Blackstone-owned plumbing company ordered to stop using child labor

A plumbing company owned by private equity group Blackstone has been ordered to stop child labor after federal investigators allegedly found workers as young as 13 employed at slaughterhouses in Nebraska and Minnesota, including some who suffered severe chemical burns.

In a federal court filing filed this week, the US Department of Labor said it had identified 31 children who worked at three slaughterhouses operated by sanitation company PSSI, which Blackstone has owned since 2018.

PSSI provides cleaning services at 400 meat processing plants and other industrial facilities, and officials said there was “reason to believe” similar violations “are occurring across the country”.

A federal judge on Thursday signed an injunction barring PSSI from using “oppressive child labor.” The judge also ruled that the plumbing company must not retaliate against employees who cooperate with government investigations.

Blackstone called any violation of PSSI’s child labor policy “totally unacceptable – as PSSI has made clear.”

During interviews conducted at the three slaughterhouses and local high schools described in the DoL’s file, children reported night shifts, which sometimes began at 11 p.m. and could last up to eight hours.

Conditions at the facilities were “steamy, noisy and wet,” investigators said, with limited visibility and extreme mechanical noise. According to investigators’ reports, some PSSI employees had to stand in a mixture of soapy water and floating pieces of meat while working.

Children interviewed by the DoL said their chores included cleaning bone saws, meat grinders and other heavy equipment, sometimes using harsh chemicals.

One student reported dropping out of high school after becoming exhausted from work. Another fell asleep in class, school records showed. Three minors who the government said were working at the factory said they suffered chemical burns.

PSSI said it has “an absolute company-wide ban” on employing anyone under the age of 18 and will “vigorously” defend itself if it does. It added that it carried out identity checks on new employees, although “rogues could of course try to engage in fraud”.

“We are also surprised that the DoL took this action,” the company added, citing “multiple audits with the agency that found no issues” and “extensive documents and responses” it had submitted to the government inquiry.

Blackstone is the world’s largest alternative investment manager with $951 billion in assets spanning real estate and debt mutual funds and debt-driven buyouts of companies like PSSI.

“The private equity industry can afford to be a responsible employer that provides safe and fair jobs,” said Jim Baker, executive director of the Private Equity Stakeholder Project, which tracks the impact of Wall Street investors on mass employment industries .

In court documents detailing their investigations, officials said PSSI managers engaged in “obstructional behavior” that impeded their investigations, such as:[ing] Eye contact with the respondents in the room”.

US District Judge John Gerrard, after hearing PSSI, will decide whether to extend his restraining order at a hearing scheduled for November 23.

https://www.ft.com/content/54ab001b-01b5-4e89-905e-73ad72431dec Blackstone-owned plumbing company ordered to stop using child labor

Adam Bradshaw

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