Echoes of Atalissa: Federal agency sues bunkhouse owner for exploiting mentally disabled workers

Four years ago, an Iowa jury handed a group of intellectually disabled workers who had been exploited for years the nation’s largest-ever award in an employment discrimination case: a staggering $240 million.

It was intended to compensate 32 men for the decades they'd spent in indentured servitude while employed by Henry’s Turkey Service, a labor broker accused of paying the men as little as 41 cents an hour while providing them with housing in a dilapidated bunkhouse on the outskirts of Atalissa.

The jury's award was immediately slashed to just $1.6 million — less than 1 percent of the amount specified by jurors — because of federal caps on damages.

Even so, the verdict represented an uplifting final chapter in a long story of exploitation and abuse.

But now that story has an unexpected postscript.

Robert Canino, the Equal Employment Opportunity Commission lawyer who pursued the case against Henry's, is back in federal court.

This time, he's fighting Joseph Paul Byrd, a former Henry’s Turkey Service supervisor who took over the company’s Newberry, South Carolina, labor camp in the 1980s and kept it running for another 30 years.

In September 2016, the EEOC sued Byrd's company, Work Services Inc., alleging it had forced its intellectually disabled workers to live in a crowded, substandard bunkhouse, paid them “unconscionable wages” that were less than what nondisabled workers were paid, and subjected the men to a hostile work environment in which they were called “stupid,” “retarded” and “dumb.”

The company has denied the allegations, and a trial is scheduled for August.

"Sadly, the discovery of this situation, answers, in part, the question that has arisen since the disturbing Henry's Turkey Service operation came to light in Iowa a few years ago," Canino said. 

"After seeing how workers with intellectual disabilities had fallen between the societal cracks, being virtually invisible for decades, many have asked, 'Could there be any other situations like this out there or right in our own backyards?'

"The answer, sadly, turned out to be, 'Yes' — and what we found here serves to remind us all to remain vigilant against such abuse of our neighbors and co-workers."

Workers exploited at every turn

In a deposition taken last December as part of a lawsuit brought by the U.S. Department of Labor, Byrd acknowledged that the six disabled workers who lived in the two trailers that made up the Newberry bunkhouse were each charged $800 in monthly rent, while the three or four nondisabled men who lived there paid monthly rent of $150 to $200 each.

During his deposition, Byrd was unable to explain the disparity, except to say that he was maintaining practices established by his former employer, Henry’s Turkey Service,  decades ago.

“That’s just the way it was always done,” he told a lawyer for the Department of Labor. “That’s simply the way it was when I started.”

In his deposition, Byrd also acknowledged that he and his manager, David Perez, forged signatures on the disabled men’s paychecks and cashed them, then paid the men weekly allowances of $50 to $80 each.

Byrd also testified that he took the men’s disability checks as compensation for room and board and deposited the men’s tax refunds into a company account used to pay his personal and business expenses. 

According to Byrd, he began working for Henry’s Turkey Service in 1968, when the company was populating labor camps across the United States with intellectually disabled men recently discharged from state-run institutions in Texas.

Byrd said that because his job was to supervise the individuals running the various labor camps, he traveled from one site to the next, in Iowa, Texas, Missouri, Illinois, South Carolina and Kansas.

At one time, Iowa was home to three labor camps runs by Henry’s — in Ellsworth, Storm Lake and Atalissa.

In 1985, Byrd went into business on his own, purchasing the Henry’s labor camp operation in Newberry, South Carolina. At the time, he said, the bunkhouse consisted of 15 disabled men living in a set of trailers across the street from a turkey processing plant.

Over the next 30 years, the men who worked at the plant would arrive there in the morning, help unload live turkeys from trucks, hang them on hooks and kill them. It was, as Byrd later acknowledged, difficult and repetitive work.  

By 2009, some of the men had become too old or sick to continue working. A few of them retired but continued to live in the bunkhouse. The same was true at Henry’s last remaining bunkhouse, in Atalissa.

The Iowa operation already was winding down in February 2009 when a Des Moines Register investigation triggered a raid by state and federal authorities. All of the Atalissa workers were relocated to fully licensed care facilities, and the bunkhouse was shut down.

But Byrd’s South Carolina operation continued to do business until late 2014, when New York Times reporter Dan Barry, working on a book about the Atalissa operation, discovered the Newberry bunkhouse and reported that six of the original Henry’s workers were still living there.

Because of health problems, two of the men — Claude Wren and Johnny Hickman — had retired from work at the Louis Rich processing plant across the street from the Newberry bunkhouse, Byrd told the Department of Labor.

