My wife asked me tonight if the idea of bone-crushing labor was a reference to the English workhouses of the 19th century. On of the jobs reserved for the poor was to crush and grind bones into fertilizer. Although it turns out that the phrase has nothing to do with such labor, it did turn me on to this more interesting event that took place in 1846.
In 1834, the Poor Law Amendment Act was passed in England to help create a standardized workfare system in England. According to Wikipedia, the work was meant to be miserable, so as to discourage the able-bodied from relying on the government dole. Workhouses sprung up all over England to provide bone-crushing labor opportunities (both literally and figuratively).
In 1846, the House of Commons opened and investigation into the Andover Workhouse. Conditions in the workhouse were beyond deplorable; female workers were sexually abused, and paupers were locked in the mortuary as punishment. One revelation was that the workers would fight over scraps of decayed meat that were rotting on the bones they were meant to be grinding. One reform of this investigation was that the process of bone crushing was banned in the workhouses.