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October 1995, Volume 1, Number 4

Texas A&M Settles Farm Worker Suit

Texas A&M admitted on August 15,1995 that it wrongly paid 400
farm workers employed at 10 of the university's 18 agricultural
experiment stations as independent contractors. Farm workers should
have been paid at least $3.80 per hour between 1990 and 1993, and
Texas law requires farm employers to pay the employer and employee
share of Social Security taxes, so that Texas A&M's total cost of
employing farm workers should have been $4.31 per hour.

By treating farm workers as independent contractors, the
university was able to pay $3.80 per hour, but farm workers were then
responsible for the entire amount of Social Security which, if paid,
would have reduced their earnings to $3.22 per hour.

Texas A&M agreed to pay each affected worker $120, plus back
taxes of $86,000, plus pay Texas Rural Legal Aid $30,000, and spend
$20,000 to advertise the settlement in Spanish among farm workers.

The IRS estimated in 1987 that almost four million of the then 110
million employed workers in the US were unlawfully being paid as
independent contractors.

In Congress, legislation was approved by the House to restructure
the Legal Services Corporation, which currently funnels $400 million
annually to 300 legal services providers, and instead make a legal
services block grant of $278 million to states based on the number of
people below the poverty line. States, in turn, would ask lawyers to
bid on legal work for eligible poor clients, and submit bills monthly
to the state government.

A Senate version of the bill would cut the budget to $340 million.
Both versions would prohibit the lawyers from lobbying the government
and from bringing class-action suits.

In Ohio, the state eliminated a $125,000 grant to a farm worker
service group, Advocates for Basic Legal Equality, and instead
provided funds for the agricultural Extension Service to mediate
disputes between farm workers and growers. Baldemar Velasquez,
president of the 5000-member Toledo-based Farm Labor Organizing
Committee, said he will work with the mediation service.

Peter Kilborn, "For Legal Aid, Tough Times Get Tougher," New York
Times, October 7, 1995. Marc Lacy, "House Panel's Vote May Seal Fate
of Legal Aid Group," Los Angeles Times, September 18, 1995. "Group
says money gone," The Columbus Dispatch, September 10, 1995; David
Cay Johnston, "Workers paid as contractors: a widespread abuse is
cited," New York Times, August 16, 1995.

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