Special Report-How a fake ID repeatedly enabled Hyundai suppliers to
employ child labor in Alabama
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[April 28, 2023]
By Mica Rosenberg, Joshua Schneyer and Kristina Cooke
MONTGOMERY, Alabama (Reuters) - On Nov 22, a team of state and federal
labor officials conducted a surprise inspection and noticed a
young-looking worker at a warehouse operated here by the logistics unit
of Korean automaking giant Hyundai Motor Group.
The inspectors, according to an Alabama Department of Labor field report
reviewed by Reuters, had received a complaint from an unspecified
tipster about "under-age children working" at the facility. During their
visit to Hyundai Glovis Co Ltd, the report notes, the boy "was manually
restacking large metal castings."
Inspectors approached the boy, named in company paperwork as "Fernando
Ramos," and questioned him about his age and schooling. Answering in
Spanish, the boy said he was 18 years old and had attended a Montgomery
middle school. But the documents in his personnel file, inspectors
determined later, identified "Fernando Ramos" as a 34-year-old man from
Tennessee.
Nothing but the name of the middle school proved to be true.
Inspectors learned the boy, a migrant from Mexico, had just turned 16.
And the credentials in his file – a forged Tennessee ID and a phony
social security card – didn't look remotely legitimate. The state ID
featured another person's picture. The name and number on the social
security card were printed in two different, inauthentic fonts.
Investigators concluded the boy had been using them since he was 14.
The boy had been hired by a labor recruiter, a staffing agency of the
kind that fills many manufacturing jobs in Alabama and across the United
States. Although some warehouse and factory jobs can be performed
legally by 16-year-olds, investigators allege that labor recruiters had
employed the boy repeatedly even before he turned that age.
Staffing agencies, they soon alleged, had hired him for work in at least
three other Alabama auto-parts makers for Hyundai, the largest factory
employer in the state and the third-largest U.S. automaker by sales.
"Wages being reported for F. RAMOS," the field report noted, "for
numerous companies."
The finding led the Alabama Department of Labor in February to fine
three local staffing agencies, alleging they had illegally hired the boy
for factory work. None of the agencies disputed the allegation, and each
paid penalties of $5,050, the maximum state levy for a child labor
violation. It isn't clear whether the recruiters will face federal
penalties.
An Alabama Department of Labor spokesperson declined to make inspectors
involved in the investigation available for interviews. The probe is
part of "a continuing investigation into minors working in the Hyundai
supply chain," department records reviewed by Reuters show.
A spokesperson for the U.S. Department of Labor, which had officials
present at the visit, also declined to allow inspectors to comment.
The spokesperson said the department's Wage and Hour Division has open
investigations into Hyundai Glovis and Hyundai Motor Manufacturing
Alabama LLC, the carmaker's assembly unit in Montgomery. That unit
builds about half the vehicles the Korean company sells in the United
States.
The federal probes and the details of the state fines against the three
labor recruiters haven't previously been reported. The U.S. and Alabama
investigations began after a Reuters report last July first exposed the
use of child labor at Hyundai parts makers in the state.
In a statement, Hyundai said it has since audited suppliers and
"strongly discouraged" the use of third-party labor recruiters. Last
month in Montgomery, it added, the company held a training seminar on
"illegal child labor prevention" attended by over 500 people from across
its U.S. supply chain.
"Regardless of the involvement of third-party staffing agencies," the
statement read, "Hyundai recognizes and fully embraces its
responsibility to make sure all suppliers understand and meet our high
global workforce standards." Hyundai didn't answer specific questions
from Reuters about the boy found working at Hyundai Glovis.
In a separate statement, Hyundai Glovis said it has cooperated with
investigators. Although its own in-house policy stipulates that workers
must be at least 18, the company said it hasn't been cited for any legal
infractions. The boy was hired by an agency, the statement said, and
"the job of that individual was packing boxes, which is permitted for
that age."
Hyundai Glovis didn't identify the agency that employed the boy or
comment further on the tasks he was performing at the warehouse.
The ease with which the phony paperwork secured employment for a migrant
minor at a major manufacturer illustrates the difficulties regulators
face amid a surge in illegal child labor in the United States.
