for varsity athletes whose games often go later than state law allows teens to work.

“These are youth workers that are driving automobiles. They are not children,” said state Rep. Linda Chaney (R), sponsor of the Florida bill expanding work hours for 16- and 17-year-olds, during a hearing in December.

Indiana state Sen. Andy Zay (R), who supported the state’s new law extending work hours for 14- and 15-year-olds, told The Washington Post that as a father of five children, including a son who plays high school basketball, he felt saddened by criticism that teens could be exploited into working later hours under this law.

“I don’t see that, and I don’t feel that. And certainly they would have the freedom to move on,” Zay said.

But the spike in child labor violations and the recent deaths of minors illegally employed in dangerous jobs have also prompted a push by labor advocates to strengthen state laws.

The Virginia legislature unanimously approved a bill in recent weeks that would increase employer penalties for child labor violations from $1,000 to $2,500 for routine violations. Gov. Glenn Youngkin (R) approved the measure Wednesday.

The bill’s sponsor, Del. Holly M. Seibold (D-Fairfax), told The Post that she was “shocked and horrified” to read recently about poultry plants in Virginia illegally employing migrant children and wrote legislation to raise the penalties.

Michigan, Pennsylvania, Iowa, Nebraska and Colorado also are pushing to raise employer penalties for child labor violations, with lawmakers calling them outdated and not substantial enough to deter employers from breaking the law. For example, Iowa fines employers $2,500 for a serious but nonfatal injury of a minor illegally working in a hazardous industry and $500 if there is no serious injury. The new bill proposes an additional $5,000 penalty for an injury that leads to a workers’ compensation case.

Terri Gerstein, director of the Wagner Labor Initiative at New York University, said that the focus on increasing penalties is “good, but, alone, is not good enough,” given that many states have very minimal resources dedicated to enforcing laws.

This year, Colorado legislators have introduced the strongest package to crack down on employers that break child labor laws. The legislation would raise fines for violations and deposit them into a fund for enforcement. Lawmakers are also seeking to make information on companies that violate child labor laws publicly available; in many states, such information is off-limits to the public. Colorado would also legally protect parents of minors who are employed illegally, as some have faced criminal charges for child abuse.

Colorado state Rep. Sheila Lieder (D), who introduced the bill, told The Post that Colorado’s child labor laws aren’t punitive enough to dissuade employers from violating the laws, with just a $20 penalty per offense.

“The fine in Colorado is like a couple cups of coffee at a brand-name coffee store,” Lieder said. “I was just, like, there’s something more that has to be done.”

Jacqueline Aguilar, a 21-year-old college student in Alamosa, Colo., who supports the bill, worked in the lettuce and potato fields on Colorado’s Eastern Plains from the time she was 13, alongside her immigrant parents, to buy school clothes.

“Laws have to be stricter because a lot of people don’t report” violations, said Aguilar, who worked 12-hour shifts in the fields starting at 4:30 a.m. growing up. She said she had no knowledge of her labor rights at the time. “Once I started getting older and my mom became disabled because of the job, it changed my perspective on children working.”

correction

In Kentucky, the House-passed bill that prevents the state from enacting child labor laws stricter than federal protections but does not also repeal requirements for meal and rest breaks for minors. A previous version said that the bill would repeal breaks for minors.

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There’s a key change coming to 401(k) catch-up contributions in 2025

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Many Americans face a retirement savings shortfall. However, setting aside more money could get easier for some older workers in 2025.

Enacted by Congress in 2022, the Secure Act 2.0 ushered in several retirement system improvements, including updates to 401(k) plans, required withdrawals, 529 college savings plans and more.

While some Secure 2.0 changes have already happened, another key change for “max savers,” will begin in 2025, according to Dave Stinnett, Vanguard’s head of strategic retirement consulting.

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Some 4 in 10 American workers are behind in retirement planning and savings, according to a CNBC survey, which polled roughly 6,700 adults in early August.

But changes to 401(k) catch-up contributions — a higher limit for workers age 50 and older — could soon help certain savers, experts say. Here’s what to know.

