PRINTER'S NO. 824
No. 758 Session of 1979
INTRODUCED BY STUBAN, ZELLER, YAHNER, CALTAGIRONE AND
D. R. WRIGHT, MARCH 20, 1979
REFERRED TO COMMITTEE ON AGRICULTURE AND RURAL AFFAIRS,
MARCH 20, 1979
AN ACT
1 Empowering the Department of Agriculture to certify certain
2 marketing and bargaining associations for marketing of
3 agricultural commodities and regulating the marketing and
4 bargaining process.
5 TABLE OF CONTENTS
6 Section 1. Short title.
7 Section 2. Declaration of purpose.
8 Section 3. Definitions.
9 Section 4. Application for accreditation.
10 Section 5. Accreditation.
11 Section 6. Appeal on denial of accreditation.
12 Section 7. Effective date of accreditation.
13 Section 8. Revocation of accreditation.
14 Section 9. Association to be sales agent.
15 Section 10. Marketing and bargaining committee.
16 Section 11. Unfair practices of processors and associations.
17 Section 12. Bargaining defined.
18 Section 13. Notification of commencement of negotiations.
1 Section 14. Mediation procedures.
2 Section 15. Basis for mediation and bargaining decisions.
3 Section 16. Time limit upon decisions.
4 Section 17. Violation procedure.
5 Section 18. Rules and regulations.
6 Section 19. Effective date.
7 The General Assembly of the Commonwealth of Pennsylvania
8 hereby enacts as follows:
9 Section 1. Short title.
10 This act shall be known and may be cited as the "Agricultural
11 Marketing Act."
12 Section 2. Declaration of purpose.
13 The General Assembly finds that the production and marketing
14 of agricultural commodities constitutes a basic and essential
15 industry. Agricultural producers do not now enjoy the
16 opportunity, comparable to that of industrial workers and those
17 in many other forms of enterprise or employment to organize and
18 bargain effectively. Since agricultural products are produced by
19 numerous and often scattered individual producers, the marketing
20 and bargaining position of individual producers will be
21 adversely affected unless they are free to join together
22 voluntarily in cooperative associations or other associations as
23 authorized by law. Membership of a producer in such a
24 cooperative association or other authorized association can only
25 be meaningful if a marketer of agricultural products is required
26 to bargain in good faith with an agricultural cooperative or
27 other authorized association as the representative of the
28 members of such association. Adequate government provision is
29 not available to assure that the bargaining process shall be
30 fair both to producers and marketers and in the public interest.
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1 It is the intent of the General Assembly by this enactment to
2 eliminate the deficiency present in the bargaining for marketing
3 of agricultural commodities.
4 Section 3. Definitions.
5 The following words and phrases when used in this act shall
6 have, unless the context clearly indicates otherwise, the
7 meanings given to them in this section:
8 "Agricultural commodity." Includes all agricultural goods
9 produced for marketing or processing as defined by the secretary
10 and the price of which is not regulated by the State or Federal
11 Government or traded over the counter on the commodity exchange.
12 It does not include any commodity sold by a producer to another
13 producer for his own exclusive use and not for resale. The
14 kinds, type and subtypes of products to be classed together as
15 an agricultural commodity shall be determined by the secretary
16 on the basis of common usage and practice.
17 "Association." An association of producers, or federation of
18 cooperative association of producers engaged in producing,
19 marketing, bargaining, shipping or processing functions of an
20 agricultural commodity on behalf of its members who are
21 producers of such agricultural commodity, which has been
22 accredited by the secretary.
23 "Department." The Department of Agriculture.
24 "Marketer." A person engaged in the business or practice of
25 acquiring agricultural commodities from producers or
26 associations for processing or sale; grading, packaging,
27 handling, storing or processing agricultural commodities
28 received from producers or associations contracting or
29 negotiating contracts or other arrangements with producers or
30 associations with respect to the production of any agricultural
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1 commodity; or acting as an agent or broker for a marketer in the
2 performance of any function or act specified above. It does not
3 include a producer who sells at a retail establishment which he
4 owns and operates or who sells at a produce market, agricultural
5 commodities produced by him and agricultural commodities
6 produced by another producer subject to value limitation
7 established by the secretary.
8 "Marketing year." The secretary shall determine the 12 month
9 period for a specific agricultural commodity to be designated as
10 its marketing year.
11 "Person." An individual, partnership, corporation or
12 association.
13 "Processing." Any person slaughtering poultry and livestock,
14 or converting fish, seafood, milk, butter and dairy products,
15 meat, eggs and poultry or poultry products into food products;
16 it also means the converting and/or manufacturing of fruits,
17 vegetables, crops and other agricultural commodities into
18 marketable food items.
