Source: Rita Jane Gabbett, MEATINGPLACE, 9/4/19


Three poultry plant workers have filed a class action lawsuit against 18 chicken processors, several of their subsidiaries and two consulting firms claiming the group has conspired to fix and depress compensation paid to non-supervisory production and maintenance workers since 2009. 

The lawsuit, filed Friday in the United States District Court of Maryland, named defendants including chicken processors: Perdue Farms, Tyson Foods, Keystone Foods, various Equity Group divisions, Pilgrim’s Pride, Sanderson Farms, Koch Foods, JGC Industries, Wayne Farms, Mountaire Farms, Peco Foods, Simmons Foods, Fieldale Farms, George’s Inc., Ozark Mountain Poultry, House of Raeford Farms, O.K. Foods, Harrison Poultry, Mar-Jac Poultry, Amick Farms, Case Foods and Allen Harim Foods. 

Also named as facilitating the exchange of competitively sensitive compensation data are Agri Stats Inc. and Webber, Meng, Sahl and Company (WMS).

Defendant processors own and operate approximately 200 chicken processing plants in the United States, employing hundreds of thousands of class action members who have occupied various positions along processing lines, from hanging live chickens to slaughtering the birds to deboning to repairing the processing machines.

The lawsuit asserts the defendants formed, implemented, monitored and enforced the conspiracy in three ways.

First, the lawsuit claims senior executives of the defendant processors, including human resources executives and directors of compensation, held recurring “off the books” in-person meetings at the Hilton Sandestin Resort Hotel & Spa in Destin, Fla., during which they exchanged information about, discussed, agreed upon and ultimately fixed the wages and benefits of class members at artificially depressed levels.

Second, the lawsuit claims on a highly frequent basis, defendant processors exchanged detailed, current and non-public wage and benefits information through surveys conducted by Agri Stats and WMS. Each defendant processor allegedly subscribed to and partnered with Agri Stats to exchange and receive — on a monthly basis — effective hourly wage rates regarding categories of chicken processing plant workers from each defendant processor’s plants. Similarly, WMS conducted a detailed annual survey of the hourly wages and benefits paid by each defendant processor to each category of chicken processing plant worker and circulated the survey results to senior executives of the defendant processors during in-person meetings.

While both Agri Stats and WMS have claimed that the exchanged compensation data was anonymous, the lawsuit alleges the data was sufficiently granular and disaggregated that executives of defendant processors could and did easily match the distributed wage data to chicken processing plants operated by specific processors. The lawsuit claims these processors then used the data obtained from Agri Stats and WMS to fix and depress the compensation paid to class members and ensure and confirm that no conspirator deviated from the conspiracy.

Third, the lawsuit alleges managers at the chicken processing plants engaged in bilateral and regional exchanges of wage and benefits information. Those managers frequently reached out directly to their counterparts at competitors’ chicken processing plants to request and exchange wage and benefits data, including data regarding plans for future wages and benefits. Those plant-to-plant exchanges of wage and benefits information were conducted through various mediums, including telephone calls and surveys disseminated through electronic listservs. The wage data obtained from these plant-to-plant information exchanges was provided to executives of the defendant processors, who used the data to facilitate the fixing of compensation, the lawsuit claims.

Processors respond

“We do not believe this suit has any merit. Our compensation philosophy is to pay fair and in some cases above average wages to our plant associates. Our total rewards compensation program consists of a salary, benefits and discretionary bonuses,” a Perdue Farms spokeswoman told Meatingplace in an email.  “Our recruiting efforts target the entire community. The population of our manufacturing workforce is representative of the communities where our plants are located. We do, just as other companies do, participate in national benchmark surveys with food and other consumer product goods companies to ensure we can attract top talent. Our associates receive annual wage increases and as wage trends continue to shift in the United States, we have made additional adjustments where necessary.”

A Tyson Foods spokesman declined to comment specifically on the lawsuit, but directed Meatingplace to the company’s most recent sustainability report, which states, “We’ve made improvements in pay and benefits while also creating new employee relations enhancements that differentiate us from competition … Our compensation department regularly conducts wage surveys and reviews cost-of-living indicators and community norms … In February 2018, we awarded bonuses ranging from $500 to $1,000 to more than 100,000 team members as a result of company savings due to federal tax reform.”

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