The U.S. House of Representatives has voted to give small chicken farmers more power in their dealings with large poultry companies. A provision was put in the $290 billion farm bill by amendment, which would ban mandatory, binding arbitration in the farmers’ contracts with the giant poultry companies. Interestingly, President Bush has threatened to veto the legislation. But the overwhelming support in the House – it passed 318 to 106 – means lawmakers will be able to override his veto. The poultry measures, which have attracted little attention in the farm bill debate, would affect the contracts small chicken growers sign with big poultry companies like Tyson and Purdue.
The growers go deeply into debt to build houses in which to raise the chickens and they operate with profit margins that are extremely thin. And, many growers complain, the relationship vests too much power with the poultry companies. Companies can generally cancel contracts at any time with little notice, leaving farmers holding the bag and often times facing bankruptcy. If a dispute arises, the contracts generally ban a farmer from going to court, instead mandating binding arbitration. The provision referred to above would ban mandatory binding arbitration, allowing poultry growers to retain their option of going to court to settle disagreements. Lobbyists for large poultry companies oppose the legislation, saying that “binding arbitration is in everyone’s best interest.” That’s about as false a statement as could possibly have been made. Hopefully, this ban on arbitration will stand.
Source: Media General News Service
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