19 "Producer." Any person, who in any one calendar year within
20 the previous two calendar years, produces any agricultural
21 commodity in quantity beyond his own family use, and who is able
22 to transfer, during the calendar year, to a marketer or
23 processor or any association a merchantable title to the
24 agricultural commodity or provide management, labor, machinery,
25 facilities, or any other production input, with the assumption
26 of risk, for the production of the agricultural commodity for
27 marketing of processing purposes.
28 "Secretary." The Secretary of Agriculture.
29 Section 4. Application for accreditation.
30 (a) Bargaining authorized.--Any association accredited
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1 pursuant to the provisions of this section may engage in
2 bargaining in accordance with this act.
3 (b) Request for accreditation.--An association desiring
4 accreditation shall file with the department a request in the
5 form required by the secretary. The request shall contain
6 properly certified evidence that the association meets the
7 standards for accreditation and shall be accompanied by a report
8 of the names and addresses of member producers. A fee to cover
9 the costs of the department in processing the request shall be
10 established and paid by the association when the request is
11 filed.
12 (c) Reports.--The secretary may require all marketers of an
13 agricultural commodity produced in a bargaining unit area as
14 individuals or through their trade association to file with the
15 board within 30 days following such a request, a report,
16 properly certified, showing the number of producers of the
17 agricultural commodity who have delivered the agricultural
18 commodity to the marketer during the two calendar years
19 preceding the filing of the report and the quantities of the
20 agricultural commodity received by the marketer from each
21 producer during those periods.
22 (d) Further information.--In case of dispute by either party
23 as to the volume of commodity produced in the bargaining unit,
24 the secretary may require names, addresses and quantities
25 received of all producers by the marketer.
26 (e) Reports confidential.--The information contained in the
27 individual reports of marketers filed with the department shall
28 be for use by the department and shall not be made public by the
29 department nor available to any person for private use.
30 (f) Bargaining unit area.--In determination of
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1 accreditation, the secretary shall determine whether bargaining
2 shall be appropriate for the industry. This determination shall
3 be the unit area for the bargaining provisions of this act as is
4 applicable to associations and marketers. In making his
5 determination, the secretary shall define as appropriate the
6 largest bargaining unit area in terms of the quantity of the
7 agricultural commodity produced, the definition of the
8 agricultural commodity, geographic area covered and number of
9 producers included as is consistent with all the following
10 criteria:
11 (1) The effect of exclusions on the capacity of the
12 association to effectively bargain for the bargaining unit as
13 defined.
14 (2) The kinds, types and subtypes of products to be
15 classed together as agricultural commodity for which the
16 bargaining unit is proposed.
17 (3) The pattern of past marketing of the commodity.
18 Section 5. Accreditation.
19 An association shall be accredited only if it complies with
20 all the following:
21 (1) The association meets the requirement of the
22 cooperative laws of the Commonwealth of Pennsylvania.
23 (2) The association has submitted a copy of its bylaws
24 which provide both that:
25 (i) Each member of the association present shall
26 have one vote in all votes of the membership of the
27 association.
28 (ii) Officers or directors shall be elected as
29 provided by the act of June 12, 1968 (P.L.173, No.94),
30 known as the "Cooperative Agricultural Association Act."
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1 (3) The association would have marketing bargaining
2 contracts for the current or next marketing year with a
3 sufficient number of the producers of an agricultural
4 commodity who are in the bargaining unit area and these
5 contracts would cover a sufficient quantity of that commodity
6 produced by producers in that bargaining unit area. The
7 secretary may determine the quantity produced by the
8 bargaining unit area using information on production in the
9 prior year, current marketing information, and projections on
10 production during the current marketing year. An association
11 whose main purpose is bargaining but which processes a
12 surplus into a form which is not the subject of bargaining is
13 not a processing cooperative. The contracts with members
14 shall specify the agricultural commodity and that the members
15 have appointed the association as their agent in negotiations
16 with marketers for prices and other terms of trade with
17 respect to the sale and marketing of the agricultural
18 commodity.
19 Section 6. Appeal on denial of accreditation.
20 Within 30 days of a decision by the secretary denying
21 accreditation to an association, the association may request a
22 hearing before the secretary. The secretary shall then conduct a
23 hearing to determine whether the association shall be
24 accredited. If the secretary, after this hearing has been held,
25 determines that the association should not be accredited, the
26 association may appeal his decision. Only an association denied
27 certification after such hearing may appeal under this act.
28 Administrative hearings held pursuant to this section, and
29 appeals taken from decisions of the secretary shall be in the
30 manner provided by law for the conduct of hearings by
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1 Commonwealth agencies and for the judicial review of agency
2 decisions.