That boom has been driven by adult labor shortages since the onset of
the COVID-19 pandemic, and state and federal enforcement agencies say
they need more resources to better combat it. The U.S. Department of
Labor said in February the number of child labor violations in 2022 had
soared by nearly 70% compared with the tally recorded in 2018.
Last year, Reuters revealed the use of child labor in hazardous
factories across Alabama, reporting in February 2022 about teens from
Guatemala illegally hired to work in chicken processing plants. Reuters
also revealed the widespread and illegal employment of migrant children
as young as 12 in Alabama factories supplying both Hyundai and
sister-brand Kia.
In addition to leading to the probes by law enforcement and regulators,
the coverage was followed by other media examinations of the problem of
child labor in the United States.
The news agency's reporting helped prompt the rescue of several children
from one factory floor and spurred at least 10 ongoing state or federal
investigations. It also has been cited by members of Congress who are
drafting legislation that would increase penalties, at present
considered paltry by labor experts, for employers illegally hiring
children.
Hyundai, for its part, announced it would divest its majority stake in a
parts maker where Reuters first reported the employment of child
workers.
Many of the child laborers found by Reuters worked under fake
identities, often provided by staffing agencies or by brokers who
specialize in forged documents. The United States has federal laws and
systems meant to ensure the eligibility of prospective employees.
But phony credentials are commonly used by undocumented adult immigrants
to get around those curbs. And bogus IDs also have enabled third-party
labor recruiters to place kids in plants where it is illegal for
children to work.
Those recruiters, in turn, can shield large manufacturers, like Hyundai,
from the obligation to ensure their workforces comply with labor laws.
"Our laws enable the lead corporations to avoid responsibility and use
intermediaries to insulate themselves," said Terri Gerstein, director of
the state and local enforcement project at Harvard Law School's Labor
and Worklife Program.
To understand how phony credentials channeled a child to industrial job
sites in one of the world's most developed economies, Reuters reviewed
field notes, penalty letters, copies of false identity documents and
employment records. Reporters this month obtained many of the Alabama
Department of Labor documents through a state public records request.
Reuters also spoke with more than half a dozen people familiar with the
probes into Hyundai's supply chain. They said false documentation, even
shoddy credentials like those filed by the boy's employers, makes child
labor laws difficult to enforce.
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A view of the Hyundai Glovis logistics
company in Montgomery, Alabama, U.S., April 25, 2023. REUTERS/Cheney
Orr
Unless authorities find children at work, confirm their real
identities, and figure out who hired them, investigators can
struggle to prove wrongdoing. After Reuters' initial stories about
child labor in Alabama, workers in the area told reporters that
agencies laid off many young-looking employees from at least five
factories.
An Alabama labor department spokesperson told Reuters the agency is
still working to determine who exactly hired the child to work at
Hyundai Glovis. The boy had been "filtered," one of the state
records notes, "through several layers of employment services."
Reporters determined the child's true identity through documents and
interviews. Because he remains a minor, Reuters is choosing not to
identify him.
The father confirmed the family's history in a phone interview. The
man said he still lives with his son in the Montgomery area and that
no government officials have been to their house since the boy left
Hyundai Glovis. State records make no mention of investigators
interacting with the boy since the surprise inspection.
Reuters also reached the real Fernando Ramos. He lives in Texas and
expressed surprise to learn in a brief exchange, via Facebook, that
his identity was being used in auto plants in Alabama. "What the
hell," he messaged.
"THEY'VE GONE TO WORK SOMEWHERE"
The Mexican boy, then aged 12, arrived in the United States in 2019,
according to a person familiar with his immigration history and the
Alabama records. Part of a still-growing spike in unaccompanied
minors entering the United States, he turned himself in to
immigration authorities at the Arizona border.
Officials soon released him to the custody of his father, who was
already living in Alabama.
When he arrived in Montgomery, the father told Reuters, the boy
struggled with English, tired of school, and instead decided to
work. The father said he was unaware at the time that the boy took
the factory jobs.
After receiving the tip about Hyundai Glovis, Alabama and federal
labor officials organized the November inspection of the warehouse,
where parts are stored and prepared for later assembly by Hyundai.
