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News
Winery fined $115k over volunteers to close
A Californian winery has been forced out of business after it was fined $115,000 for using volunteer labour.
Westover Winery in California’s Castro Valley
As reported by the San Jose Mercury News, Westover Winery in California’s Castro Valley, which turns a profit of just US$11,000 a year, is expecting to close before the end of the year with the state-enforced fine effectively crushing the business.
According to the Department of Industrial Relations (DIR) the winery’s volunteers, many of which were there to learn how to make wine, were “illegally unpaid labourers” and its owner, Bill Smyth, should have been paying them and they in turn taxes.
Under Californian law, for-profit businesses are prohibited from using volunteers, however volunteers are common at wineries with many willing to work unpaid for a chance to learn the trade from the ground up.
As news spread of the fine, several wineries in the area were said to have sent their volunteers home.
The Wine Institute, which represents more than 1,000 California wineries, also advises its members not to use volunteers.
Speaking to the paper Peter Melton, a spokesman for the state, said Westover was cited in July for not paying minimum wage, not providing wage statements and not paying workers’ compensation insurance adding: “People should be paid for their labor. The workers’ compensation violations are very serious. What happens if someone has a catastrophic injury at the winery?”
Smyth plans to shut down his business before the end of the year with the fines said to represent a decade’s worth of profit for the winery which nets just $11,000 a year.
He said: “There’s just no money left; they’ve taken everything. We’re a small winery, open only 10 hours a week. We didn’t really need any helpers; we were just educating people about wine.”
When asked why the DIR didn’t first warn Smyth that the use of volunteers was not allowed, Melton said the law did not allow for warnings.
The family-owned winery has been producing wines, ports, champagnes and sparkling wines for the past 20 years after its founder William Westover Smyth purchased the Palomares Canyon winery property in 1986.
How utterly ridiculous. Since when did personal freedom get outlawed in this state? If this guy wants to teach these people how to make wine and they want to learn, that’s there own business. Perhaps the “state official” should be a bit more concerned about the chance of “catastrophic injuries” occurring on their poorly maintained roadways.
There should be a provision where the little winery could have the option to become a non-profit – with such small profits, they may as well become one – for the purposes of training people.
Well, this is what the masses vote for, bigger and bigger government thinking “they” will keep us safe. Time to wake up to a thing called Freedom.
This is again BIG GOVERMENT out of control.Do we not have more important issues facing us then harassing a small business owner.I have been in the wine industry for 31 years and very proud of it.Mr. Melton you are misguided,misinformed andan idiot.
I hate to say it, but I think it’s long overdue. I volunteered at a couple of Livermore wineries on a regular basis for almost 2 years. I wanted to make the transition from volunteer to full time winery employee – but guess what – there aren’t any. Why buy the cow when you can get the milk for free? And, frankly, you get what you pay for. Livermore has so much potential, but many of the wines will continue to be sub-par compared to other regions if winery owners don’t invest in their business by hiring good, qualified employees. A FAR majority of Livermore wineries operate this way. The work comp issue is extremely valid as well. One injury would result in a lawsuit that would shut the doors for good. So shutting the doors before someone gets hurt…well…it’s the right thing to do.
We cannot avoid the issue of workers compensation. The “big gov” argument ignores the legitimate question of who pays if a worker is injured or killed. Let’s face our true challenges, protecting volunteers from serious injury. How do we handle that?
so what about all the interns working at restaurants and other companies ..are they done for?
Ridiculous!!! California is out of control.
UC Davis has a winery. Are the student workers paid?
Many are artisans and in the end only make money if they are fortunate. It is a whole lot of bullcrap for the state to be this microregulatory. People should be responsible for them selves not relying on someone else for their work errors in getting hurt. I certainly pay for my own pain and suffering and workmans comp is a real scam anyway. People are a bunch of coddled waste of society anymore. An employee is never an investment only an expense and you never get back what you spend on them. You only hope to overcome the expense and have some gain from it in the end product. Other wise it is better to spend on technology and have some depreciation expense as well as better return on efficiency. Volunteers as such are usually more valuable than an employee, as the motivation and reason for being there are different. Pay them and you might as well be flushing the money down the toilet for a micro small business and you will not survive. Repressive regimes need to end in every state that is totally unreasonable and anti liberty.
