Earlier this month the state of  Illinois passed a first-of-its-kind legislation, which would ensure that minors that are featured in online content are guaranteed a portion of the profits that is generated by the content. 

The law that was passed by Illinois officials is an amendment to the state’s existing child labor laws. The Amendment states that influencers, under the age of 16, are entitled to a percentage of their earnings for any work they have been featured in online content such as videos. The money will be allocated to a trust where about 50% of the revenue will be distributed to the trust. Pennsylvania is also looking to implement similar amendments regarding child labor and the content created by them.

These laws are in conjunction with the already established “Jackie Coogan’s Law”, which was enacted in 1939 and was originally designed to prevent the parents of the child from exploiting their child’s earnings – which were established after one child sued his parents for exactly that.

A brief background of the 1939 Coogan Law

In 1921, Charlie Chaplin released a film by the name of The Kid and is considered to be the first child actor in Hollywood due to his role in the silent film. After this, he was featured in many other films and had a production house set up in his name by his parents. 

Coogan was given a daily allowance of $6 throughout his childhood and once he became older he lost interest in the industry and no longer wanted to pursue his movie career. That being said, when he became an adult he just wanted to receive the rest of his money and start a new chapter in his life. Upon asking his parents about his earnings from his work in the movie industry he learned that there was only a little bit of his money left. He subsequently took his mother and his stepfather to court for spending the vast majority of his earnings.  

During this time there wasn’t any specific law in place that could help him reclaim his money. Because of this, he was never able to recover the 4 Million dollars he was owed. Instead, the price of the settlement dropped to around $250,000  by the time the case was completed and he was only able to recover half of that amount. 

Though Jackie may have not gotten the outcome he wanted, his case set a precedent within the legal system which was the beginning of legislation and laws being put into place to protect child performers from their parents and legal guardians from their earnings.

Though the laws have helped children by deterring parents and guardians from looking to take advantage of a situation, there are loopholes within it that people have exploited. This is why there have been many adjustments to the laws over the years. For instance, the mothers of both Judy Garland and Elizabeth Taylor used the title of chaperon or manager to pay themselves quite well while working within the law. 

As it stands the current law states that a minimum of 15% of all earnings must be set aside for the child, which comes from the child actor’s gross income, not the net income, which is how they are now protected from parents trying to pay themselves under the guise of a chaperon or manager.

What Does the New Law Mean?

Now Illinois is the first state to make a change to the current child labor laws. Earlier this month Governor J.B. Pritzker signed new legislation into law that intends to amend the state’s current child labor laws to ensure that the children influencers and other social media entrepreneurs under the age of 16 will be entitled to a percentage of the money they generate.

Under this new legislation parents and guardians are meant to allocate a percentage of their child’s gross income, which the child can access when they turn 18. This ensures that kids won’t be subject to being taken advantage of, financially, by their parents and if so, they will have an avenue to sue them for any wrongdoing.

This law in particular applies to videos filmed within the state and to any minors that have been featured in 30% of the content within 30 days. The percentage is also based on the total time that their likeness, name, or photograph is featured and based on the number of times their name is mentioned in the narration.

The senator of Illinois Dave Koehler stated that the lack of protection for children’s social media stars and influencers gives parents full access to take advantage of the child’s success and pocket the money that the child earns, which can be a substantial amount of money.

Koehler had stated that he initially got the idea for the legislation from a 15-year-old constituent by the name of Shreya Nallamothu, who had voiced her opinions on the matter and believed that the child influencers were being taken advantage of by their parents or legal guardians. In a statement that was given to Koehler and his office, Shreya had stated that it was important to “Protect the money that these kids have rightfully earned”.

The Legislation that was signed in May was initially started as a school project by Nallamothu. The teenager investigated the lack of protection for children who are social media influencers from across America. After she had given her presentation she was encouraged to share her findings with the state Senator to influence change, and her research did just that and was able to fuel the legislation for child labor laws.

This isn’t for no reason either, the kid-influencer content has become a massive industry and is a part of the massive social media influencing market, which is worth somewhere north of $21 billion. 

CBS investigators found that child influencers have millions of followers across multiple platforms and are generating hundreds of thousands of dollars in advertising and affiliates per month. A perfect example of this is Ryan Kaji who earned roughly 27 million in 2021 alone and Nastya, an eight-year-old Russian child who focuses on toy unboxing earned roughly $28 million.

