Labor Relations in California Agriculture: 1975-2000 -- Philip Martin
October 4, 2000
Version of September 20, 2000
California has had large and specialized farms dependent on migrant and seasonal workers since it became a state in 1849. The two most important dates in early California agricultural history were 1869, when the transcontinental railroad was completed, lowering transportation costs and encouraging crop production that required seasonal workers, and 1882, when the state's fledgling labor-intensive agriculture was challenged by the Chinese Exclusion Act. Having workers willing to wait at their own expense to fill seasonal jobs because discrimination kept them out of urban labor markets raised land prices, and gave farm employers an incentive to preserve access to what Varden Fuller called an "unAmerican" labor supply.
Most farm organizations wanted to transplant Iowa to California, to develop a system of family farms--meaning that most of the farm's work was done by family members--to create what they considered viable rural communities. Thus, stopping Chinese immigration was welcomed by those who thought that using government policy to change the farm labor supply would in turn change the size and specialization of farms. However, waves of other immigrants willing to accommodate to sesaonality because they had few other US job options became available--Japanese in the 1890s and early 1900s, Mexicans in the 1920s, Dust Bowl migrants in the 1930s, and Mexicans since the 1940s--so that labor supply changes did not force structural changes in agriculture.
Federal policy toward farm workers almost changed in the 1930s. Farm workers were excluded from the National Labor Relations Act of 1935, the Social Security Act of 1935, and the Fair Labor Standards Act of 1938. However, a series of books and reports on farm labor in California in 1939-40 set the stage for treating at least the largest US farms like nonfarm employers. The US Senate's Education and Labor Committee subcommittee chaired by Robert LaFollette (R - WI), provided the record to argue that farms in California were akin to farm workers, and John Steinbeck's novel, The Grapes of Wrath, added an emotional touch to the calls for farm labor reforms.
Instead of reforms, World War II gave farmers the labor shortage argument they needed to win permission to recruit Mexican workers, laying the ground work for contemporary Mexico-US migration and the dominance of Mexicans among farm workers. Under a series of so-called Bracero (strong arm) programs that began as a war time emergency in 1942, between 1 and 2 million Mexicans gained experience working on US farms.
As with many guest worker programs, the number of Braceros got larger and the program lasted longer than expected. Admissions peaked in the mid-1950s, when almost 500,000 Braceros were admitted each year. Over the objections of US farmers and the Mexican government, the Bracero program was ended unilaterally by the US in 1964, amid predictions that US fruit and vegetable prices would skyrocket and that the nonfarm US workers employed to transport and process the commodities harvested by Braceros would be left jobless as labor-intensive crop production shifted to Mexico.
Predictions about how agriculture would adjust to the end of the Bracero program proved to be false. Instead of shifting to Mexico, fruit and vegetable production rose as US demand expanded with higher incomes and more health-conscious Americans, and mechanization reduced the need for hand workers in many commodities. The absence of newly arrived workers without other US job options enable the fledgling United Farm Workers (UFW) union to win a 40 percent wage increase for some table grape pickers in 1966, raising the minimum wage under UFW contracts from $1.25 to $1.75 an hour at a time when the federal minimum wage was $1.25 an hour.
Farm wages rose rapidly between 1965 and 1980, as the extension of federal and state labor laws and protections to farm workers, union activities, and relatively few newly arrived immigrants led to a construction-style labor market in some commodities and areas, marked by high hourly and weekly earnings when seasonal work was available, and maximum unemployment insurance payments when work was not available. The UFW, seeing the hiring halls of the construction and maritime industries as models, wanted union-run hiring halls to be the major organizing device in the farm labor market, that is, farmers would transmit their requests for seasonal workers to a UFW-run hiring hall, which would then dispatch workers to fill the job. Under such a system, worker seniority and benefits could be tied to the union, not to the farm on which a seasonal worker happened to be employed.
The UFW's high water mark came in 1973, when it claimed 180 contracts covering 40,000 farm jobs and 67,000 members, a ratio of 1.7 members per job. Some farmers became convinced they would have to deal with some union representing their workers, and many expressed a preference for the Teamsters--in the absence of a labor relations law, farmers could switch their union representative without elections.
This changed on August 28, 1975, when California's Agricultural Labor Relations Act went into effect. The ALRB, with a $1.5 million budget, was very busy in its first five months after the first election was held September 5, 1975 at the Molera Packing Company near Salinas. After five months of operation, the ALRB reported that by the end of January 1976 it received 604 election petitions, or an average 4 a day, and conducted 423 elections involving over 50,000 workers; objections were filed in 80 percent of the elections. The ALRB received 988 ULP charges in its first five months of operation, almost 7 a day, and issued 254 charges, or almost 2 a day. Beginning with Eugene Acosta et.al. (1 ALRB 1), the Board issued 27 decisions in its first year of operation. After failing to get a supplemental appropriation of $3.8 million, the ALRB closed between April 3, 1976 and June 30, 1976.
