Agriprocessors paid its laborers far less than the prevailing wage for the kind of work they did. If Agriprocessors had been given a chance to phase out undocumented workers (which it could likely have done only by paying fair wages to legal workers), it may have been able to avoid bankruptcy. Paying fair wages might have forced it to charge more for its products, but it apparently had limited competition given the reported shortage of kosher meats that resulted from Agriprocessors' distress. Higher consumer prices are a small price to pay for an adequately paid, safe workforce.
Perhaps Agriprocessors deserved to go out of business. It fiercely resisted unionization, choosing to employ undocumented workers (who, of necessity, work for low wages) rather than paying a fair wage that would have attracted legal workers. Its violation of child labor laws and the abusive work environment it provided were more than sufficient reason for consumers to look elsewhere for kosher foods.
Yet it's clear that the State of Iowa dropped the ball in failing to detect and to remedy the labor law violations long ago. Iowa's labor law regulators and Agriprocessors battled regularly over the company's employment practices. Still, if Iowa's regulators had been more aggressive, Agriprocessors may have cleaned up its act and stayed in business -- helping the economy in a small town that now has to weather the closing of an important local employer. Maybe Agriprocessors' owners were so incorrigible that they just wouldn't comply with the law no matter how much heat the State applied, but it isn't at all clear that state regulators turned the heat up to the temperature needed to make Agriprocessors obey the law. If it's cheaper to pay fines than to comply with regulations, that's what some businesses do.
Now it's probably too late. Not only will legal employees lose their jobs if Agriprocessors does not survive bankruptcy (and it appears from the linked article that it won't), but local businesses that depend on Agriprocessors' employees spending their paychecks locally will also suffer. The loss of a company that brings in $300 million a year will be dearly felt in Postville and surrounding towns.
The lesson to be learned here has less to do with immigration reform than with the need to revitalize labor law. It should not have been so easy for Agriprocessors to resist unionization. It should not have been possible for a major employer to hire child labor. Yet since the Age of Reagan, government has more often seen unions as evil than as a mechanism for assuring justice in the workplace. Labor laws that promote unionization have been weakened, and the enforcement of laws addressing workplace safety and labor standards has been a low priority. A renewed commitment to unionization and to the enforcement of fair labor standards is necessary to prevent more businesses from engaging in the self-destructive greed that toppled Agriprocessors -- greed that will cause suffering in Postville for years to come.