Higher 401(k) catch-up contributions

Employees can now defer up to $23,000 into 401(k) plans for 2024, with an extra $7,500 for workers age 50 and older.

But starting in 2025, workers aged 60 to 63 can boost annual 401(k) catch-up contributions to $10,000 — or 150% of the catch-up limit — whichever is greater. The IRS hasn’t yet unveiled the catch-up contribution limit for 2025.  

“This can be a great way for people to boost their retirement savings,” said certified financial planner Jamie Bosse, senior advisor at CGN Advisors in Manhattan, Kansas.

An estimated 15% of eligible workers made catch-up contributions in 2023, according to Vanguard’s 2024 How America Saves report.

Those making catch-up contributions tend to be higher earners, Vanguard’s Stinnett explained. But they could still have “real concerns about being able to retire comfortably.”

More than half of 401(k) participants with income above $150,000 and nearly 40% with an account balance of more than $250,000 made catch-up contributions in 2023, the Vanguard report found.

Roth catch-up contributions

Another Secure 2.0 change will remove the upfront tax break on catch-up contributions for higher earners by only allowing the deposits in after-tax Roth accounts.

The change applies to catch-up deposits to 401(k), 403(b) or 457(b) plans who earned more than $145,000 from a single company the prior year. The amount will adjust for inflation annually. 

However, IRS in August 2023 delayed the implementation of that rule to January 2026. That means workers can still make pretax 401(k) catch-up contributions through 2025, regardless of income.

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Holiday shoppers plan to spend more, while taking on debt this season

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Increase in consumer holiday spending expected this year, says Mastercard's Michelle Meyer

Americans often splurge on gifts during the holidays.

This year, holiday spending from Nov. 1 through Dec. 31 is expected to increase to a record total of $979.5 billion to $989 billion, according to the National Retail Federation.

Even as credit card debt tops $1.14 trillion, holiday shoppers expect to spend, on average, $1,778, up 8% compared to last year, Deloitte’s holiday retail survey found.

Meanwhile, 28% of holiday shoppers still haven’t paid off the gifts they purchased for their loved ones last year, according to another holiday spending report by NerdWallet

How shoppers pay for holiday gifts

Heading into the peak holiday shopping season, 74% of shoppers plan to use credit cards to make their purchases, NerdWallet found.

Another 28% will tap savings to buy holiday gifts and 16% will lean on buy now, pay later services. NerdWallet polled more than 1,700 adults in September.  

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Buy now, pay later is now one of the fastest-growing categories in consumer finance and is only expected to become more popular in the months ahead, according to the most recent data from Adobe. Adobe forecasts BNPL spending will peak on Cyber Monday with a new single-day-record of $993 million.

However, buy now, pay later loans can be especially hard to track, making it easier for more consumers to get in over their heads, some experts have cautioned — even more than credit cards, which are simpler to account for, despite sky-high interest rates.

The problem with credit cards and BNPL

To be sure, credit cards are one of the most expensive ways to borrow money. The average credit card charges more than 20% — near an all-time high.

Alternatively, the option to pay in installments can make financial sense, especially at 0%. 

And yet, buy now, pay later loans “are just another form of credit, disguised as something for free,” said Howard Dvorkin, a certified public accountant and the chairman of Debt.com.

The more BNPL accounts open at once, the more prone consumers become to overspending, missed or late payments and poor credit history, other research shows.

If a consumer misses a payment, there could be late fees, deferred interest or other penalties, depending on the lender. In some cases, those interest rates can be as high as 30%, rivaling the highest credit card charges. 

“This is just another way for financers to put their hands in the pocket of consumers,” Dvorkin said. “It’s a trojan horse.”

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Here’s why the U.S. retirement system isn’t among the world’s best

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The U.S. retirement system doesn’t get high marks relative to other nations.

In fact, the U.S. got a C+ grade and ranked No. 29 out of 48 global pension systems in 2024, according to the annual Mercer CFA Institute Global Pension Index, released Tuesday. It analyzed both public and private sources of retirement funds, like Social Security and 401(k) plans.

