Read the full story here: Bloomberg BusinessWeek
The DOL’s actions could cripple Riner’s business and the “entire consignment industry,” the lawsuit alleges. It was filed in federal court for the District of Columbia by Cause of Action, a legal group founded in 2011 to support limited government. It challenges the Labor Department’s policy of banning for-profit enterprises from using volunteer labor, and it asks the court to block the DOL from further investigating or collecting penalties from Rhea Lana’s. It also asks for attorney’s fees but does not request a specific monetary award.
As I wrote last summer, the U.S. Labor Department opened an investigation into Rhea Lana’s volunteer policy in January 2013, after the Arkansas Department of Labor took a similar action. In August 2013, the feds informed the company that it was in violation of minimum wage laws for not fairly compensating its volunteers—mostly stay-at-home mothers and retired grandmothers who help staff Rhea Lana’s mammoth consignment sales in Riner’s hometown of Conway, Ark., and around the country through her franchisees. In exchange for their work, volunteers are given an opportunity to shop early at the sales, snagging the best used toys, clothes, and baby gear for themselves.