3 Section 7. Effective date of accreditation.
4 Accreditation of the association by the secretary shall be
5 effective upon the receipt by the association of the notice of
6 accreditation from the secretary.
7 Section 8. Revocation of accreditation.
8 The secretary shall consider revocation of accreditation upon
9 any of the following conditions:
10 (1) Upon receipt of a request from an accredited
11 association for its own disaccreditation.
12 (2) Upon receipt of a petition requesting that the
13 accredited association be disaccredited and bearing the
14 signatures of at least 30% of the producers of an accredited
15 association in the bargaining unit. Following the receipt of
16 a petition bearing the signatures of at least 30% of the
17 producers of an accredited association in a bargaining unit
18 the board shall order the secretary to initiate a referendum
19 among the members of the accredited association and if in the
20 referendum a majority of the producers, producing a majority
21 of the commodity approve, the association accreditation shall
22 be revoked by the secretary.
23 Section 9. Association to be sales agent.
24 The accredited association shall represent all member
25 producers who are in the bargaining unit area and it shall act
26 as sales agents for the bargaining unit area in negotiations
27 with marketers. The association may not assess, bargain for, or
28 claim to represent those producers who are not members of the
29 accredited association.
30 Section 10. Marketing and bargaining committee.
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1 (a) Establishment.--After accreditation of the association,
2 the association shall establish and authorize a marketing and
3 bargaining committee to negotiate, as to association's exclusive
4 agent, with marketers for sale and marketing of the agricultural
5 commodity for which the association was accredited.
6 (b) Composition.--This committee shall be comprised of
7 members of the association elected by the association in a
8 secret ballot election, except that the association may contract
9 with legal counsel who shall, at the discretion of the
10 association, be eligible for membership on the committee.
11 (c) Production requirement.--The production of the
12 agricultural commodity shall comprise a significant portion of
13 the total producing operation of each committee member.
14 Section 11. Unfair practices of processors and associations.
15 (a) Unfair practices by marketers.--Producers of
16 agricultural commodities are free to join together voluntarily
17 in associations as authorized by law without interference by
18 marketers. A marketer shall not engage in any of the following
19 practices, defined as unfair practices:
20 (1) To coerce a producer in the exercise of his right to
21 join and belong to or to refrain from joining or belonging to
22 an association.
23 (2) To discriminate against a producer with respect to
24 price, quantity, quality or other terms of purchase,
25 acquisition or other marketing of agricultural products
26 because of his membership in or contract with an association.
27 (3) To pay or loan money, given anything of value or
28 offer any other inducement or reward to a producer for
29 refusing or ceasing to belong to an association.
30 (4) To make or circulate unsubstantiated reports about
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1 the finances, management or activities of associations or
2 other marketers.
3 (5) To conspire, combine, agree or arrange with any
4 other person to do or aid or abet the doing of any practice
5 which is in violation of this act.
6 (6) To refuse to bargain with an association with whom
7 the marketer has had prior dealing or with an association
8 whose producers in the bargaining units have had dealings
9 with the marketer prior to the effective date of this act.
10 (7) It shall be unlawful for a marketer to purchase a
11 product from an individual producer under terms greater than
12 those negotiated with an accredited bargaining association.
13 (b) Unfair practices by associations.--An association shall
14 not engage nor permit an employee or agent to engage in the
15 following practices, defined as unfair practices:
16 (1) To enter into a contract which discriminates against
17 a producer represented by that association.
18 (2) To act in a manner contrary to the bylaws of the
19 association.
20 (3) To make or circulate unsubstantiated reports about
21 the finances, management or activities of other associations
22 or marketers.
23 (4) To conspire, combine, agree or arrange with another
24 person to do or aid or abet the doing of any practice which
25 is in violation of this act.
26 Section 12. Bargaining defined.
27 For purposes of this act, the term "bargaining" means the
28 mutual obligation of a marketer and an accredited association or
29 their designated representatives to meet at reasonable times and
30 confer and negotiate in good faith. Negotiations may include all
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1 terms relative to trading between marketers and producers of the
2 agricultural commodity such as:
3 (1) Prices and terms of sale.
4 (2) Quality specifications.
5 (3) Quantity to be marketed by acreage or weight.
6 (4) Transactions involving products and services
7 utilized by one party and provided by the other party.
8 (5) Check off procedures pursuant to assessments levied
9 by the association, to be collected by marketers from
10 proceeds to producers within the bargaining unit.
11 Section 13. Notification of commencement of negotiations.
12 The association shall notify the department of the
13 commencement of negotiations.
14 Section 14. Mediation procedures.
15 (a) Supervision by department.--If no agreement is reached
16 at the expiration of ten days after service of such notice to
17 the department, the association may, at any time thereafter,
18 petition the department to assume supervision over the dispute,
19 except as provided for by subsection (c).
