SAU CFDD
Jun 052014
 

By Barb Arland-Fye
The Catholic Messenger

Kevin O’Brien of Holy Family Parish, Davenport, has been investigating wage theft cases for 40 years, the most memorable one involving 32 men with intellectual disabilities who’d been cheated out of fair wages for decades.

Barb Arland-Fye
Wage Hour investigator Kevin O’Brien of Holy Family Parish, Davenport, helped lay the groundwork to prove 32 men with special needs had been cheated out of fair wages.

Memories of the travesty resurfaced earlier this year with publication of the New York Times story titled “The ‘Boys’ in the Bunkhouse.” Many people praised the in-depth story that described what the men from Texas endured while living and working in Muscatine County most of their adult lives, and how they’re doing now. But the story didn’t include the groundwork laid by Wage Hour investigators O’Brien and Randy Luth, who provided concrete evidence of the exploitation.

O’Brien’s testimony on wage theft in the case against Texas-based Hen­ry’s Turkey Service is included in court documents.

“I think this was one of the most significant cases of abuse I’ve been associated with,” said O’Brien, whose involvement began in February 2009 at the behest of his employer, the U.S. Department of Labor, Wage and Hour Division. The investigation gave him a greater understanding of why the exploitation continued for more than 30 years and what should be done to prevent it from happening to other vulnerable adults.

“What each agency (involved in the case) needs to do – and maybe all of them together, and maybe Congress — is to ask: How did this happen? How did we not take action to eliminate this in 1979,” O’Brien said. “Someone taught me early on when I was a rookie: “Follow the money — that’s where the problems are.”

O’Brien and Luth followed the money after federal, state and county officials in February 2009 raided the house in Atalissa, known as the “bunkhouse,” where the men with intellectual disabilities lived. The Wage Hour investigators’ task was to determine whether the men had been paid the wages they were owed for work they performed at West Liberty Foods in West Liberty. Henry’s Turkey Service provided the employees on contract with the meat-packing plant.

Henry’s had complete responsibility for the men’s lives — providing them with jobs, food, shelter, transportation and daily care, according to news reports and court documents. The company also claimed to have a certificate allowing it to pay the men a substandard wage because of their intellectual disabilities. The investigators pored through three years of records subpoenaed from Henry’s Turkey Service and examined West Liberty Food’s records to determine hours of operation and job requirements. When the case went to court, the statute of limitations allowed for evidence from the last two years of the men’s employment.

Steve Fye
This building in Atalissa once housed men with intellectual disabilities who were found to be deprived of fair wages and a decent home in which to live. The men were removed from the house more than five years ago.

“The West Liberty records were easy to verify and check. If you needed to cross-check to see whether their (meat-processing) lines were working, you could cross-check time records, electronic records. Most of the Henry records were hand-written records — the original ones,” O’Brien said. In seeking to verify work records, the Wage Hour investigators also interviewed the men’s fellow employees at the meatpacking plant and caregivers at the bunk­house. The men themselves were unavailable for interviewing because they had been moved out of the bunkhouse and away from Atalissa.

Through their investigation, O’Brien and Luth discovered that the men preformed as proficiently as their non-disabled coworkers. At $7.25 an hour, the minimum wage, the men should have earned $15,130.75 a year, O’Brien said. That figure took into account holidays, plant shut-downs and other variables, including overtime.

“One of the first things I had to do was find out how much they were paid per hour. Newspapers were saying they were being paid 50 cents an hour or less.” After reviewing records and conducting interviews, O’Brien realized that the men weren’t being paid 50 cents an hour; they were being paid $65 per month. “I wanted to know why they were paid $65 a month. It’s not an hourly rate; it was a monthly rate.” They’d been paid that amount for years.

On a hunch, he checked with the Social Security Administration office to ask whether the men received disability payments because of their intellectual disabilities. “If someone is mentally handicapped from birth, would they be eligible for disability payments or some kind of payment?” he asked. The response was “yes,” a payment of around $700 per month would be paid to such an individual to provide for basic living expenses, such as housing.

He asked, “If someone is eligible for $700 a month disability, what if they could work a bit? How much could they receive without it cutting into their disability payment?” The answer was $65 a month. If you exceed $65 a month, what would happen? He was told that $1 would be deducted for every $2 earned.

Henry’s Turkey Service had access to the men’s monthly Supplemental Security Income (SSI) checks as their “payee,” someone designated to handle the funds on behalf of the dependent individual, O’Brien learned through his investigation. Henry’s collected not only the men’s SSI checks, but wages totaling hundreds of dollars more per month than they paid the men. Henry Turkey Service’s claim that it could pay the men a substandard wage was not justified and the certificate for it had long ago expired, O’Brien said. “I just had to prove it wasn’t in effect. One of the things I brought up was that even if Henry’s had a certificate, (the men) were working on an assembly line. A worker has to do x-amount of work for the line to move. If they didn’t do their job, the line stopped. So they had to be doing what that spot called for. When they weren’t (at work) regular West Liberty worker would fill in. They were doing the same work the non-handicapped individuals on the line were doing.”

The men’s SSI payments, which Henry’s used for food and lodging, far exceeded what the company actually spent on these items, O’Brien added. Further­more, the men were living in substandard housing, which prompted federal, state and local officials to remove them from the bunkhouse.

