Lawsuit Alleges Chicken Farmer Misclassification

From The American Prospect, Claire Kelloway discusses a lawsuits that alleges that a corporation misclassified individuals who raised chickens as independent contractors when they were, for all practical purposes, employees.  Claire writes: 

Michael and Jean-Nichole Diaz wanted a farm business to pass down to their four sons. They ended up losing their life savings to get out of a dead-end chicken-growing contract. Now they’re hoping other contract poultry farmers will join their class action lawsuit, filed Monday, against one of the poultry corporations they worked with, Amick Farms.

Mr. and Mrs. Diaz allege that they were promised independence, but practically and legally were underpaid, unprotected chicken company employees, with little control over their operations and $1.5 million in debt on the line.

By arguing that contract poultry growers are illegally misclassified as independent contractors, the case highlights the ways corporations increasingly seek “control without responsibility” in the food industry and beyond. Corporations from Tyson to Amazon to port trucking firms have exploited changes in antitrust laws to push the riskier or labor-intensive parts of their supply chain onto “puppet entrepreneurs,” who take on all the risks of being a small business without meaningful independence.

Their suit argues that Amick illegally misclassified the Diazes as independent contractors when, for all practical purposes, it treated them like employees. This arrangement shifted all the risks of capital investments to the farmers without them having any say in key business decisions, like how many birds they received, how they cared for those birds, how they sold the birds, what kind of equipment they could buy, or even when they worked. Contracting denied the Diazes key labor protections that all employees receive, such as a minimum wage, sick days and holidays, and other benefits. According to the complaint, Michael and Jean-Nichole often each spent an average of 40 hours per week or more working on their farm, on top of Michael’s teaching job, and after paying for expenses they made “a fraction of the minimum wage per hour worked.”

The independent status of poultry contractors has been questioned before. In 2018, a report by the Small Business Administration found that contract poultry growers may not qualify for SBA loans because they looked more like corporate affiliates than independent small businesses. “We found integrator control exercised through a series of contractual restrictions, management agreements, oversight inspections, and market controls,” the report says. “This control overcame practically all of a grower’s ability to operate their business independent of integrator mandates.”

Read the full story at Lawsuit Alleges Chicken Farmer Misclassification – The American Prospect

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