The word volunteer means just that, you are volunteering your time. you literally start out knowing that you’re not going to get paid, and if you have a problem with that, remember one thing, you are the idiot that signed on to not get paid!! and as far as the workers comp “problem” goes, there are plenty of insurance policies out there that would cover anybody in the event of an injury on their property. with that being said, i agree. there should definitely be a rule that proper insurance is provided, but if somebody “volunteers” then there shouldnt be anything the government is able to say about it other than making sure proper insurance has been provided. and in no way should a crippling $155,000 fine ever be issued. FUCK the Government!! and if you dont like me saying that then, FUCK YOU TOO!!
Labor has to be paid for. If producers don’t pay the full costs of their labor inputs, then the rest of us will end up paying for it, probably through taxes.
The word “volunteer”means..work for no wages…if you sign up to be a volunteer, then you are accepting a no wage situation…pure and simple. If you don’t want to volunteer, don’t. Go work somewhere and get paid. There are many volunteers in this world, that enjoy doing that just, helping people, while learning. Remember the “pink ladies” at the hospitals? What about volunteer car washes for high schools? CA used to be a beautiful place to live..now, it has turned into one big governmental mess. Get out, and don’t look back…I did, and I can volunteer in my new state without the government intrusion.
ABC 7 said it was over $130,000.00 in fines and this article said both $115,000.00 and $155,000.00 so what was the fine? Considering that Bill Smyth has a full time position with a medical supply company and his wife has a hair dressing business, this winery was a Hobby and labor of love of his family and only the Wedding Partys and special events, catered by others, realy made any money. There goes another mom and pop business, that specialized in fun for us locals, in the San Francisco Bay Area..
A volunteer is a volunteer. If getting experience to round out your resume to target your career goals..more power to you for your personal choice. Problem being ( and I am not saying this winery is the case) is that so many wineries take advantage of this. For the most part, it is not a high profit business and free labor is coveted. Little reward for free labor. But as long as agreement is mutual….state should back off.
when is the state going to stop about this petty stuff…. How about the parents who volunteer at the school for their kids…. can they not do this anymore…… this is a fine line that the state is doing…. the state needs to be less worried about the little stuff and the few TAX dollars they are missing and worry more about the big picture of helping business stay and remain in this state, not having the businesses wish that they never began……
Why does anyone choose to do business in California. The State is financial catastrophe. It’s politicians are liberal Democrat wacko’s that have put a noose around businesses that operate there. California is a beautiful resource rich State that thanks to it’s political leadership it’s future is flushed down the toilet. Come to Texas we will treat you better, no State Taxes and conservative leadership. We are not perfect, but at least we are headed in the right direction.
The Workers Compensation is NOT an issue. If you have a workers compensation policy it covers all “employees” by any definition. If a volunteer employee is injured on the job they are covered under the winery’s workers compensation policy.
I am an insurance broker and a winery owner, and I can assure you that is the case. If you have a question check with your agent.
The minimum wage issue is totally different and should be checked out as well though. Many industries hire unpaid interns, so I wonder how that works in this context.
You can’t escape big brother anymore. My only advice would be to teach wine making classes and charge a fee as they do in a university setting. In this way they are students and liability is limited. Other than that I can only say that the wine in France and Italy is far superior so hop on a flight and see what wine tastes like without sulfides. What a difference.
So what about the interns in the government i.e MONICA LEWINSKY? Same rule applies to them. Answer that one Moonbeam! Which brings to mind MANDATORY RANDOM drug testing for ALL politicians starting with the PRESIDENT!