A few other states have been taking notice and looking to implement protective measures for children influencers as well. California leading the way by amending an already existing child labor laws several years prior. Washington state is also looking into similar legislation for children in their state as well, with the influence of Illinois. The bill did stall this year but is expected to be pushed through and implemented in December.

As of now the legislation being pushed in Washington may go a step further than the one passed in Illinois. If everything goes as planned and there are no changes the child will have control of their content and can request the content be deleted once they reach the age of 18. This requirement was in the original legislation for Illinois as well but was taken out of the final Bill.

Key Takeaways: The child influencer economy

• Child influencers have to feature in at least 30% of any content, over thirty days, to make a claim for a percentage of earnings according to the new Illinois law. 

• 10 cents per view is the minimum amount when it comes to online content and the earnings it generates, for children to be able to claim a payout. 

• According to a recent report from Morning Consult, 86% of young Americans who were surveyed stated that they’re interested in becoming influencers and leveraging their social media to create an income. This same report showed that at least 12% stated that they already considered themselves part of the influencer economy. 

• According to recent data, child influencers can earn an income ranging from a couple of hundred dollars to over $20,000 per sponsored post.

Who are they?

To clarify, kidfluencers are children who you might come across in featured posts, advertorials, websites, and all forms of digital content. Their purpose is to make the content and brand they’re representing stand out and increase sales. This includes, but is not limited to:

• Family vloggers who have YouTube channels or other forms of social media. Whereby the kids are framed as the stars of the show. All sponsored brand partnerships that occur with the child involved are subject to the new Illinois law. 

• Children who have their own personal social media accounts, that are managed by parents. 

This move by Illinois to protect child stars comes during a time when the debate on whether or not children can consent to having their photos and videos shared online is at the forefront of popular discussion. The main argument claims that parents are oversharing and going against a child’s right to privacy.

This same discussion already fueled legal changes in France, with the sole purpose of protecting child influencers and ensuring they are being remunerated fairly for their efforts. 

In 2021 France implemented a law that intends to protect “influencer “ children on platforms such as YouTube TikTok, Instagram, etc. This is in conjunction with laws that are already in place for industries that children work in such as but not limited to modeling and acting, under the Labor Code. Under this law only a part of the child’s income will be paid to the child’s parents, the other balance will be placed in a special savings account that will be accessible to the child once they are of legal emancipation or adulthood.

This French law also allows the children to assert their “right to be forgotten”. This means that video platforms are legally required to delete the entirety of the child’s content that they were featured in upon request without consent from their parents or legal guardians.

Conclusion 

Interestingly, the spike in child influencers has led us to a dark side of the industry where there are now economic and ethical concerns surrounding it to the point of the government needing to get involved. The amount of money that is now being thrown at influencers at a young age has now been the subject of debate when it comes to parental control, financial responsibility, and ultimately the rights to their earnings. With states like Illinois stepping up and making mandatory requirements for the guardians or parents to set a percentage of money aside for the child when they come of age, there is some more stability in the industry. This legislation and press also bring eyes to this otherwise overlooked aspect of child social media influence, and will now be more regulated because of it.

Furthermore with California digging in its heels and amending passed child labor laws to adapt to new technological advancements in social media we can see a landscape shifting towards protecting all parties involved and giving the space more structure and legitimacy. With other states like Washington also looking to help protect children from being taken advantage of financially we can understand how the industry is evolving at a rapid rate and legislation needs to be adapted not for the problems of today but the problems of the future. This means protecting the people who are ultimately going to live in the future, kids.

It is no mistake that it took a child’s research for a school project to bring this big problem to light. With more like-minded people similar to Shreya Nallamothu seeing and analyzing social developments with business structures within social media, we can have the foresight necessary to protect future children from people looking to exploit them for personal gain.

As this industry inevitably continues to grow at a rapid rate, influencers along with e-commerce, technology, and child protection will in large be a massive topic of concern within the industry. With so many moving pieces it will be hard to get it right on the first try and with many updates to platforms that release new features in which users can monetize it brings many challenges to the subject. That is why it’s important to keep these landmarks as reminders of what can happen if we aren’t continuously looking out for one another’s best interests and placing roadblocks to protect the most vulnerable class of citizens in society.