Coffee growers violated labor laws

Some of Kailua-Kona’s well-known coffee growers and producers are being required to pay more than $100,000 in back wages and penalties for labor violations, including failing to pay minimum wage and putting 5-year-olds to work picking coffee.

About 150 workers, mostly Spanish-speaking migrant workers from California, and Micronesians, have received a total of $63,000 in back wages for the widespread labor violations uncovered after eight investigations by the U.S. Labor Department that began in late 2011 and spanned the early part of 2012, said Terence Trotter, director of the Wage and Hour Division’s Hono­lulu District Office.

Concerned that Hawaii’s coffee industry employs a fair number of migrant workers who might not understand the federal laws that govern work relationships, investigators spot-checked growers and producers in Kailua-Kona, the largest coffee-producing region in the state.

"We wanted to pick farms that produced Kona coffee and were large enough for us to have a meaningful impact," Trotter said. "What we wanted to do was determine what was the status of compliance. We found that the scope of the level and the problems varied."

As a result of findings, some key producers in Kailua-Kona were charged $42,000 in combined civil penalties. Gold Coffee Co., Greenwell Farms, Koa Coffee Plantation, Mountain Thunder Coffee Inc. and farm labor contractor Toma­sita Farm Service, which provided workers to Koa Coffee Plantation and Bird Feather Hawaii, racked up violations that fell under the Fair Labor Standards Act. The most common violation was paying workers piece-rate wages below the federal hourly minimum wage of $7.25; improperly classifying nonexempt employees as exempt from receiving overtime pay; and failure to pay employees for all hours worked and to maintain records of employees’ wages and work hours.

Gold Coffee, Greenwell Farms, Koa Coffee Plantation, Bird Feather Hawaii, Kona Blue Sky Coffee and Toma­sita Farm Service also had violations of the Migrant and Seasonal Agricultural Worker Protection Act, such as failing to register as a licensed farm labor contractor; failing to disclose employment terms and conditions and to provide wage statements and inform workers of their rights; failing to maintain legally required employment and payroll records; failing to provide safe transport vehicles; and failing to obtain prescribed insurance coverage for transportation vehicles.

In one of the most egregious violations, Toma­sita Farm Service sent two 5-year-olds to bring in the harvest at Koa Coffee Plantation, Trotter said.

"Clearly when you have 5-year-olds employed in the field picking cherries, that doesn’t meet our minimum age standard," he said, making the distinction that the children were family members of workers and not the people who ran or owned the farms.

Trotter said Koa Coffee Plantation told investigators that they were unaware that the farm service was using children and have since taken corrective measures. The department assessed $16,000 in civil penalties against Toma­sita Farm Service for the child labor violations, he said.

None of the coffee farms returned calls to the Star-Advertiser, and Toma­sita Farm Service could not be reached.

"While we are pleased to have recovered back wages for a substantial number of workers, we will continue our effort to promote awareness and improve compliance in this industry," Trotter said. "The U.S. Department of Labor is not a collection agency for back wages and funds. Our main purpose is trying to create an environment in which problems won’t occur in the future." 

After the investigation, Trotter said the division obtained agreements from the cited employers not to violate in the future.

"The violations were corrected, and with this group of employers we feel that we’ve cleaned up the problems," he said.

The Kona Coffee Council, which represents about 170 coffee farmers, processors and others involved in the industry here, also has agreed to promote labor law compliance and has established a code of conduct for lawful employment practices and working conditions. Members have agreed that they will not knowingly ship or receive goods that were produced in violation of minimum wage, overtime and child labor requirements.

Mark Storfer, executive vice president and chief operating officer of retailer Hilo Hattie, which sells Kona coffees, said this latest problem adds to the recent challenges that Kailua-Kona coffee growers have faced.

"Their supply still is way down and their prices are up due to the coffee borer beetle infestation," Storfer said. "Consumers are very price sensitive, so that hurts."

Some consumers are socially conscious, too, Storfer said.

"Generally speaking, American consumers are pretty savvy about domestic labor laws and international rights," he said. "If there is validity to this, it might not bode well for Hawaii’s coffee industry."

While there are many emerging coffees in Hawaii, the products from Kailua-Kona still have the most brand identity, Storfer said. According to the council, there are about 600 coffee farms and more than 100 private labels in the region.

"They are top sellers. I sure hope this doesn’t give the industry a black eye," he said. "There’s a lot of interest in Hawaii coffee. We are the only state that grows coffee."