The Department of Labor filed a lawsuit against Hyundai over child labor in Alabama on Thursday, alleging that the company is liable for employing children in its supply chain, including a 13-year-old girl who worked as many as 60-hour weeks making auto parts.
In a lawsuit filed in federal court in Montgomery, Alabama, the Department of Labor alleged that Hyundai was responsible for hiring children at its Smart Alabama plant in Luverne, Alabama, which makes body panels and other parts that are shipped to Hyundai's plant in Montgomery. The lawsuit also alleges that a staffing firm, Best Practice Services, recruited children to work at a supplier's factory.
Hyundai said in a statement that child labor is “contrary to the standards and values ​​we uphold as a company,” adding that the Department of Labor had used “an unprecedented legal theory to hold Hyundai unjustly liable for the actions of its suppliers.”
Smart did not immediately respond to a request for comment. A representative for Best Practice Services, which is now defunct, could not be reached for comment.
According to the lawsuit, a 13-year-old girl was employed by Best Practice Services and worked at the Smart Factory from July 2021 to February 2022. The lawsuit also alleges that two other children were employed at the factory.
The Department of Labor said Hyundai's employment of children at its suppliers violated the “hot goods” provision of the Fair Labor Standards Act, which prohibits interstate commerce in goods “produced in violation of the minimum wage, overtime, and child labor provisions” of the act.
“Companies cannot avoid responsibility by blaming suppliers or recruitment agencies, who are in fact the employers, for child labor violations,” Seema Nanda, the labor ministry's chief legal officer, said in a statement Thursday.
The lawsuit was filed after investigations by Reuters and The New York Times uncovered child labor by suppliers to the auto companies. In 2022, Reuters found that Smart Alabama had used child labor in its facilities, and that Kia Motors, a South Korean conglomerate like Hyundai, also used child labor in the South. A 2023 Times investigation found that children were employed by suppliers to General Motors and Ford Motor.
Hyundai imports many of its cars from South Korea but has invested heavily in factories there, including an $8 billion electric vehicle plant in Georgia. The United Auto Workers union has said it wants to unionize workers at Hyundai's Montgomery plant.