Do child labor laws affect teenage micro business owners?
The attorneys at Home School Legal Defense Association HSLDA have some helpful insights into entrepreneurship and child labor laws.
Entrepreneurship and Child Labor Laws
What about a student who wants to start his or her own business? Young people can spend as long as they like writing a book, filming a video, programming a website, painting a picture, or in any other creative endeavor, as long as they are not being paid. If the student is 16 or younger and being paid, he or she is subject to child labor laws.
Typical entrepreneurial activities, such as shoveling snow or babysitting, theoretically count as “working for” an employer—i.e., your neighbor. Restrictions on hours and types of work still apply.
These jobs (shoveling snow or babysitting) involve a teenager working in or around a private residence. These teenagers are considered household employees by the US government. That’s why child labor laws apply to them. I explain this more in Money and Taxes in a Micro Business.
Limits on work hours for teen employees
Typically, the child is limited to 3 hours of work per day during a school week, or 18 hours a week. He may not work before 7:00 a.m. or after 7:00 p.m. except from June 1 to Labor Day, when evening hours are extended to 9:00 p.m. When the public school is not in session (such as during the summertime), children under 16 may work up to 8 hours a day or 40 hours a week.)
Employee or business owner?
Child labor laws apply to children working for an employer, but not to a teenager running a business! You can put in as many hours as you want working on your business.
The US Department of Labor website explains,
Young entrepreneurs who use the family lawnmower to cut their neighbor’s grass or perform babysitting on a casual basis are not covered under the Fair Labor Standards Act (FLSA)
The FLSA and it’s child labor laws covers employees. Micro business owners are not employees. They are their own bosses.
So work hard at your micro business!
Need help understanding whether your are an employee, household employee or micro business owner? My book Money and Taxes in a Micro Business explains all that and much more. Order a copy today.
Carol Topp, CPA