Opinion: Blueberry hostages: Did the feds go too far in enforcing labor laws?
The federal Department of Labor has for decades used a little-noted enforcement tool to compel employers to observe laws governing minimum wages, overtime pay and child labor. The enforcement tool is known at the “hot goods” provision of the Fair Labor Standards Act, which lets the Labor Department bar an employer from selling or shipping goods out of state that were made by workers that the employer has wronged.
It’s a powerful tool. Invoking the provision has made negotiated settlements with the guilty move much more quickly. In cases of claims in which the employer contests the findings, the Labor Department has lifted the “hot goods” hold in return for an escrow payment equal to the amount of back wages in contention.
Two years ago, though, the Labor Department pursued cases against three Oregon blueberry growers -- PanAmerican Berry Growers, B&G Ditchen Farms and E&S Farms -- in which it seems to have overstepped the bounds of common sense, and due process. (FairWarning.org has a good overview here.)
Labor investigators accused the growers of underpaying blueberry pickers, among other sins, and sent them a notice in August 2012 that they would invoke the “hot goods” provision, which meant that millions of pounds of ripening berries would not be able to reach market. The only way to get the block lifted: Sign a consent decree, which included a pledge that the growers would not contest the Labor Department’s findings that it owed $240,000 in back wages and penalties.
The three growers signed. But a year later they went to court accusing the federal investigators of fraudulently using the “hot goods” provision to deny them access to due process. In a series of court rulings, federal judges agreed, though the legal scramble continues.
That’s where the issue belongs -- in court. But this, predictably, has prompted some significant backlash, including a proposed law by Oregon Democratic Rep. Kurt Schrader and others that would limit the Labor Department’s use of the “hot goods” provision to nonperishable goods.
That’s the wrong reaction. It’s clear the Labor Department misused the “hot goods” provision and needed to be reined in. For some 70 years it has used the mechanism properly, bringing abusive employers into line while respecting their right to legal appeals. Traditionally the department has lifted the shipping hold in return for a payment into an escrow account pending legal resolution. If the feds prevail, the workers receive their owed pay. If the employers prevail, they get their money back. Everyone is protected and workers rights’ are defended.
In this instance, though, the government didn’t put the growers’ payments in escrow, but passed them along to the workers (those they could find among that highly transient population). More troubling, though, was the investigators’ strong-arm tactics, which forced the growers to accept a finding of fault which the growers felt was unsupported by the facts (it hinged, in part, on conflicting analyses of how many pounds of blueberries a picker might harvest in a day). But by holding hostage the perishable blueberry crop, the Labor Department wrongly denied the growers the right to appeal to the courts.
But it would also be wrong for Congress to try to strip that otherwise effective labor rights enforcement tool from the Labor Department over this misuse. Given the power imbalance between employers and workers, especially in an era of weakened unions, this is an important safeguard against abuses. Congress should leave it alone. As the court rulings indicate, the system worked here, even if the Labor Department overstepped.
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