The UFW won most of the first elections held in the late 1970s, and had 108 contracts with an average entry level hour wage of $3.38 in 1978, a time when the federal minimum wage was $2.65 an hour. In January 1979, the UFW called a strike in support of a demand for a 40 percent wage increase in the vegetable industry, from a minimum $3.75 to $5.25 an hour. The strike contributed to reduced lettuce production and higher lettuce prices. Imperial county, for example, normally sent about 10 million cartons of lettuce to market in February at a price of just under $4 a carton for total revenues of almost $40 million. In February 1979, only 7 million cartons were marketed, and the price was over $10 a carton, for total revenues of $70 million. The strike was settled with some growers in summer and fall 1979, with minimum wages under union contracts rising to $5 or more at a time when the federal minimum wage was $2.90, i.e., some farm workers under union contract were guaranteed almost twice the federal minimum wage. Several commentators noted that the UFW was able to use the strike " to win wage parity with industrial workers." (Business Week, March 5, 1979).
The minimum wage under UFW contracts continued to increase in the 1980s, but the number of contracts declined. According to contracts in the UCD farm labor contract collection, the minimum wage in UFW contracts peaked at $6.20 in 1985, when there were 28 contracts (the federal minimum wage was $3.35 an hour). The number of UFW contracts has remained in the 25 to 50 range since, and the minimum wage guaranteed under UFW contracts in effect in 2000 ranges from $7 to $8; the federal minimum wage in 2000 is $5.15, and the state minimum wage is $5.75.
The 1979 was described as a Pyhrric victory for the UFW because (1) many growers learned they could use labor contractors and custom harvesters to obtain newly arrived immigrant workers, especially after the Mexican peso was devalued in 1982, and (2) some of the companies such as Sun-Harvest that signed contracts offering higher wages went out of business. Unions hoped that the Immigration Reform and Control Act of 1986 would usher in a new era in farm labor, as legalized workers would be more willing to demand wage and benefit increases and employers would be encouraged by market forces-no more unauthorized migration-to grant them.
About half of the 1.2 million foreigners legalized under the Special Agricultural Worker program were legalized in California. However, illegal immigration continued at high levels and California experienced a recession in the early 1990s, so that the farm labor market was often described as "flooded," and there were more cases of wage and benefit cuts then increases. (Martin and Taylor, 1990; CAW, 1992). Instead of voicing the need for change via the unions, most legalized farm workers exited the farm work force for nonfarm jobs. They were replaced by newly arrived and often unauthorized workers, so that, in 1996-98, an estimated 52 percent of California crop workers were believed to be unauthorized.
Most farm employers, even in California, are relatively small; their inclusion in regularly published data obscures the concentration of production and employment on the largest farms. In most commodities, the 10 largest of 500 to 1,500 growers account for 30 to 60 percent of total employment. However, the major source of detailed farm employment data, the Census of Agriculture, groups labor data in categories that mask this concentration. In 1997 the COA reported that 36,450 California farms hired 549,265 workers-a worker hired on two farms was double counted. The 9,500 farm employers who hired 10 or more workers accounted for 85 percent of the workers hired in California, i.e., 26 percent of farm employers accounted for 85 percent of workers hired. More detailed data would show that the largest 500 to 1000 farm employers accounted for 50 to 75 percent of these hires.
Many of the businesses that benefit from the work of farm workers do not appear as farm employers in employment data. For example, Dole Fresh Vegetables in Salinas is listed under wholesale trade, SIC 5148, Fresh Fruits and Vegetables as are D'Arrigo Brothers and Fresh Express. Many of Dole's US subsidiaries do not hire farm workers directly. Instead, they contract with US growers to produce, under Dole standards, fruits and vegetables that Dole buys, an arrangement that makes these contract growers the employers of the workers producing Dole commodities. Dole's Bud Antle subsidiary, based in Salinas, CA, employs 7,000 farm workers sometime during a typical year to fill about 3,000 jobs harvesting lettuce and other vegetables; these workers are represented by Teamsters Union Local 890.