In July 2011, the U.S. District Court for the Southern District of Iowa found Hill Country Farms Inc., doing business as Henry’s Turkey Service, and co-owner Kenneth Henry liable for unpaid wages of $880,777.17 and an equal amount in liquidated damages for a total of $1.75 million, plus post-judgment interest.

In September 2012, the U.S. Equal Employment Opportunity Commission (EEOC) won the first part of its lawsuit against Henry’s Turkey Service. U.S. District Court Judge Charles Wolle for the Southern District of Iowa ruled that the business had violated the Americans with Disabilities Act (ADA) by paying 32 workers with intellectual disabilities severely substandard wages. The judge ordered Henry’s Turkey Service to pay its former employees lawful wages totaling $1.3 million for jobs they performed under contract at the West Liberty meat-packing plant, according to a Sept. 19, 2012, EEOC news release. “The EEOC’s wage claims for each worker ranged from $28,000 to $45,000 in lost income over the course of their last two years before the Henry’s Turkey Service operation was shut down in February 2009,” the news release said. An expert witness at the trial, Sue Gant, declared that the company “took advantage of the workers … knowing that they would likely not be discovered because the workers were disabled.”

In 2013, the second part of the EEOC lawsuit, a federal jury in Davenport awarded the men a total of $240 million in damages. However, that figure was reduced because Henry’s Turkey Service employed fewer than 101 employees and could be sued a maximum of $50,000 per worker for compensatory and punitive damages under the ADA (Quad-City Times, May 14, 2013).

Asked how the case and his role in the investigation impacted him, O’Brien said:

“Many of these same handicapped individuals started working for Henry’s Turkey when I was starting work. Why was I so lucky? That’s probably what impacts me. Why is it happening that we’re so lucky … Here’s people who got out of bed at 3:30 or 4 o’clock in the morning and were taken in a van to a meat-packing plant. They worked in a place that (because of the odor) made me sick to my stomach to walk by.

“… They’d go back to a bunkhouse heated by space heaters for the last half-dozen years. You’ve got all these reports about the conditions in the bunkhouse and the bugs. That’s what they lived in.”

Clear signals of exploitation had surfaced before. O’Brien has collected newspaper clippings dating back to the 1970s that chronicle the exploitation Henry’s engaged in. “Bunkhouse was no secret,” reads a Quad-City Times editorial dated March 21, 2009. The editorial begins: “On at least 17 occasions since 1994, state and federal officials recorded specific concerns about the working and living conditions of the mentally retarded Henry’s Turkey Service employees living in the Atalissa bunkhouse …”

O’Brien thinks each agency involved in the case should evaluate its response to the men’s plight and what might be done to prevent such abuse from occurring again.

“I’m in favor of my agency looking at: ‘What did we do right? What did we do wrong? What was in our control?’ ‘How do we come up with best practices?’ We did a lot of good work.

What was not in our control? The tax stuff, for instance. What about other agencies: Iowa Department of Human Services and Texas Department of Human Services. What was their role?

“Just some subtle changes would have highlighted a lot of the (illegal stuff) that was going on,” O’Brien said. The Depart­ment of Labor, for example, could insist that if a company is going to claim food and lodging expenses it needs to demonstrate that it paid payroll taxes.

Henry’s didn’t do that … because it wanted to claim the men’s Supplemental Security Income, which would have been reduced, had SSI known that Henry’s was collecting wages from the men well beyond the $65 a month the company claimed.

“We ended up with a great court decision, but it should have been 30 years earlier … If you don’t make systemic changes, history will repeat itself, O’Brien noted. The New York Times reported that changes have occurred. O’Brien responds that “some changes are being made in federal regulations, but I don’t think it’s anything that would have stopped what was going on. The company was ignoring the law anyway.”

And despite the court decision, the exploited workers seem unlikely to collect from their former employer. National Public Radio’s “All Things Considered” reported that Henry’s Turkey Service is out of business. Most of the men were taken in by Exceptional Persons Inc., a support center in Waterloo (www.npr.org, May 16, 2013). Some of the men moved to the South to live with family, said the New York Times.

Ferris

“This was an incredibly sophisticated system of abuse. Policies and reg­ulations at a state level are not often able to appreciate when you have individuals moving from one state to another,” ob­served Kent Ferris, director of the Diocese of Davenport’s Social Action Office.

“To me it speaks to the importance of what is going on in our communities, and even if we aren’t sure how we can be supportive, or what type of assistance we can provide as a diocese, we need to be actively engaged in the greater community because of our faith.”

 

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  2 Responses to “Five years later: investigator reflects on sensational wage theft case in Atalissa”

  1. Why do we make laws and set enforcement policies which enable the wealthy to exploit the poor and disadvantaged? How many of us stood idly by and allowed this travesty to continue? Or, how many of us failed to listen to those who tried to speak out?

    It’s time we do a true examination of conscience and look out for others rather than merely complain when it happens to us. How many of us close our eyes to the injustice we see in our daily lives and pretend it does not exist?

    This is not just a story about “them”. It is about us. How many times did we “…nail Him up today?”

    Fran Andersen

  2. My first thought was “where are the parents/relatives?” Surely not all of these men were orphaned. SOMEONE had to sign over custody and responsibility to Henry’s. Instead of the blame game, instead of expecting the government to do something about it, why aren’t we taking care of our brother?

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