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The Modern Workplace

Fields of Dreams: Small Agricultural Employers Seem to Think the Law Doesnt Apply
When I'm not lawyering, I like to spend time around horses. That sometimes means spending time observing the habits of horse barn owners and other operators of small agricultural facilities. For an employment lawyer, its scary out there on the farm. If you read the help wanted ads on horse industry list serves and web sites, or peruse the bulletin boards at feed stores, or talk to stable and farm owners, you'll quickly conclude that unlawful employment practices are common and that compliance is not a big concern.
Agricultural workers and non-agricultural workers are treated differently in certain ways under the laws of most states, but the differences are very limited. Maybe the differences that do exist are the source of the casual attitude that small agricultural employers seem to have about employment laws. Or maybe the employers assume that enforcement authorities will not be interested in a barn owner with only a few employees. Whatever the reason for their inattention to the law, these employers are putting themselves at risk and, in some cases, mistreating their workers.

Here are some of the most common violations I've observed:

I pay cash. Employers have to report wage payments to state and federal authorities, and usually have to withhold taxes and pay taxes. Unreported cash payments for labor are usually unlawful, and that goes for small agricultural employers and big corporate employers alike.  

I only hire independent contractors. Calling someone an independent contractor doesn't make them one.  Whether or not a worker is an independent contractor or an employee is a legal determination that is based on a number of factors.  Treating a worker as an independent contractor when he or she should be treated as an employee can result in significant legal liability for an employer, including fines, penalties, and back taxes. Click here for an earlier post on this issue.

$50 a day.  Wage and hour laws, including minimum wage laws and laws relating to overtime pay, apply to many agricultural employment situations.  Agricultural employers cannot ignore wage and hour laws without risking significant penalties, even if workers are willing to accept a daily pay rate.

Ill find myself a hard-working Mexican.  I must confess that I was astonished the first (and second, and third) time I heard a farmer or barn owner say something like this. It is apparently common practice among some agricultural employers to seek out workers who may or may not be authorized to work in the United States, who are grateful for any work they can find, and who will agree to work long hours for low pay.  These workers are often Hispanic, always paid in cash (see above), may not receive minimum wage (ditto), certainly don't receive benefits, and its assumed that they aren't likely to complain about anything because of their immigration status.  Common practice or not, everything about this is wrong, and the employer who engages in this sort of hiring is breaking the law.

Strong young man needed for handling horses. Discrimination laws apply to every employer who hires one or more employees (except when hiring a family member). Small agricultural employers are not exempt from the laws that prohibit discrimination in hiring based on gender, race, disability, age, religion, sexual orientation, disability, and other protected class status. There is nothing about agricultural work that changes an employers obligation to maintain a hiring system and a workplace free of discrimination.

Working student wanted. Particularly in the horse world, it is common practice for riding students to work in exchange for lessons or a chance to ride an instructors horses. The work includes all sorts of labor around the barn, as well as exercising and grooming horses. That may be fine with the student and the instructor, but it may run afoul of wage and hour laws. As discussed in this Department of Labor fact sheet,internships in the for-profit sector will most often be treated as employment under the law.

I don't need workers comp or unemployment insurance. This may or may not be true. Some but not all family farms are exempt from the requirement to carry workers compensation and unemployment insurance, and the exemptions depend on complicated factors. In some states, including Minnesota, horse breeding and training operations - even if they qualify as a family farm -  are specifically not exempted from workers compensation insurance requirements. Agricultural operations that aren't family farms usually don't qualify for exemption. In short, the law in this area is complicated, and its a big mistake for an agricultural employer to assume that insurance isn't needed.

Sometimes it takes a discrimination charge, wage and hour audit, IRS inquiry, or workers compensation claim to get an employer to pay attention to the law. Here's hoping that the barn owners and farmers I've been observing and reading about don't have to find out about employment law the hard way.
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The information contained in this post is provided to alert you to legal developments and should not be considered legal advice. It is not intended to and does not create an attorney-client relationship. Specific questions about how this information affects your particular situation should be addressed to one of the individuals listed. No representations or warranties are made with respect to this information, including, without limitation, as to its completeness, timeliness, or accuracy, and Lathrop GPM shall not be liable for any decision made in connection with the information. The choice of a lawyer is an important decision and should not be based solely on advertisements.

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