Farm labor data are notoriously unreliable, and the two major sources paint very different pictures of farm worker characteristics. The Current Population Survey reported that farm laborers were 29 percent Hispanic in 1993 (Ilg, 1995). The US Department of Labor, charged with determining whether there were likely to be farm labor shortages in the wake of IRCA, decided to develop a new survey of farm workers. The National Agricultural Worker Survey (NAWS) was designed measure entrances to and exits from the farm work force each year. Unlike the CPS, which is based on random sampling of households and thus generates an estimated total population number as well as worker characteristics, the NAWS interviews farm workers who are employed in on crop farms in selected US counties and generates only a profile of these workers, not a count.
The major change in the NAWS data in the 1990s is the falling percentage of workers legalized in 1987-88 and the rising percentage of unauthorized farm workers. In 1989, 37 percent of crop workers were Special Agricultural Workers who had been legalized under IRCA; by 1998, their share had fallen to 15 percent. In 1989, about 8 percent of US crop workers were unauthorized; that percentage rose to 52 in 1998.
Crop workers in California do farm work for about half the year at hourly wages slightly above the minimum. Over the year, farm workers interviewed in the NAWS averaged 23 weeks of farm, three weeks of nonfarm work and 26 weeks without US farm work. About 91 percent were employed in fruits and vegetables, and most of their jobs did not involve harvesting-- about 70 percent were pruning, irrigating and other non-harvest operations. Workers averaged 42 hours a week while they were doing farm work at $5.69 an hour, for average weekly earnings of $239 and annual farm earnings of $5,500-- 55 percent earned less than $7,500 in 1996.
About 70 percent of crop workers in the NAWS were hired directly by growers or farm management companies in the mid-1990s; 30 percent were hired by FLCs. Workers employed by FLCs had lower hourly earnings and were twice as likely to be paid piece rate wages as workers hired directly.
In California, farm workers must be covered by unemployment insurance (UI) and workers compensation (WC) insurance. Both programs are experience-rated, which means that employers with fewer laid-off workers seeking UI benefits or fewer injured workers seeking medical treatment pay lower taxes and premiums. Most farm employers pay WC premiums that are 10 to 20 percent of wages, and UI taxes average 5 to 6 percent of wages. In addition, employers and workers share equally the 15 percent Social Security tax, and workers pay for State Disability Insurance, which provides partial wage replacement to employees who are unable to work because of pregnancy or non-work related illness or injury.
Mandatory insurance premiums and taxes add 23 to 33 percent to the cost of employing a farm worker earning $6 an hour. In the nonfarm economy, most employers provide workers with other benefits, including health insurance, vacation pay, and pension benefits, and these cost employers the equivalent of 15 to 25 percent of earnings. Relatively few seasonal farm workers receive such fringe benefits. For example, only 5 percent of crop workers reported in the NAWS that they received health insurance in the mid-1990s, 4 percent earned paid vacations, and 5 percent lived in employer-supplied housing. One reason for the paucity of benefits such as health insurance is that they are expensive for low-wage workers. Nonfarm US employers paid an average $1 an hour for health insurance in 1998 ($2 an hour for union workers), which makes premiums a high percentage of hourly wages. For example, the 1996-2000 contract between the UFW and Bruce Church Inc, a Salinas lettuce grower, guaranteed workers at least $7 an hour, and BCI contributed $1.10 an hour for health insurance, meaning that health insurance alone added 16 percent to labor costs.
California manufacturing workers earned an average $13.66 in 1998, or more than twice average farm worker earnings. On an annual basis, full-time equivalent workers in agriculture earned an average 40 percent as much as manufacturing workers, with full-time equivalent livestock workers averaging $20,000, almost half the $42,000 in manufacturing, and full-time equivalent agricultural service workers averaging $15,000, about 37 percent as much as manufacturing workers.
The 3R's of the Farm Labor Market
Farming has been consolidating so that fewer and larger farms account for an increasing percentage of farm sales. Economic efficiency would suggest that a similar consolidation should be occurring in farm employment, so that workers needed to fill seasonal jobs report to central clearing houses from which farmers recruit workers. There are several candidates to be clearing houses for seasonal farm workers, including the public employment service (ES), union hiring halls, private labor exchanges and employer associations. Throughout the 20th century, employer associations and the ES played major job matching roles in seasonal agriculture, but their importance declined sharply in the 1970s and 1980s; in 1995-96, the ES in California reported 10,662 agricultural applicants, including 6,533 MSFWs (California Statistical Abstract, 1999).
There are 800,000 to one million job matches a year in California agriculture, and most are made by (1) bilingual foremen employed directly by farmers and (2) farm labor contractors. Recruitment is usually done without employer ads or requests to the ES for workers; it is more common for foremen to tell current employees that additional workers are needed, and to recruit them via networks of current employees. In this manner, relatives and friends from the same village or area of Mexico often wind up working no the same US farm.
