Twelve Guatemalan immigrants from the H-2B program are suing Imperial Nurseries and a labor contractor, claiming fraud and exploitation. A
U.S. Department of Labor investigation found Pro Tree Forestry Services, an independent labor contractor retained by Imperial, had not paid the legally required wage. Imperial claims it paid Pro Tree well in excess of what was needed to pay the employees in compliance with the law. Unfortunately, this situation isn’t uncommon. I asked Imperial attorney Monte B.
Lake about the situation, and how to deal with farm labor contractors.
Q. How common is the situation that arose with Imperial Nurseries and its farm labor contractor?
A. In the past it has been uncommon for a lawsuit to be brought on the basis of allegations that a farm labor contractor (FLC) and grower are engaged in illegal trafficking of workers or conduct that violates the Racketeer Influenced Corrupt Organizations (RICO) Act.
There is an increasing trend in this regard. It is not uncommon, however, for charges of federal and state wage and hour and Migrant and Seasonal Agricultural Worker Protection Act (MSPA) violations to be alleged against a FLC and the grower to whom the FLC provides workers.
Q. What’s Imperial’s stance on this issue?
A. As Imperial’s attorney I do not make a practice of commenting on cases in litigation. Imperial has issued press statements denying all of the allegations and stating that many of the claims in the lawsuit were investigated by U.S. Department of Labor (DOL) and were found without merit.
To the extent there are allegations that the FLC didn’t pay the workers properly and Imperial was informed of the allegation, Imperial worked with U.S. DOL to attempt to resolve the issue.
Q. Can employers be responsible for the illegal practices of a farm labor contractor?
A. The federal Fair Labor Standards Act (FLSA), the federal minimum wage and overtime law, as well as MSPA, include the principle of joint employer liability.
This means that a court can find the FLC and grower jointly responsible for any liability found under these laws. A determination of joint employment is made on a case-by-case basis.
The regulations and court decisions weigh these types of factors in deciding whether there is a joint employment relationship:
* Does the grower write the paychecks, pay insurance and taxes for the FLC’s workers?
* Does the grower have the direct or indirect power to control and supervise the FLC’s workers, including the power to hire and fire?
* Are the tasks the workers perform rote and integral to the farming operation?
* Is the work performed on the grower’s land?
* Does the FLC have other clients or work only for the grower?
* When totality of the above circumstances is considered, is the FLC economically dependent upon the grower?
Q. What’s your advice for wholesale nurseries wanting to work with farm labor contractors?
A. Nurseries that work with contractors need to understand at the outset that they could be found jointly liable for the contractor’s acts or omissions. Decide whether you want to try to establish an arm’s-length relationship and avoid such joint liability and, if so, care must be taken to avoid the above regulatory factors that show a close interrelationship between the two businesses and control by the nursery.
The other approach is to assume that you will be found to be joint employer and take steps to closely monitor the FLC’s activities (i.e., recordkeeping, tax compliance, payroll practices, transportation and housing health).
Micromanaging the FLC will result in a joint employment relationship and the grower must decide whether it is willing to trade off joint liability for a greater degree of control of the relationship.
Q. How difficult is it to participate in the H-2A and H-2B programs without dealing with farm labor contractors?
A. In my experience, most employers who use the H-2A and H-2B programs do not use FLCs. They recruit through newspaper advertising and by filing job orders with the Department of Labor, which circulates them to areas whether there are potential domestic farm workers, as required by DOL program regulations.
Q.What steps can you take to ensure you find a reputable farm labor contractor?
A. The first step is to make sure they are registered with the U.S. DOL. They are required to register to recruit, refer and hire workers, as well as be separately registered for other specific activities they may engage in such as transportation and housing.
If they have employees engaged in these activities, they must be separately licensed. In addition, some states have separate FLC registration requirements.
If you’re not sure, check with your state DOL and find out if there are any such requirements. States such as
California,
Florida and
New York have separate FLC licensing requirements.
Also, check with the local DOL regarding the reputation and compliance history of any potential FLC candidates. Ask for references from existing or former clients.
Finally, it is a good idea to have a written contract, setting forth the obligations, performance standards and requirements that the nursery has established for the relationship, cognizant of the fact that the terms of the agreement will have a bearing on the joint employment relationship described above.
Name: Monte B.
Lake.
Title: Attorney and certified labor-issues consultant for American Nursery & Landscape Association.
Firm: McGuinness, Norris & Williams,
1015 15th St. N.W.,
Washington,
DC20005; (202) 789-8600; fax (202) 789-1708;
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