A similar index compiled by Natixis Investment Management puts the U.S. at No. 22 out of 44 nations this year. Its position has declined from a decade ago, when it ranked No. 18.

“I think [a C+ grade] would describe a rating where there is a lot of room for improvement,” said Christine Mahoney, global retirement leader at Mercer, a consulting firm.

The Netherlands placed No. 1, followed by Iceland, Denmark and Israel, respectively, which all received “A” grades, according to Mercer. Singapore, Australia, Finland and Norway got a B+.

Fourteen nations — Chile, Sweden, the United Kingdom, Switzerland, Uruguay, New Zealand, Belgium, Mexico, Canada, Ireland, France, Germany, Croatia and Portugal — got a B.

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Of course, retirement systems differ since they address a nation’s unique economies, social and cultural norms, politics and history, according to the Mercer report. However, there are certain traits that can generally determine how well older citizens fare financially, the report found.

The U.S. system is often referred to as a three-legged stool, consisting of Social Security, workplace retirement plans and individual savings.

The lackluster standing by the U.S. in the world is largely due to a sizable gap in the share of people who have access to a workplace retirement plan, and for the ample opportunities for “leakage” of savings from accounts before retirement, Mahoney said.

Employers aren’t required to offer a retirement plan like a pension or 401(k) plan to workers. About 72% of workers in the private sector had access to one in March 2024, and about half (53%) participated, according to the U.S. Bureau of Labor Statistics.  

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“The people who have [a plan], it’s probably pretty good on average, but you have a lot of people who have nothing,” Mahoney said.

By contrast, some of the highest-ranked countries like the Netherlands “cover essentially all workers in the country,” said Graham Pearce, Mercer’s global defined benefit segment leader.

Additionally, top-rated nations generally have greater restrictions relative to the U.S. on how much cash citizens can withdraw before retirement, Pearce explained.

American workers can withdraw their 401(k) savings when they switch jobs, for example.

About 40% of workers who leave a job cash out “prematurely” each year, according to the Employee Benefit Research Institute. A separate academic study from 2022 examined more than 160,000 U.S. employees who left their jobs from 2014 to 2016, and found that about 41% cashed out at least some of their 401(k) — and 85% completely drained their balance.

Employers are also legally allowed to cash out small 401(k) balances and send workers a check.

While the U.S. might offer more flexibility to people who need to tap their funds in case of emergencies, for example, this so-called leakage also reduces the amount of savings they have available in old age, experts said.

“If you’re someone who moves through jobs, has low savings rates and leakage, it makes it difficult to build your own retirement nest egg,” said David Blanchett, head of retirement research at PGIM, Prudential’s investment management arm.

Social Security is considered a major income source for most older Americans, providing the majority of their retirement income for a significant portion of the population over 65 years old.

To that point, about nine out of 10 people aged 65 and older were receiving a Social Security benefit as of June 30, according to the Social Security Administration.

Social Security benefits are generally tied to a worker’s wage and work history, Blanchett said. For example, the amount is pegged to a worker’s 35-highest years of pay.

While benefits are progressive, meaning lower earners generally replace a bigger share of their pre-retirement paychecks than higher earners, Social Security’s minimum benefit is lesser than other nations, like those in Scandinavia, with public retirement programs, Blanchett said.

“It’s less of a safety net,” he said.

“There’s something to be said that, as a public pension benefit, increasing the minimum benefit for all retirees would strengthen the retirement resiliency for all Americans,” Blanchett said.

That said, policymakers are trying to resolve some of these issues.

For example, 17 states have established so-called auto-IRA programs in a bid to close the coverage gap, according to the Georgetown University Center for Retirement Initiatives.

These programs generally require employers who don’t offer a workplace retirement plan to automatically enroll workers into the state plan and facilitate payroll deduction.

A recent federal law known as Secure 2.0 also expanded aspects of the retirement system. For example, it made more part-time workers eligible to participate in a 401(k) and raised the dollar threshold for employers to cash out balances for departing workers.

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