A closer look at historic gains for farmworkers in the CIW-Yum! Brands agreement

Exploring the how the “penny more per pound” actually works

In March of 2005, the Coalition of Immokalee Workers (CIW) and Yum! Brands, the parent company of Taco Bell, reached an historic agreement that ended the almost four year boycott of Taco Bell and achieved significant gains for farmworkers harvesting tomatoes in Florida. The agreement is discussed in extensive detail and additional historical background as well as educational materials are available on this Web site. By supporting the boycott, praying, writing letters, engaging in public witness, fasting, and convening talks between the company and the farmworkers, Presbyterians in all settings of the church played an invaluable role in advancing human rights for farmworkers and a new model for corporate socially responsible purchasing.

What principles were achieved in the CIW-Yum! Brands Agreement?

(a) the first-ever direct, ongoing payment by a fast-food industry leader to farmworkers in its supply chain to address sub-standard farm labor wages

(b) The first-ever enforceable Code of Conduct for agricultural suppliers in the fast-food industry (including the naming of the CIW, a worker-based organization, as an investigative body for monitoring worker complaints);

(c) Market incentives for agricultural suppliers willing to respect their workers’ rights, even when those rights are not guaranteed by law;

(d) 100% transparency for Taco Bell’s tomato purchases in Florida.

In this article we’ll focus on principle (a) the “penny more per pound” which establishes the principles of accountability and transparency within Taco Bell’s tomato supply chain.

Is Taco Bell paying a penny more per pound of tomatoes?

Yes! Many of you know that CIW had been asking Taco Bell to pay a “penny more” for each pound of tomatoes that the company purchased from its suppliers, and require those suppliers (Florida-based growers) to pass this increase along to the workers in their wages. This was accomplished and the increase was made retroactive to January 1, 2005. Workers who harvest for Taco Bell’s Florida tomato suppliers are receiving this benefit now.

How do we know that the penny Taco Bell is paying actually gets to the workers?

In the agreement, Yum! Brands agreed to open their books to the CIW on a monthly basis. This is an absolutely ground-breaking step and the first time in history there has been transparency in purchasing in the retail food supply chain. The CIW is able to see the amount of tomatoes Taco Bell has purchased and which growers have supplied these tomatoes. They then can see the payment records that the company makes to the growers. The growers, in turn, pay the workers by check on a weekly basis. On the check itself, is a line that says “Taco Bell bonus” and shows the calculated increase that has been added to the workers pay.

What is the penny per pound increase really worth?

While a penny more per pound of tomatoes doesn’t sound like a lot of money, it effectively almost doubles workers wages. Generally farmworkers are paid 40-45 cents for every 32 pound bucket of tomatoes that they pick. At this rate they have to pick 2 tons of tomatoes to earn $50. The Department of Labor reports farmworker median annual income is sub-poverty, namely $7,500. Workers wages have been stagnant for more than 25 years and have not been adjusted for inflation.

So when Taco Bell agreed to pay a penny more per pound, that meant that workers who are harvesting for the company’s suppliers are now earning 72 – 77 cents per bucket (depending on the grower). While this does not make up what the workers have lost to inflation, it is the first significant wage increase in 25 years. It has made an immediate impact on the lives of the workers and also established the principle that corporations who retail products are responsible for conditions in their supply chains.

For more information on the Presbyterian Church and our work with the Coalition of Immokalee Workers through the Campaign for Fair Food see our news archive or email us.