By William Thornton
Companies producing most of America’s chicken products have met for almost a decade in Destin, Fla. to keep wages and benefits for their workforces at low levels, according to a lawsuit filed last week in Maryland.
The suit was filed on behalf of three former workers from Arkansas, but seeks class-action status for hundreds of thousands more. Most of the chicken processing industry cited in the lawsuit is clustered in the South.
The 77-page suit, basing its information on interviews with former employees, contends that the meetings have been going on since 2009 to keep wages and benefits for line and maintenance workers at about 200 plants depressed. The suit names several companies, including three divisions of Koch Foods based in Alabama, Decatur’s WSFP Foods, Tuscaloosa’s Peco Foods, Tyson Foods, Sanderson Farms, JCG Foods of Alabama, Wayne Farms, Perdue Farms and Pilgrim’s Pride Corp.
According to the lawsuit, the companies use consulting agencies as intermediaries to share wage information. Plant managers also cooperate. The yearly meetings, at Hilton Sandestin Resort Hotel & Spa, included “Directors of Compensation, Directors of Benefits, Compensation Analysts and/or Vice-Presidents of Human Resources from each of the leading chicken processors.”
The meetings in Destin would allow executives to exchange wage and benefit information, and fix wages and benefits. Costs for the “off the books” meetings were paid by companies on a rotating basis.
“During the Class Period, the compensation paid to Class Members was artificially depressed and left many of those workers in poverty,” the suit contends. “Many of the workers recruited and hired by Defendant Processors are migrant workers, refugees, asylum-seekers, immigrants employed under EB3 visas, prison laborers, and participants in court-ordered substance abuse programs.”
George Farah, a partner at Handley Farah & Anderson, one of the firms filing the lawsuit said working in a chicken processing plant is “grueling and extremely dangerous.”
“Under normal circumstances, chicken producers would have to compete for workers by offering higher wages and superior benefits,” Farah said. “Instead, these corporations have violated the antitrust laws to depress the compensation provided to their workers, leaving thousands of them in poverty.”
“We do not believe this suit has any merit,” Andrea Staub, a Perdue spokeswoman, told Bloomberg in an email. “Our compensation philosophy is to pay fair and in some cases above average wages.” Tyson, Wayne and Sanderson did not comment.
Poultry in Alabama generates more than $15 billion in revenue each year, according to the Alabama Poultry and Egg Association, and employs more than 86,000 workers on farms, processing plants and affiliated industries.