Angelo Kelly, 39, was fined 3,000 euros (£2,600) by Hassfurt administrative court in Bavaria for the 2019 appearance at an open air summer concert with his son William, who sang What A Wonderful World.
The boy is the youngest of Mr Kelly's five children.
"During this performance, the child William stood for at least 30 minutes on the stage where he played along, sang along and interpreted his own song," the court said, according to the German dpa news agency.
"This is is considered work by the Youth Labour Protection Act."
Mr Kelly, who is popular in Germany, said on his Facebook page that he would appeal against the verdict.
"As a father, the well-being of my children is the most important thing for me," he wrote. "William was and is never obliged to appear with us at our shows. If he did it, it was because he wanted to."
Children aged three to six can take part in musical performances under German law for up to two hours a day, but only with official approval of an exception and only between the hours of 8am and 5pm, news agency dpa reported.
William, who is now five, appeared on stage until 8:20pm, according to authorities.
Mr Kelly's lawyer, Julian Ackermann, criticised the ruling, saying that interpreting a "brief appearance on the stage in the presence of one's mother and siblings at a concert given by one's own father" as child labour was legally wrong and "far removed from the facts".
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