Farm Bill Spreads Seeds of Dissent

A farm labor bill that awaits its fate on Gov. Arnold Schwarzenegger’s desk appears simple on its face. But it underscores complex changes in California’s competitive agricultural economy.

The contentious legislation, which drew Democratic support and Republican resistance earlier this month, would require farm labor contractors to include on pay stubs the names and addresses of the growers whose fields their farmhands work.

That small change would help farmworkers track down growers when fly-by-night contractors cheat laborers and then disappear. Without that information, farmworkers often have no idea whose land they were on.

“It’s a very modest Band-Aid,” said Assemblyman Juan Arambula (D-Fresno), who worked the Central Valley’s fields as a child and carried the legislation. “The bill really is just an attempt to provide information to farmworkers so that they can pursue their legal remedies.”

Grower organizations are vigorously lobbying for a veto, contending the law would place undue administrative burdens on all labor contractors and could expose farmers to frivolous lawsuits.

“They are trying to go after ... the bad actors, and we are all for going after the bad actors and getting them out of business,” said Louie Brown, who represents a coalition of more than half a dozen grower groups fighting the law. “But their bill affects even the good actors.”

Schwarzenegger, who has until the end of the month to act, has not yet taken a position on the bill, a staffer said.

Regardless of the governor’s decision, the measure points to a sweeping transformation in the state’s agricultural labor force, about half of which is now brokered by independent contractors -- up from 20% two decades ago, said UC Davis agricultural economist Philip Martin.

Growers operating on thin profit margins clamor for the best deals on labor. Meanwhile, some contractors cut corners by fleecing their farmhands, undercutting the honest players and driving prices down.

Though nimble brokers have eased strains on farmers by matching them with ready-made crews on short notice, the trend has its downside. Noted Martin: “There’s a long history of labor contractors taking advantage of newly arrived workers.”

Still, though no one disputes this, regulators, worker advocates and farmers have disagreed on solutions.

Growers have sought to maintain an arm’s-length legal relationship from the labor contractors they hire, while encouraging them to play by the rules. Meanwhile, worker advocates have pushed legislation to compel growers to choose legitimate contractors or suffer consequences.

“We have a rampant underground economy in the industry, and we’ve been forced to try to create nontraditional remedies for these workers,” said California Rural Legal Assistance Foundation deputy director Mark Schacht, the architect of Arambula’s bill and others passed in recent years aimed at helping workers collect their wages.

“If the grower gets to skate when he has liability and he should have accountability, then he’s just free to keep repeating his practices of forcing contractors into low bids beneath the point where they can comply with applicable law,” Schacht said.

Existing law makes farmers liable when labor contractors cheat their workers under two conditions: If the grower knowingly hires an unlicensed contractor, or enters into a contract that he or she knows -- or should know -- is insufficient to cover minimum wage and other obligations such as Social Security and workers’ compensation.

The Arambula bill specifically notes that it assigns no additional liability to growers. Rather, proponents say, it merely makes their identity clear to workers so they could collect when growers are already legally on the hook.

A recent success is a case in point: Lemoore contractor Diversified Harvester Inc., whose license had expired, underpaid its laborers while they worked fields for Dole Foods, a lawsuit contends. Diversified paid by check, though some bounced, and included Dole’s name on pay stubs for bookkeeping purposes. Dole promptly settled and paid the workers.

“It’s not that hard to list the entity you’re doing the contracting with,” said California Rural Legal Assistance attorney Mike Meuter, who handled the case from the Salinas office, “and that ought to be a requirement.”

Third-party labor contractors in the garment industry are already required to include such information on pay stubs, proponents note.

But Brown, who speaks for the coalition that includes the California Farm Bureau Federation, Nisei Farmers League, California Citrus Mutual and Western Growers Assn., among others, called the measure an “administrative nightmare.”

Some farm labor contractors handle as many as 2,000 laborers at a time across California, some working for multiple growers in the course of a week. (Arambula counters that a simple change to an Excel spreadsheet can track those moves.)

Brown also complained that the bill would impose new civil liabilities on otherwise law-abiding licensed contractors, simply for not changing their pay stubs.

Furthermore, he said, a state-operated fund -- financed through fees on licensed labor contractors -- already exists to compensate field hands scammed by unlicensed contractors or to help workers when the bond on a licensed contractor is insufficient. Schacht notes that in recent years the fund has run out of money within months. Legislation just tripled its size, but it is still expected to fall short of demand, he said. Furthermore, he adds, why should the fund pay in those situations where growers are liable?

Regulators are circumspect, noting that many bad actors pay in cash.

California Deputy Chief Labor Commissioner Lupe Almaraz concedes that “there’s no question there are a lot of problems out there.”

“The more information any of us have, including the worker, the better,” Almaraz said. But “I am not sure it’s going to address the problem we’re having. We are dealing with people who aren’t getting check stubs.”

Even Arambula conceded that the bill would be of “marginal utility” unless broader measures were taken to dissuade growers from hiring shaky contractors.

But “it’s good government,” he said. “I hope it goes through.”

leora.romney@latimes.com