According to a new lawsuit, companies producing more than 90% of America's chicken have conspired to depress wages for a largely immigrant workforce in some of the nation's most dangerous jobs. As reported by Bloomberg News, the lawsuit filed last week is mostly based on interviews with former employees and claims the conspiracy among 18 companies, their subsidiaries, affiliates, and two consulting firms continues to this day. The lawsuit, filed on behalf of three former workers, is now seeking class-action status for hundreds of thousands of workers, many of whom are immigrants or aliens.
Since 2009, leaders of the firms’ human resources and compensation departments have held annual secret meetings at a Destin, Florida, hotel to discuss pay and benefits for line and maintenance workers at about 200 plants, according to the complaint in Baltimore federal court. Using consulting agencies as intermediaries, the suit says, they share detailed wage information. Plant managers also cooperate, for example calling each other when one announces an expansion to find out what new positions will pay, the lawsuit says. In addition, this is not the first time the U.S. chicken industry has been on the receiving end of legal scrutiny, in 2016 a class-action lawsuit filed by Maplevale Farm, a food distributor, accused the industry of price-fixing. Lawsuits from consumers, distributors, grocery chains and food companies followed, and this summer the Justice Department intervened.
The new litigation targets 18 processors including Tyson Foods Inc., Sanderson Farms Inc., Mar-Jac Poultry Inc., Wayne Farms Inc., Perdue Farms Inc. and Pilgrim’s Pride Corp., their subsidiaries and affiliates, as well as Agri Stats and Pennsylvania consultant Webber, Meng, Sahl and Co. Inc. The suit, which seeks unspecified damages, is about more than money, said the lead plaintiff attorney. “These workers are some of the most vulnerable workers in the United States,” George F. Farah, a partner at Handley Farah & Anderson PLLC, a Washington-based firm that pursues cases against corporations on social-justice grounds. “I can’t think of a more important case I’ve pursued in my entire career.”
Chicken is the country’s most popular and cheapest protein: Americans will eat an estimated 94.3 pounds each in 2019, according to the National Chicken Council, and they will pay only $1.90 a pound. Preparing all that meat is dirty and dangerous. Poultry workers suffered occupational illnesses at a rate five times higher than other U.S. workers in 2013, according to a 2015 Oxfam report, and 72% reported significant work-related illness or injuries. According to an industry report, finding people willing to do the job has become a challenge, and tougher immigration enforcement has made that even harder than usual, of course, the report seems to leave out the industry's artificially depressed wages, likely a large cause of the problem.
On Aug. 7, federal agents raided seven Mississippi plants, arresting 680 unauthorized workers. Under President Donald Trump, who ran on limiting legal immigration and forcibly removing illegal aliens, work-site investigations by U.S. Immigration and Customs Enforcement surged to 6,848 in fiscal 2018 from 1,691 the year before. President Trump praised the Mississippi raids as a “good deterrent.” The defendants in the new case have employed hundreds of thousands of workers, according to the complaint. A laborer may be exposed to live animals, sharp knives, repetitive motions, and a litany of other dangers. Wages average about $11 per hour, keeping employees near or below the poverty line, Oxfam found.
Most of the country’s chicken comes from a concentrated region in the Southeast. Plants are so near that each company owns and operates a chicken processing plant that is within 28 miles of a competitor’s processing plant, according to the suit. That should make the labor market competitive, with workers able to move to the employer that pays best. Instead, the would-be competitors collude, according to the suit. “As a pure antitrust matter, it looks really strong, like there was a pattern of coordination in shared control over wages,” said Peter Carstensen, a former antitrust lawyer for the Justice Department and a University of Wisconsin law school professor.
The scheme began in 2009 or even earlier, according to the filing. Executives in charge of human resources, compensation and benefits would meet at 'off the books' meetings in Destin, often around the same time as an annual human-resources seminar held by the U.S. Poultry & Egg Association. The sessions didn’t appear on published schedules, according to the suit. Senior executives of the accused companies chastised rivals that had deviated -- by making unauthorized increases to worker compensation -- from agreed-upon wages that had been fixed at prior in-person meetings, the suit alleges.
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