Kosher Plant Struggles as Owner Faces 
Arrest and Fines

By Marissa Brostoff

Published October 30, 2008, issue of November 07, 2008.
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The kosher meat giant Agriprocessors shut down major portions of its slaughter operations at the same time that the company’s former CEO was arrested and the state of Iowa imposed a $10 million fine on the meat producer.

On October 30, federal prosecutors arrested Sholom Rubashkin, son of Agriprocessors founder Aaron Rubashkin. The younger Rubashkin, who had run the company’s operations in the midwest, was charged with helping to procure false identification for undocumented immigrants who worked at the Postville, Iowa slaughterhouse.

The arrest came a day after the $10 million in fines, which the Iowa labor commissioner issued in response to the alleged failure of the company to pay proper wages to its employees.

“Once again, Agriprocessors has demonstrated a complete disregard for Iowa law,” said the labor commissioner, Dave Neil, in a statement.

Representatives for Agriprocessors did not return numerous calls from the Forward.

Rabbi Menachem Genack, head of the Orthodox Union’s kosher division, told the Forward: “We still have to evaluate what these events mean in terms of the viability of the company and sources of supply. We hope that this works out for him and his family, but obviously this is an ominous turn.”

Agriprocessors’s Postville plant was the subject of a federal immigration raid last May, in which nearly 400 immigrant workers were arrested. That raid came two years after an article in the Forward raised concerns about the treatment and pay of workers at the plant. In September, the owners of Agriprocessors were charged with more than 9,000 separate child labor violations, but until now, none of the members of the Rubashkin family had faced arrest in connection with problems at the plant.

Before the raid, Agriprocessors was the largest producer of both kosher beef and kosher poultry in the United States, and was the sole supplier of kosher beef to many parts of the country. In the days before the arrest and fines, the Postville plant had shut down its beef production.

“All the workers are walking the streets today,” Paul Ouderkirk, a priest at Postville’s Catholic church, said in an October 29 phone interview.

Jeff Abbas, who runs Postville’s community radio station, said that he saw live cattle being trucked away from the slaughterhouse on the morning of October 29.

Agriprocessors had attempted to deal with its problems by having Sholom Rubashkin step down as CEO of the company’s Midwestern operations. That move was announced in May, and in September the company brought on a New York lawyer to fill the post. The Rubashkins, however, are still involved in the company’s operations.

A special agent with the Department of Homeland Security wrote the affidavit that detailed the reasons for Sholom Rubashkin’s arrest. The special agent consulted a number of former Agriprocessors employees in drawing up the charges. According to the affidavit, Rubashkin personally helped procure fraudulent identification cards for undocumented immigrants working at the plant. In one case, Rubashkin allegedly loaned supervisors at the plant $4,500 in cash to pay for the cards, each costing $200.

Discussing one of the Agriprocessors employees, referred to as Subject A, the affidavit reports that “Subject A stated that Sholom Rubashkin inspected the first group of IDs and told him/her that, the IDs looked good to him, and that he would sign the I-9 Forms for the applications.”

Rubashkin was set to appear at a federal court in Iowa on October 30.

The charges against Rubashkin came shortly after an Agriprocessors human resources manager, Laura Althouse, pleaded guilty to federal charges that were filed against her because of her work at the plant. Althouse, who initially pleaded not guilty, has been charged with harboring undocumented workers and forging Social Security cards for them. She faces up to 12 years in prison and $500,000 in fines.

The fines that the company is facing are not related to the immigration charges. According to a statement released by the commissioner’s office, more than 2,000 workers had their wages illegally reduced within the past two years. Most of the fines are civil penalties accrued by the company for allegedly forcing workers to pay for their own uniforms. Additional fines were levied because the company allegedly withheld employees’ paychecks during the weeks after the raid.

Agriprocessors has faced a steady flow of fines over the past year, but these appear to be the largest. A spokeswoman for the commissioner said that the fines were the largest the department had ever leveled in connection with wage violations.

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