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IMPLICATIONS OF LABOR LAWS IN THE CONTEXT OF BOTTLING PARTIES AND SIMILAR EVENTS

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DON’T BOTTLE TROUBLE

ardly a week goes by without an announcement crossing my social media stream about an upcoming bottling event at a craft distillery. In many cases, my feed tells me that the distillery is looking for passionate supporters of the brand to come down to the facility and help with the bottling on a given day — in exchange for which these helpers will earn the locally required minimum wage, get the opportunity to purchase one of the bottles and possibly receive a hearty lunch. Not a bad deal, really. Perhaps more often, however, the distillery is asking for volunteers to assist with bottling. The volunteers will still receive the hearty lunch and the opportunity to buy a bottle and some merchandise — possibly with the benefit of the distillery’s friends, family and employee discount — but will not earn any actual cash. And this is the sort of thing that keeps me up at night. You see, I really want to participate in a bottling party. I’d love nothing more than spending a Saturday at a distillery filling bottles, applying labels and packing cases of one of my favorite spirits. But I just can’t bring myself to do it. And it isn’t because I’m too busy or can’t be bothered; it is because I really don’t want to get these small distilleries in trouble, and I know that under state and federal law these kinds of bottling parties are problematic. Under a federal statute known as the Fair Labor Standards Act (FLSA), the use of volunteers to provide labor is highly regulated. That doesn’t mean it is prohibited. But if the volunteer doesn’t fit within the very narrow confines of what the Department of Labor (DOL) considers a volunteer, then the individual is most likely actually an employee under applicable federal law. And that means that the business benefiting from the labor will have failed to pay the individual a minimum wage. That failure carries with it some rather draconian potential consequences, including not only the obligation to pay the unpaid wages but also liquidated damages in an additional amount equal to the unpaid wages, plus the attorney’s fees of any individual who successfully brings a claim. Depending on the business location, an individual may be able to obtain additional penalties and remedies under state and local wage and hour laws. And if that weren’t enough, it makes for a very bad and very public spectacle, which can result in significant reputational damage. With this as the potential consequence

WRITTEN BY BRIAN B. DEFOE

of mischaracterizing volunteers, it is important to understand who is — and who is not — a volunteer. Under the FLSA, an individual may only be classified as a volunteer if her labor meets the following criteria:

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It is performed for public service, humanitarian or religious objectives; It is performed without the expectation or receipt of any kind of compensation; and

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It does not displace employees and is not of the type that would otherwise be performed by employees.

The DOL is quite strict in its application of these principles. For example, the DOL has opined that individuals could be characterized as volunteers if — while assisting a hospice center — they sat with patients simply to provide the patients’ families with needed breaks or attended funerals. But they could not be characterized as volunteers if, instead of sitting with patients, they were providing general clerical or administrative support to the hospice. The first set of activities — according to the DOL — were in the nature of public service, humanitarian and religious activities. The second set of activities were not. Taking each of these in turn and in the context of a small distillery, we can see how allowing “volunteers” to help WWW.ARTISANSPIRITMAG.COM

Artisan Spirit: Winter 2017  

The magazine for craft distillers and their fans.

Artisan Spirit: Winter 2017  

The magazine for craft distillers and their fans.