JBS works to settle lawsuit
Class-action suit alleges collusion with industry peers to keep wages low
GREELEY >> JBS USA Inc. will settle a class-action lawsuit brought by a trio of meatpacking workers that claims that the Greeley-headquartered meat giant conspired for almost a decade with nearly a dozen other leading companies in the industry to keep employee wages artificially low.
The lawsuit, filed in 2022 in the U.S. District Court for the District of Colorado, alleges that executives from the companies, which control about 80% of the national meat-processing market, shared compensation data with each other, held secret meetings to determine future raises for all their employees, agreed not to recruit each other’s workers and more.
In a court filing this week, attorneys for the plaintiffs, who worked at meatpacking plants in Iowa and Georgia, and JBS lawyers said that the workers “have reached agreement with JBS to settle all claims against it.”
Terms of the settlement were not disclosed, but the memo said that additional details will be filed with the court at a later date.
In addition to allegations that the meat companies gathered compensation data and secretly met to exchange that data, the defendants also were accused of entering into illegal agreements with each other to not recruit each other’s employees, according to the 2022 complaint.
Two data and consulting companies, Fort Wayne, Indiana-based Agri Stats Inc. and Pottstown, Pennsylvania-headquartered Webber, Meng, Sahl & Co. Inc., were also named as defendants in the lawsuit for allegedly helping the meat producers conspire and collude.
Meatpacking is one of the most dangerous industries in the U.S., according to the complaint, with a nonfatal injury rate of around 20%. Meatpacking workers are seven times more likely to suffer repetitive strain injuries.
Hazards include high noise levels, dangerous equipment, slippery floors, musculoskeletal disorders and hazardous chemicals.
Because of these dangers and the low compensation in the industry, many Americans are unwilling to work meatpacking jobs, the complaint states. Because of this, “Defendant Processors, their subsidiaries, and related entities often recruit hourly-paid workers who have limited alternative options for employment. Many of the hourly-paid workers recruited and hired by Defendant
Processors, their subsidiaries, and related entities are migrant workers, refugees, asylum seekers, prison laborers, or participants in court-ordered substance-abuse programs.”
According to the complaint, compensation decisions at the defendant companies were made in a formulaic way across the country at the highest executive levels, with executives determining compensation schedules for their own company, then comparing them with those at other companies.
Beginning in 2014, executives at the defendant companies designed a “Red Meat Industry Compensation Survey” that allowed them to compare compensation data for numerous positions from company to company, the lawsuit alleged.
Every year after the survey was completed, executives from the defendant companies met in secret to discuss the results, beginning with a 2014 meeting at the Kansas City Airport Sheraton, according to the complaint. At these meetings, the defendants engaged the consulting company Webber, Meng, Sahl & Co. Inc. to present the surveys, according to the complaint, with WMS representatives often being asked to leave the meetings after presenting their data, at which time the meat-processing executives would discuss, determine and agree on salaries, wages, bonuses and benefits. Plaintiffs allege that the defendants would agree upon plans for salary and wage increases going forward.
The wage-fixing case is not the only recent classaction lawsuit JBS has settled. Pilgrim’s Pride Corp., a JBS subsidiary also based in Greeley, agreed in 2020 to pay a $110.5 million settlement to the government after the U.S. Department of Justice accused the company of conspiring with other poultry processors to fix prices.
The case is Ron Brown, Minka Garmon, and Jessie Croft, individually and on behalf of all others similarly situated v. JBS USA Food Co.; Cargill Inc., Cargill Meat Solutions Corp.; Hormel Foods Corp.; American Foods Group LLC; Triumph Foods LLC; Seaboard Foods LLC; National Beef Packing Co. LLC; Iowa Premium LLC; Smithfield Foods Inc.; Smithfield Packaged Meats Corp.; Agri Beef Co.; Washington Beef LLC; Perdue Farms Inc.; Agri Stats Inc.; and Webber, Meng, Sahl, and Co. Inc. d/b/a WMS & Co. Inc.
— This article was first published by Bizwest, an independent news organization, and is published under a license agreement. © 2024 Bizwest Media LLC.