Apr 9, 2015

Piece-rate ruling could cost Washington growers millions

A legal case involving paid rest breaks for piece-rate workers could have “catastrophic” consequences for Washington state growers if the court rules against the defendant, said Dan Fazio, director of WAFLA, a services provider for farm employers in the Pacific Northwest.

Fazio said that the legal case has already cost the defendant, Sakuma Brothers Farms in Burlington, Washington, more than a million dollars (counting attorney fees). If, as a result of the case, the Washington Supreme Court decides to change the state’s piece-rate law retroactively, agricultural employers might have to pay for worker rest breaks going back three years. Fazio’s “back of napkin” calculation is that a retroactive ruling could cost Washington growers more than $100 million.

The legal dispute started in October 2013, when Columbia Legal Services and the law firm Terrell Marshall Daudt & Willie filed a lawsuit against Sakuma. There were two named plaintiffs in the lawsuit, representing dozens of migrant and seasonal piece-rate berry pickers hired by Sakuma. The lawsuit listed a series of complaints from the workers, including complaints about not being paid for time worked, not being paid the minimum wage, not getting rest breaks and poor working conditions. The lawsuit claimed that Sakuma violated both federal and state worker protection rules, said Marc Cote, lead attorney for the plaintiffs.

The case went into mediation last year, where a settlement was reached on every claim but one. The U.S. District Court for the Western District of Washington approved the settlement last November. Sakuma admitted no wrongdoing, but agreed to pay $850,000 in worker claims, expenses and legal fees, Cote said.

The one issue that was not part of the settlement involved paid rest breaks. According to Washington state law, employers are required to provide their employees a 10-minute, paid rest break for every four hours worked. In the settlement talks, Sakuma had agreed to provide rest breaks but not to pay for them, Cote said.

Sakuma’s attorney, Adam Belzberg with Stoel Rives law firm, had a different interpretation. The claim that piece-rate workers are not being paid when they’re taking rest breaks is misleading, he said. With piece-rate workers, or any other workers paid on a commission basis, it’s always been the case that the payment covers everything that goes into producing the piece. In the Sakuma case, the piece rate covers not only the act of picking the berry off the bush, but the time it takes to fill the bucket, separate the poor-quality fruit – and take a 10-minute rest break every four hours.

Fazio said paying piece-rate workers separately for rest breaks would amount to “extra pay.”

Belzberg said the question over paid rest breaks is a “lawyer-created issue.” He thinks activist and “union front” groups are ultimately behind the lawsuit, and that they’re targeting Sakuma for using the H-2A program in 2013.

Since the rest-break disagreement is a question of state law, the federal court requested that the Washington Supreme Court make a ruling. Both sides made oral arguments before the state court in March. The question now before the court, according to Cote, is this: Under state law, do employers have to pay piece-rate workers separately for their breaks? And if so, what does the rate of pay have to be?

Cote said the court might make a decision by autumn, but it’s hard to predict.

If the court ends up ruling that agricultural employers must pay their piece-rate workers separately for rest breaks – and decides to apply its ruling retroactively – the decision could have a “huge impact” on the way agricultural employers pay their workers, and whether or not the piece-rate system will continue to be used. On top of that, such a ruling could impact other industries in the state that use a non-hourly payment system. The case is being closely watched around the country, Belzberg said.

– Matt Milkovich