I know how immodest this sounds, but I really am a legendary finder of secondhand bargains. In the column that has become a Christmas Eve tradition, the Arkansas Democrat-Gazette’s John Brummett waxes nostalgic about the vintage silver Christmas tree that I spotted at an estate sale. When PR maven Natalie Ghidotti interviewed me for her podcast series, she made a point of talking about my “Craigslist Find of the Day” posts on Facebook. You’d be amazed how many buyers and sellers I have brought together.
My bona fides as a champion for resale are indisputable. I’m on a first-name basis with most of the estate sale operators in central Arkansas, and most of the furniture in our house was previously owned by someone else. My eye-popping fuchsia coat — 100% camel hair with an M.M. Cohn label from the 1980s — set me back $7.50, plus the cost of dry cleaning.
This is an Opinion
I run into all kinds of people at estate sales — including prominent names like Ray Hanley, Rosi Smith, Johnny Key, Rita Sklar and Barbara Graves. Some shoppers are dealers looking for underpriced items to resell at a profit online or in booths. Some are filling out personal collections. Many are young people furnishing their homes with quality used items for less than the price of new pieces they have to assemble themselves.
It’s these smart young families who are the target market for Rhea Lana Inc., the Conway operator and franchisor of consignment sales for secondhand children’s clothing, toys and gear. I interviewed founder Rhea Lana Riner for a story that appeared in last week’s edition because I was fascinated by her long, losing battle with the U.S. Department of Labor. No matter how I tried, I couldn’t figure out why the DOL felt the need to mess with Rhea Lana’s business plan.
You probably know the basics: For years Riner offered her consignors the opportunity to shop her sales first in exchange for putting in a few hours helping organize and operate the sales.
The DOL determined that these workers — almost exclusively women — were not legally volunteers since they were promised something of value in exchange for their labor. And there can be no dispute that first crack at one-of-a-kind bargains is a valuable thing. It’s why people line up outside estate sales.
The government concluded that these sale workers were employees who should be paid at least minimum wage. A federal district court in Washington, D.C., and the D.C. Circuit Court of Appeals both agreed with the DOL, which applied the precedent the U.S. Supreme Court laid out in its 1985 ruling against the Tony & Susan Alamo Foundation.
So Riner and her scores of franchisees had to change their business plans. Instead of recruiting volunteers from among the consignors to work five, 10 or 15 hours once or twice a year, Riner personally hired 150 short-term employees to work her fall sales in Conway and Little Rock. Her franchisees are hiring and paying employees as well. To pay them minimum wage, the consignment sale operators have raised their commission on merchandise sold from 30% to 35%, and they are selling tickets for first-choice shopping.
It’s working fine for Riner and the Rhea Lana’s franchisees. Anyone who has tried to wrangle volunteers could not be surprised to learn that paid employees are easier to manage. There are fewer of them, and they are easier to schedule since they are required to work at least eight hours rather than the shorter shifts that the unpaid helpers could sign up for. And, Riner said, she was pleasantly surprised by how many people were grateful for even such short-term employment.
So all’s well that ends well. But I still don’t understand what the fuss was about. Unlike the Alamo cult members, who worked 60 to 100 hours a week in exchange for room and board, Rhea Lana workers gave up only a few hours of their lives no more than twice a year. There doesn’t appear to have been a single complaint from a woman who swapped labor for the chance to get the pick of the bargains. No one was abused or taken advantage of.
I came to the same conclusion as Riner: The losers are the consignors, who keep less of the residual value of their resale merchandise, and especially those who were willing to put in a few hours of work in order to shop early.
One of the Appeals Court judges who considered Rhea Lana Inc.’s appeal suggested that the unpaid workers could be independent contractors rather than employees or volunteers. That, Riner said, was “a fight for another day.”
Email Gwen Moritz, editor of Arkansas Business, at GMoritz@ABPG.com and follow her on Twitter at @gwenmoritz.