During the inspection, investigators saw the boy lifting the
castings – big metal parts of the sort often used in vehicle
assembly.
A federal official took a photo of the boy, the field report shows.
A week later, a state inspector took the photo to Southlawn Middle
School, where the boy told them he had studied.
At the school, two staff members and a student helped identify him.
He last attended in September 2021, according to school records. One
teacher, who taught English for non-native speakers, remembered him
as a soft-spoken but truant teen. His mother tongue wasn't Spanish,
but a Mixtec indigenous language spoken in parts of Mexico and
Central America.
"He would be there for a few weeks and then he would leave," Rick
Bevel, the teacher, told Reuters. As with other migrant students who
often disappeared, he added, "I assume they've gone to work
somewhere."
It isn't clear how the Ramos ID documents became associated with the
boy or when he may have first worked in the Alabama auto industry.
Reuters couldn't independently confirm that he was employed by the
staffing agencies cited and fined by Alabama regulators.
But as investigators began researching, they concluded the bogus
Ramos credentials had been used since at least 2021, when the boy
was 14.
Many jobs are available to minors in the United States, such as
waiting tables or clerking in clothing stores. But Alabama and
federal law forbid the hiring of anyone under 16 in industrial
plants, where machinery, heavy cargo and other risks can pose deadly
hazards. The most dangerous jobs, including many in the automotive
sector, are prohibited for anyone under 18.
Through on-site interviews at Hyundai Glovis and reviews of state
wage records, investigators sought to identify who had hired the
boy. The wage records linked to the phony credentials showed that at
least three staffing agencies had used the documents: Ace Industry
Co, of Dadeville, Alabama; Issac USA Inc, of Lanett, Alabama; and
Job Supply System LLC, also of Montgomery.
It was enough for the Alabama labor department to fine those three
recruiters. In penalty letters to each, the department cited the
boy's genuine name and birthdate, alleged he had worked for them
using the falsified documents, and fined them $5050.
David Martin, Issac USA's Montgomery-based attorney, in a statement
told Reuters the company "has cooperated" with investigators and
declined to comment further. The news agency was unable to reach Ace
Industry or Job Supply System for comment.
The auto-parts plants where the boy allegedly worked haven't been
accused of wrongdoing. In addition to Hyundai Glovis, those
companies included three Korean-owned suppliers of interior
components for Hyundai and Kia vehicles: Sejin America Inc, DAS
North America Inc, and Daehan Solution Alabama LLC.
In statements to Reuters provided by a public relations firm, all
three companies said they have adopted strict measures in recent
months to ensure workers are legally eligible for employment.
Sejin and DAS didn't answer questions about the boy, his employment
or the identity documents. Daehan, in its statement, said it has "no
knowledge of the case referenced in your questions."
To determine if a prospective employee is authorized for work,
Alabama and many other states require companies to enter
identification details into a federal vetting system known as
E-verify.
The program, operated by U.S. Citizenship and Immigration Services,
or USCIS, can determine whether a social security number is valid,
but can't check whether the number actually belongs to the person
for whom it is submitted.
The Ramos credentials, according to E-verify documents included in
the Alabama records, cleared the system repeatedly.
USCIS in a statement said it has been working to improve E-verify. A
spokesperson for the federal agency declined to comment on the use
of the Ramos documents or the boy's case.
After the surprise inspection, the boy didn't return to work at the
warehouse, according to a person familiar with the investigations.
His father told Reuters the boy informed him of the inspection
shortly after it happened. The father said he has tried
unsuccessfully to get the boy to go back to school.
"When I brought him from Mexico, it was to study," he said. "I tell
him to go to school but he doesn't want to."
Fernando Ramos, Reuters found, is a real person whose social
security number and date of birth match those of the phony
credentials used in the Alabama plants. Using public records and
social media, reporters tracked him down in south Texas, about a
thousand miles from the automotive facilities where his identity has
been used.
In his online exchange with a reporter, Ramos said he had no idea
how his details could have been obtained by the staffing agencies.
Reuters sent him a copy of the false Tennessee ID bearing his name.
"That picture," he responded, "it's not me."
(Additional reporting by Hyunjoo Jin in San Francisco. Editing by
Paulo Prada.)
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