The Agriculture Labor Dilemma In The Dairy Industry
Bob Gray, Agriculture Policy Advisor
October 5, 2021
The lack of sufficient labor for dairy farmers has been a significant problem for a very long time.
Although the recent COVID pandemic has exacerbated the availability of securing an adequate farm workforce on dairy operations, the issue has a very long history. And most recently it has expanded well beyond the farm gate. Our dairy cooperatives cannot find sufficient help to keep their processing facilities running full time and a number of them have had to curtail their operations to fewer days a week. In addition a severe shortage of truck drivers has taken a toll on bulk tank pickups at dairy farms and the delivery of raw milk to processing plants. Therefore lack of sufficient labor has become an industry wide problem.
The issue of immigration reform has always been controversial to say the least. The minute you mention immigration reform the first word that comes out of an opponent’s mouth is “amnesty”. It is like yelling “fire” in a crowded theater. Amnesty is defined as being “pardoned” without any requirements or restrictions placed on the individual involved. In order to accommodate all of the federal immigration requirements non-citizens must go through a rigorous approval regulatory process. It is distinctly different from a pardon. This is clearly the most controversial issue I have encountered in all the years I have worked on Capitol Hill.
This article will concentrate primarily on the problems dairy producers face in finding enough help to keep their operations running at full tilt and the lack of any federal labor programs available to assist them. My first experience with this problem goes all the way back to January 1998. At that time I was serving as the Dairy Policy Advisor to the Northeast Dairy Farmers Cooperatives. Rick Smith, then the CEO of Dairylea Cooperative and now the CEO of Dairy Farmers of America asked me to come to Syracuse New York on a very snowy day to discuss the problem Dairylea members were having trouble finding sufficient help to fill their labor needs. Local help was just not available. Many of the producers had started hiring Mexican and Guatemalan immigrant workers to meet their workforce needs since their dairy operations were steadily growing in size.
However, their concerns, and rightly so were based on the fear that some of these new employees may have entered the U.S. illegally. Hiring undocumented immigrant workers and running afoul of federal immigration laws was a major concern since no dairy farmer would knowingly hire an illegal worker.
New employees would of course have to pay federal and state taxes and pay into the Social Security Trust Fund. Their Social Security number would have to be submitted along with all other employment information. The concerns with an I-9 audit by the Department of Labor (DOL) or an Immigration Customs Enforcement Service raid on their operation remained as a key point of anxiety. Now 23 years later since 1998 and nothing has changed. There still is no federal program available to provide fully vetted legal immigrant workers to dairy farmers that can that be employed 12 months a year.
In short, the dairy industry needs two distinct federal programs to satisfy its labor needs:
One that is similar to the current federal H-2A seasonal worker program for fruit and vegetable growers operated by DOL that will provide fully vetted legal immigrant workers who are available to work on dairy operations year round. These workers should be able to continue to be employed on an annual basis in the future as their visas are updated.
Secondly there needs to be a process in which workers who are currently employed on dairy farms who may be undocumented that will allow them to come forward and undergo background checks as well as meet other requirements. This would include the length of time they have worked in agriculture. Once this process is completed and the employee is cleared a work visa would be approved to allow them to continue to work on the dairy operation. The workers families if married would be protected as well during this process. They would not have to leave the U.S. at any point.
In 1998 there was legislation pending in Congress known as the “Ag Jobs” Bill. If passed it would of addressed many of the needs discussed above. The bill was reported out of the Senate Judiciary Committee in 2007 but never went any further.
Fast forward to 2013. The Border Security, Economic Opportunity and Immigration Modernization Act—S.744 a very comprehensive bill which also would of dealt with many of the ag labor needs I have described passed the Senate. The House however failed to take the bill up. As you can see this issue has been on the legislative agenda for the agriculture community and for dairy in particular for a long time. We have worked hard to get federal legislation passed. It is of the highest priority for dairy.
