Del Monte Liable For Labor Contractor Wage and Hour Violations

By Michael C. Saqui and Anthony P. Raimondo

A federal court in Georgia has ruled that a subsidiary of Fresh Del Monte Produce is a joint employer with a labor contractor who provided farm workers to plant and harvest its fields by a federal court in Georgia. While the court has yet to address the underlying violations, the ruling means that if the plaintiffs prove their case, Del Monte will be responsible for any violations committed by the labor contractor. The key to the ruling was the claim that Del Monte knew that the labor contractor was undercapitalized and unable to independently sustain its operations.

The lawsuit was filed in April 2006 on behalf of foreign guest workers provided through the H-2A program, as well as domestic migrant farm workers who were recruited to work in the Georgia farming operations. About 500 workers in Del Monte's sweet onion operation there claimed that they were underpaid for planting, harvesting and packaging onions. Among the allegations are claims that the labor contractor failed to pay the Adverse Effect Wage Rate, the minimum wage required in the H-2A program.

COUNSEL TO MANAGEMENT:

Agricultural employers who utilize labor contractors must be sure to use reputable contractors, and must have appropriate written contracts in place. The grower should never underwrite the payroll, workers’ compensation, or other obligations of the labor contractor. It is important to keep in mind that the purpose of the joint employer is to hold growers accountable for their labor contractors, and the majority of cases result in a joint employer finding. Accordingly, it is critical that both parties in the relationship embrace compliance, and that both parties work together to ensure compliance.

The goal of this article is to provide employers with current labor and employment law information. The contents should not be interpreted or construed as legal advice or opinion. For individual responses to questions or concerns regarding any given situation, the reader should consult with Saqui & Raimondo at (831) 443-7100 in Salinas, or (916) 782-8555 in Sacramento.