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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.