Tyson Foods is known for its chickens, but the company says all of its poultry is raised by independent farmers.
A decision by a Maryland appellate court last week calls that independence into question. The Court of Special Appeals ruled Friday that a farm manager who was disabled by a lung disease while caring for birds owned by Tyson was actually an employee of the food products giant.
The 3-2 decision by the appellate panel reversed a decision by the Worcester County Circuit Court and reinstated a decision by the Maryland Workers’ Compensation Commission.
“Taken in sum, Tyson’s extensive involvement in, and control over, Mr. Garcia’s day-to-day operation of the farm gave rise to an employment relationship as a matter of law,” the appellate panel said in a majority opinion written by Judge Alexander Wright.
Mauro Jimenez Garcia was hired as a handyman on Worcester County chicken farm in 2009. When the owner fell ill, he took over as manager. After the owner died, employees from Tyson Foods taught Garcia how to raise chickens according to Tyson’s standards.
Garcia stayed on after Dai K. Nguyen bought the farm as an investment. Tyson does not own any chicken farms. Rather it contracts with individual farmers.
Tyson, based in Springdale, Arkansas, says in its annual report that it has a “vertically-intergrated” process to raise live chickens, primarily by independent contract farmers. Once chicks have hatched, the company sends them to broiler farms. “There, contract farmers care for and raise the chicks according to our standards, with advice from our technical service personnel, until the broilers reach the desired processing weight,” the company said.
Tyson contracted with Nguyen as an absentee owner. Its contract required someone to stay on the farm 24 hours a day, seven days week to respond to any emergencies that might arise. Nguyen appointed Garcia as resident manager.
Tyson’s “broiler production contract” gave detailed instructions for raising a block of chickens. Tyson supplied the chicks and dispatched employees to visit the farm one to three times a week to check on the well-being of the birds.
When Garcia contracted a disabling lung infection in 2014, he learned that Ngyuyen, the new owner, did not have workers’ compensation insurance. The state Uninsured Employers Fund stepped in, but filed a claim against Tyson as Garcia’s “co-employer.”
The Workers’ Compensation Commission found that Tyson was liable for Garcia’s workers’ comp claim, but the company appealed. After a two-day trial, a Worcester County jury found that Tyson was not Garcia’s co-employer. The Uninsured Employers’ Fund appealed.
The UEF argued that Tyson was undisputedly Garcia’s employer. It informed him on the tasks that needed to be done and had the right to take control of its chickens and and terminate the contract if its instructions were not followed.
The appellate panel said under Maryland case law, there are five factors that determine whether an employer-employee relationship exists: The power to select and hire the worker, the payment of wages, the power to discharge, the power to control the employee’s conduct and whether the work is part of the employer’s regular business. The power to control is the most important of those factors, the opinion said.
The appellate panel noted that Garcia was required to remain on the farm 24 hours a day, seven days a week under terms of the contract. It provided an 18-page Broiler Growing Guide that gave detailed instructions. Tyson employees came to the farm two or three times a week to evaluate how Garcia was raising the chickens and told Garcia what tasks he needed to complete to improve his performance. Tyson even posted its own signs on the farm.
“Though we agree with Tyson’s general proposition that mere supervision is insufficient to establish an employment relationship, the company’s conduct here went well beyond that modest level of interaction,” the majority said.
Judge Steven B. Gould dissented. He noted that Nguyen — not Tyson — had the power to terminate Garcia as an employee, and he also had the contractual right to terminate the contract with Tyson. Citing a prior case, Gould cautioned the appellate panel not to “confuse control of the workplace with control of the worker.”
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