As we have moved toward 2021 there have been constant legislative efforts to move legislation. Expanding the H-2A program has been a very high priority. The Department of Homeland Security Appropriations Bill a number of times has contained a provision to expand this program to allow for full time immigrant employees to work year round. Each time it failed to make the final cut when the DHS spending Bill was passed. It is currently in the Fiscal Year 2022 DHS Appropriation’s Bill. Dairy producers know that under the H-2A program they will be required to pay for housing, transportation and other related expenses.
As we head into the fall of 2021 there is legislative activity in Congress. The House last spring passed “The Farm Workforce Modernization Act” H.R. 1603 by a fairly wide margin and bipartisan support from both sides of the aisle. No action yet in the Senate on this legislation.
The bill expands the H-2A program to allow for full time immigrant workers and has many other important provisions. The bill is not perfect but it is a start. It has caps that limit the number of ag workers allowed in the U.S. each year which presents a problem and needs to be fixed. The wage structure in the bill needs to be remedied. The present Adverse Effect Wage Rate as established by DOL varies greatly around the country from a low of $11.81 per hour to a high of $16.35. Annual increases as determined by DOL in the Adverse Wage Rate can be extremely high percentage wise and therefore very costly in terms of labor expenses to farmers. There are also concerns that farmers are not protected adequately from employer liability under this legislation. The definition of “labor” needs to be improved. Also, cost reductions need to be considered in the paper work involved in hiring practices. All of these improvements can be completed during the legislative process.
The Senate has held hearings on the need for Agriculture Labor Legislation back in July but so far as previously stated no bill has emerged at the Judiciary Committee level.
Both the House and Senate are considering a $3.5 Trillion Budget Reconciliation Bill that is scheduled for a vote in the next few weeks. It contains many expenditures for affordable housing, climate change, Medicare expansion as well as tax provisions to pay for the costs. In addition the House Bill will have a provision that would give citizenship to “essential farm workers” meaning that current undocumented immigrant workers already in the U.S. on dairy operations and other businesses would become U.S. citizens. A key sticking point with this provision is that it must pass muster with the Byrd Rule in the Senate as reviewed and approved by the Senate Parliamentarian. It is not a budget or tax related issue per se so the question of whether it survives the Byrd Rule test is an open question.
Special note: On Sept. 19, the Senate parliamentarian ruled against allowing Democrats to include a pathway to legal status for an estimated 8 million undocumented immigrants in their massive social spending plan. The decision by the Senate’s rules arbiter is a blow to congressional Democrats and the White House, who viewed the legislation as their best chance this Congress to enact immigration reform.
Democrats argued that providing green cards to Dreamers, essential workers, farmworkers and those with Temporary Protected Status would affect the federal budget and thus complied with Senate rules. Lawmakers and advocates have vowed to offer alternative arguments to the parliamentarian.
So, you can see there are a lot of moving parts in play. The situation legislatively at this point can best be described as fluid. One important item I would add is what affect will the U.S. Mexican Border crisis have on getting any ag labor reform legislation passed this year? It is a major factor! We may have as many as 2 million illegal immigrants entering the U.S. this year. A number of members of Congress are very concerned with this and believe this problem needs to be resolved before any immigration reform can take place. What are the prospects of getting ag labor reform legislation passed this year? Probably 50/50 at best.
Editor’s note: For many years, the author represented the dairy cooperatives in the Northeast in Washington, retiring earlier this summer and moving to Tennessee. He was known as a knowledgeable and tireless advocate for dairy producers in the legislative process. Ag labor has been one of his longstanding issues. He helped organize and for well over 20 years served as head of an Agriculture Labor Coalition. It began primarily with ag organizations from the Northeast but was expanded across the country. The purpose was to track the legislative process and to set up Congressional meetings to push for legislation to help dairy farmers and other agriculture businesses that needed workers’ full time. We’re pleased that he will be contributing articles on legislative issues from time to time. He can be contacted at firstname.lastname@example.org