Farm labor contractors (FLCs) are often blamed for the ills of the farm labor market. FLCs are intermediaries who, for a fee, organize workers into crews and arrange jobs for them; many FLCs also provide workers with other services, from financing their illegal border crossing to housing and meals. FLCs have a different relationship with farm employers than with farm workers. It is usually hard for a FLC to "cheat" a farm employer, since farm employers often survey themselves to arrange a standard piece rate as well as the FLC commission or overhead fee. For example, farmers may agree to pay $10 a bin for picking oranges or peaches, plus a 32 percent overhead for the FLC to cover payroll taxes, toilets and drinking water, and recruitment and payroll expenses.
Farm workers hired by FLCs, on the other hand, are often newly arrived from Mexico, and do not know about prevailing piece rates, minimum wages, or required payroll taxes and deductions. As the U.S. Industrial Commission explained in the early 1900s, contractors dealing with immigrants from the same country can "drive the hardest kinds of bargain" with newly arrived immigrant workers because they know the circumstances from which farm workers come (US Commission on Immigration, 1911, quoted in Fisher, 1952, p. 43). Many of the most abusive violations of labor laws continue to be found among FLCs hiring newly arrived immigrant workers.
Beginning in the 1960s, the federal and state governments attempted to regulate FLCs to prevent them from taking advantage of vulnerable workers, first by getting to identify themselves to the government by registering. Since then, a three-tiered registration system has developed: FLCs must be registered with the federal, state, and local governments (county agricultural commissioners), and state registration requires providing fingerprints, a bond, and passing a test demonstrating knowledge of labor, safety and pesticide regulations. The state maintains a list of about 1,200 registered FLCs, and encourages growers to utilize only registered FLCs by making growers jointly liable for labor law violations committed by unregistered FLCs.
Bills in the California Legislature that would have automatically made growers jointly liable for the labor law violations committed by FLCs on their farms failed in 1993 and 2000, although a bill establishing a farm labor contractor license verification unit within the state labor commissioner's office was approved. Worker advocates argue that strict joint liability is needed to get growers to ensure that the FLCs who bring workers to their farms abide by labor laws. Farm employers counter that, just as homeowners who hire a contractor to work on their homes are not liable for labor law violations committed by the contractor while he has a crew working at their homes, so farmers should not be liable for violations committed by independent FLC businesses when they have crews on their farms.
Reward or Motivation
After minimum wage laws were applied to agriculture, farmers were required to keep records of the hours each employee worked and how many units of work each employee accomplished. If the employee did not work fast enough at the grower-set piece rate to earn the minimum wage, the employer had to make up the difference. Most farm employers terminated workers who did not work fast enough to earn the minimum wage at the piece rate offered, establishing an "iron triangle" between minimum wages, piece rates, and minimum productivity standards. For example, if the minimum wage is $5 an hour, and the employer is paying a piece rate of $10 a bin, then workers must pick an average one-half bin an hour to earn the minimum wage; slower workers may lawfully be terminated.
Piece rate wages motivate workers to work fast, requiring an employer monitor of the quality of the work done. However, the detailed record-keeping requirements to ensure compliance with minimum wage laws encouraged more farmers in the 1990s to pay their workers hourly wages. Hourly wage systems increase the need for monitoring the pace of work. Crews of workers paid hourly wages often include a foreman or crew pusher who sets the pace for workers walking through a field hoeing weeds, or require harvest workers to follow a conveyor belt through the field and place lettuce, broccoli, or melons on it-the speed of the machine controls the pace of work.
Most farmers are more interested in ensuring that enough seasonal workers will be available when they are needed rather than in ensuring that a particular worker identified by the farm employer's personnel system returns next year. This leads most farm employers to favor collective pressure on the federal government to provide agriculture with easy access to foreign workers.
For the past 120 years, there have been fears of farm labor shortages. However, farm labor has never been a binding constraint that prevented the expansion of labor-intensive crop production. Indeed, the federal government has usually permitted the recruitment of legal foreign farm workers or tolerated the presence of unauthorized workers, encouraging the flood rather than the drip farm labor strategy.
The US in 2000 may be nearing another farm labor cross roads. Unemployment rates nationally are at their lowest rates in several decades, and farm workers able to find nonfarm jobs are exiting the farm work force, to be replaced by unauthorized workers. Farmers thus become vulnerable to the removal of these unauthorized workers, and they are pressing for another easy-access guest worker program. Farm worker advocates oppose another guest worker program; instead, they favor an amnesty for at least some currently illegal workers. However, if the experience of the 1987-88 farm worker legalization repeats itself, newly legalized farm workers will quickly move on to nonfarm jobs. Unless illegal immigration is slowed, vacant jobs will once again be filled by newly arrived unauthorized workers.