20 (b) Conference.--The department shall then set a time and
21 place for conference with the parties to present facts
22 representing each party's case and hearing arguments. The
23 department shall take such steps, in accordance with rules
24 promulgated under this act as it deems expedient to affect a
25 voluntary, amicable and expeditious adjustment and settlement of
26 the differences between the marketer and the association.
27 (c) Authority of department.--If the petition requesting the
28 department to assume supervision over a dispute is presented 15
29 days or less before the marketing year in dispute, then the
30 department shall exercise its discretionary authority, according
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1 to rules promulgated under this act, in determining which
2 disputes are arbitrable by the joint settlement committee before
3 the start of the marketing year in dispute.
4 (d) Joint settlement committee.--The secretary shall
5 establish a joint settlement committee to arbitrate all issues
6 in dispute. The committee shall consist of: three persons, one
7 person selected by the accredited association, one person
8 selected by the marketer and one person selected by agreement of
9 the persons representing the accredited association and the
10 marketer. The third person selected shall be the chairman of the
11 committee. If the third person cannot be agreed upon by the
12 accredited association and the marketer, the secretary shall
13 submit a list composed of the names and addresses of five
14 persons knowledgeable in the marketing of the agricultural
15 commodity from which the third person shall be chosen. Selection
16 shall be made by the accredited association representative and
17 the marketer representative each striking two different names
18 from the list. The remaining name shall be the person who serves
19 as the third committeeman and act as its chairman. The order of
20 striking shall be determined by lot.
21 Section 15. Basis for mediation and bargaining decisions.
22 All decisions of mediation and bargaining which result from
23 section 14 shall be based upon the following factors:
24 (1) Prices or projected prices for the agricultural
25 commodity paid by the competing marketers in the market area
26 or competing market areas.
27 (2) Amount of the commodity produced or projections of
28 production in the production area or competing marketing
29 areas.
30 (3) Relationship between the quantity produced and the
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1 quantity handled by the marketer.
2 (4) The producers cost of production.
3 (5) The average consumer prices for goods and services,
4 commonly known as the cost-of-living.
5 (6) The impact of the award on the competitive position
6 of the marketer in the marketing area of competing areas.
7 (7) The impact of the award on the competitive position
8 of the agricultural commodity in relationship of competing
9 commodities.
10 (8) A fair return on investment.
11 (9) Kind, quality or grade of the commodity involved.
12 (10) Amount of product carry-over.
13 (11) Such other factors which are normally or
14 traditionally taken into consideration in determining prices,
15 quality, quantity and the costs of other services involved.
16 Section 16. Time limit upon decisions.
17 The department shall announce its findings of fact and
18 decisions in all cases in which it has assumed supervision
19 during the year prior to the marketing year in dispute. The
20 joint settlement committee shall announce its decision within
21 ten days of the beginning of the market year.
22 Section 17. Violation procedure.
23 (a) Investigations and complaints.--For the purpose of this
24 act, the department may receive complaints with respect to
25 violations or threatened violations. The department may make all
26 necessary investigations, examinations or inspections of any
27 violation or threatened violation specified in the sworn
28 complaint filed with the department. If, upon such
29 investigation, the department considers that there is reasonable
30 cause to believe that the person charged has committed a
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1 practice in violation of this act, the department shall issue
2 and cause to be served a complaint upon the person. The
3 complaint shall summon the person to a hearing before the
4 department at the time and place fixed.
5 (b) Order of department.--If the department determines that
6 the person complained of has committed a practice in violation
7 of this act, it shall state its findings of fact and shall issue
8 and cause to be served on the person an order requiring him to
9 cease the violation and shall order further affirmative action
10 as will effectuate the policies of this act.
11 (c) Dismissal of complaint.--If the department is of the
12 opinion that the person complained of has not committed a
13 practice in violation of this act, it shall make its findings of
14 fact and issue an order dismissing the complaint.
15 (d) Modification of order.--Until the record in a case has
16 been filed in a court the department may, at any time upon
17 reasonable notice and in such manner as it deems proper, modify
18 or set aside, in whole or in part, any finding or order it has
19 made or issued, with jurisdiction for such a change specified in
20 additional findings of fact.
21 (e) Injunction, etc.--The secretary may request the Attorney
22 General to seek the appropriate temporary relief or restraining
23 order of injunction in Commonwealth Court to insure the
24 enforcement of the department's findings.
25 Section 18. Rules and regulations.
26 The department shall after a public hearing, promulgate such
27 rules and regulations as are necessary for the effective and
28 efficient implementation and administration of this act.
29 Section 19. Effective date.
30 This act shall take effect in 60 days.
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