But the four others — Leon Jones, Carlos Morris, and Jay and John Koch — were still working at the plant and collecting $50 to $100 per week in compensation from Work Services.

Seeking compensation for the workers

According to corporate tax records, Work Services Inc. had annual gross receipts of almost $1 million at that time. An affiliate, Work Service Co., reported more than $600,000 in gross receipts.

In 2015, the U.S. Department of Labor filed suit against Work Services, Byrd and Perez, alleging they had failed to pay the disabled workers the legally required minimum wage; failed to pay overtime; and failed to keep adequate payroll records.

But the lawsuit was limited in scope: Under federal law, the department could seek payment of only two years’ worth of back wages.

In February, Senior U.S. District Judge Henry Herlong sided with the Department of Labor, granting the agency summary judgment before a trial could take place.

The judge called Byrd’s claim that the workers wanted the company to keep their wages for them “ludicrous,” and he ordered the defendants to pay $165,404 in back wages and damages.

Seven months later, the EEOC filed its own lawsuit against Work Services, alleging violations of the Americans with Disabilities Act.

The EEOC’s lawsuit, if successful, could result in far greater damages than the Department of Labor case, because it seeks compensation in three categories: money for the men’s financial losses; for emotional pain, loss of enjoyment of life and humiliation; and punitive damages for the “malicious or reckless conduct” of the company.

In his December 2016 deposition, Byrd acknowledged his bookkeeping at the bunkhouse wasn’t adequate — he kept thousands of dollars owed to the men stuffed inside envelopes hidden at his home, he said — but that he considered the workers family.

“I did a really poor job of keeping records,” he said. “I was trying real hard to take care of them and make their life a little easier and, hopefully, create a place where they could live the rest of their lives. … I had a lot of affection for each and every one of them. Well, when you’ve spent a third of your life or more with them, they become part of your family, nearly.”

Two of the disabled Henry's workers are related: Carl Wayne Jones and Leon Jones are brothers, just a year apart in age. They began working for Henry's in the late 1960s, but the company eventually split them up, sending Carl to Atalissa and Leon to Newberry.   

For decades, the two men didn't see each other.

But in 2014, Canino, the EEOC attorney, set up a Skype connection that enabled the two men, then in their mid-60s, to see and speak to each other for the first time in years.

According to the New York Times, Carl Wayne shared the news that their mother had died long ago; he also talked about his girlfriend and the group home in Waterloo where he lived with some of his friends from the Atalissa bunkhouse.

This year, Carl and his girlfriend got married. Leon rented a tuxedo and, along with some of his friends from the Newberry bunkhouse, traveled to Iowa for the wedding.

"I missed being there," Canino says, "but I am so happy the South Carolina and Iowa guys got to reconnect a bit — especially Carl and Leon."

Henry's Turkey Service still owes millions

No criminal charges were ever filed against Henry’s Turkey Service for the alleged financial exploitation of its Iowa workers, labor law violations, fire-code citations or the lack of a care-facility license at the Atalissa bunkhouse.

At the time, Iowa Attorney General Tom Miller said the better course of action was to have other agencies pursue civil remedies against company owner Kenneth Henry of Proctor, Texas, who was worth about $3 million.

Several state and federal agencies imposed administrative penalties, or won court judgments, against the company.

They eventually totaled $5.9 million, but Kenneth Henry refused to surrender any of his assets or enter into a payment-plan agreement with the federal government before he died in April 2016.

In recent years, however, the U.S. Department of Justice, the Equal Employment Opportunity Commission and the U.S. Department of Labor have aggressively pursued collection efforts.

To date, they have distributed roughly $800,000 to the disabled former employees of Henry's. They expect to soon collect an additional $900,000 from the estate of Kenneth Henry, which should bring the total recovery for the Atalissa workers to $1.7 million.

Here's a look at the various judgments and penalties imposed against Henry's:

• May 2009: Iowa Workforce Development imposed a $900,000 penalty against Henry's for violating state labor laws. The penalty was later increased to more than $1.1 million.
• November 2009: The U.S. Department of Labor sued the company for federal labor law violations, resulting in a court judgment against the company for $1.8 million.
• September 2012: After the company offered no resistance or defense to allegations that it violated the fair-wage provisions of the Americans With Disabilities Act, a federal judge ordered Henry’s to pay $1.3 million to 32 of its disabled workers.
• May 2013: An Iowa jury returned a verdict of $240 million against Henry’s Turkey Service for discriminatory employment conditions, but the jury verdict was later reduced to $1.6 million because of federal caps on damages in such cases.

Full Article & Source:
Echoes of Atalissa: Federal agency sues bunkhouse owner for exploiting mentally disabled workers