Unions and Bargaining
In 1975, California enacted the Agricultural Labor Relations Act, which granted farm workers the right to organize and bargain collectively with farm employers and established a state agency, the Agricultural Labor Relations Board (ALRB), to supervise elections to determine if workers wanted to be represented by unions and to adjudicate unfair labor practice complaints (Fogel, 1985). The union presence in agriculture is most pronounced in four areas: (1) southern California dairies, (2) large Central Valley nurseries, (3) fresh mushrooms in coastal areas and (4) coastal vegetables. In 2000, there are five major unions representing about 30,000 farm workers on 300 farms; two thirds of these union contracts cover dairies in southern California.
The best known farm worker union is the United Farm Workers (UFW), which burst onto the national scene in 1965 in support of a strike called by largely Filipino grape pickers organized into the Agricultural Workers Organizing Committee, an AFL-CIO affiliate (Martin, 1996; Majka and Majka, 1982). The UFW won a 40-percent wage increase for some table grape harvesters in 1966, and Cesar Chavez was featured on the cover of Time Magazine in 1969. The UFW was able to win contracts covering most grape and lettuce workers in the early 1970s, before the ALRA was enacted, but the UFW found it very difficult to re-negotiate first contracts, both before and after the ALRA came into effect. In some cases, the UFW was certified to represent workers in the late 1970s, and had not yet negotiated first contracts in 2000.
The major farm worker union story in the 1990s has been the rebirth of the UFW after Cesar Chavez died April 23, 1993. At the time of this death, Chavez was praised as the "Latino Martin Luther King," and has become the US Latino with the most streets and schools named for him; in August 2000, California created a paid holiday for state employees in his honor. However, the UFW largely stopped organizing farm workers in the 1980s. Chavez's son in law, Arturo Rodriguez, became president of the UFW in 1994, and the UFW launched an aggressive organizing effort. Between 1994 and 2000, the UFW was certified to represent a peak 4,000 workers on 18 California farms, and negotiated five contracts. However, the UFW continues to be able to turn only about one-fourth of its election victories into contracts, and continues to be decertified as bargaining representative on one or two farms a year.
The UFW plays a major role in farm labor, Latino, and immigration issues. The major UFW organizing effort of the 1990s aimed to organize 15,000 to 20,000 strawberry workers in the Salinas area. The UFW targeted Coastal Berry, the employer of 1500 workers, in what AFL-CIO President John Sweeney in 1997 called the most important union-organizing drive in the US. A competing farm worker group, the Coastal Berry Farm Worker Committee, won a July 1998 election to represent Coastal workers. This election was overturned in May 1999, and a new election was held in June 1999, with the Committee winning the right to represent about 900 Coastal workers in northern California and the UFW 600 in southern California.
The UFW is a labor organization whose goal is to organize and represent farm workers in their dealings with farm employers. There are other labor organizations and a variety of self-help and advocacy groups that also seek to represent and assist farm workers, including the Teamsters and the United Food and Commercial Workers Union. As newly arrived farm workers come to include more indigenous peoples from southern Mexico and Central America, self-help groups have sometimes been certified to represent farm workers.
Some have suggested that the UFW could use its reputation as an advocate for newly arrived immigrants to (1) represent nonfarm workers or (2) to become a provider of housing and other services to Hispanics in urban areas. The UFW in September 2000 amended its constitution to permit organizing nonfarm workers covered by the NLRA. The UFW has affiliates that operate radio stations and build and rehabilitate housing, and is reportedly considering opening service centers that would provide translation, financial and immigration services in Los Angeles and other cities to which ex-farm workers familiar with the UFW gravitate after they leave the farm work force.
The influence of farm worker unions should not be underestimated. The fact that farm worker unions might organize dis-satisfied workers has encouraged some farm employers to maintain wages and benefits at higher-than-prevailing levels. The major impact of farm worker unions such as the UFW in the 21st century could come from their ability to influence public policies that affect farm worker wages and working conditions in a number of policy areas that range from immigration and health insurance policy to labor laws and their enforcement.
The goal of many farm labor reformers during the 20th century was to "upgrade" farm labor to make it resemble the nonfarm labor market, with employers "taking responsibility" for farm workers by restructuring their operations to employ fewer workers for longer periods. Farm labor markets did not change significantly, but many nonfarm labor markets adopted farm labor features, in the past 20 years, with more use of intermediaries assembling and deploying contingent and other temporary workers. If federal and state governments step-up the regulation of intermediary-dominated labor markets that hire mainly immigrant farm workers, farm and nonfarm labor markets may be treated similarly.
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