The fresh produce trade is one of the last labour-intensive food industries, requiring a vast number of seasonal workers every year to harvest crops as production hits its peak. The industry has for decades relied on overseas students to come to the UK, pick the crop and return home at the end of the season, having earned themselves a good wage in the meantime.
This year, changes to the Seasonal Agricultural Workers Scheme (SAWS) have stirred anxieties for UK growers, as many are reliant on the programme to provide much of their temporary labour. A squeeze on SAWS, from 25,000 workers last year to 16,250 this season, coupled with the restriction to students from Bulgaria and Romania, has resulted in well-documented labour shortages.
This has combined with a number of factors, including the flourishing economies in the likes of Poland and other eastern European countries and the growing aspirations of would-be migrant workers, compounded by the economic downturn in the UK, to make the problem worse than ever.
At the same time, demand for home-grown fruit and vegetables is continuing to rise, fuelled by the extension of domestic seasons and growing volumes. The sector is warning that if it is unable to find enough workers to harvest the crop, a number of categories will see a decline in investment, or even fruit and vegetables left in the fields.
So where does this leave UK horticulture in the short and longer term? And what can industry players do, now and in the future, to secure their businesses?
Defra figures show that labour costs make up between 40 and 70 per cent of expenses in horticulture, set against declining numbers of workers. A survey by the National Farmers’ Union (NFU) showed that, this year, 67 per cent of growers felt their business would be affected by labour shortages.
SAWS is set to be phased out altogether in 2010, but whether this will go ahead and what it will mean for an industry already struggling to recruit low-skilled workers remains to be seen.
A points-based system with tiers relating to the skill level of workers will then come into play but, to date, tier three - which would apply to low-skilled workers and therefore be of most interest to the horticultural sector - has been suspended indefinitely. If growers do want to bring in seasonal workers, they will have to make their case very strongly.
The soft-fruit category has been one of the worst affected by the threat of worker shortfalls, especially at the start of the season, given the labour-intensive nature of the harvest and the steady growth of the UK industry.
British Summer Fruits (BSF), which represents more than 90 per cent of the domestic industry, has teamed up with the NFU to lobby the government and raise awareness about the issue. The joint approach has so far succeeded in engaging both Jonathan Shaw, parliamentary under-secretary of state at Defra, and Liam Byrne, minister of state for the Home Office, in the discussion.
The next step will be to forge a relationship with the Migration Advisory Committee (MAC), which was appointed this year to make recommendations for future decisions on the subject.
BSF chairman Laurence Olins says that while the government may appreciate the situation that the industry finds itself in, it has wrongly treated SAWS as an immigration issue. “The government is very aware of the difficulties facing the horticulture industry; it recognises the contribution that the soft-fruit industry makes to the UK economy and it acknowledges the importance of SAWS, but politically, it has to be seen to be reducing immigration,” he explains. “Unfortunately, SAWS is seen by the electorate as related to permanent immigration, when it is really a seasonal programme.
“We have decided to start having an open dialogue with the MAC rather than the government,” he continues. “If we are short of labour, there is nothing to say that the MAC will not recommend the lifting of restrictions on SAWS. There are still question marks over a lot of things.
“Anecdotally, we know that growers have found it difficult to get the labour they need, but enterprising growers have found this a challenge and worked harder on the labour issue,” he adds. “For the moment, the hard work seems to be paying off, but if it had been hot in June, it would have been a different story. The problem has not gone away.”
Members of BSF and the NFU have been asked to provide empirical evidence for the effects of labour shortages but, to date, nothing has been received. Without firm data, it is unlikely that the MAC will be moved to take the action that the industry is looking for.
Robert Mitchell, a Kent top-fruit grower who has been chairman of Concordia for 10 years, stresses that the grower base must wield hard data in the fight to improve their options. He claims that the enlargement of the European Union “without the creation of a level playing field”, the increasing aspirations of the newer member states and the changing university structure in these countries - which has seen the average number of years at university drop from seven to three and therefore reduce the number of summer holidays in which they are available for seasonal labour - have all piled onto regulatory restrictions introduced this year, to spark worrying seasonal labour shortages in the UK.
“There is a lot of confusion in the media about seasonal migrant workers and permanent immigration, but there is no doubt over the status of a SAWS worker - they come, they work, they go,” he explains.
“Alongside this, there is a rather poor image of UK agriculture as an employment opportunity,” he adds. “Workers would rather be in the glasshouses in the Netherlands or Belgium, where they are protected from the vagaries of the weather, the working period is longer and their accommodation is free, than come to work in the UK.”
Marion Regan, chairman of KG Growers, has similar concerns. She has succeeded in recruiting enough workers for her Kent operation, Hugh Lowe Farms, but she is concerned that the number of new arrivals is in decline and that the situation will only get harder to navigate. “Some 49 per cent of the workers we brought in for this season have already left,” Regan explains. “Worryingly, the only ones staying are returnees from previous seasons. We are getting fewer first-timers to take their place, and the stream is drying up.”
She is adamant that despite the rise of unemployment in the UK - which has repeatedly been used to justify restrictions on workers from overseas - the trade cannot recruit locals to harvest their crops, even after concerted efforts. “One Scottish grower told me he had recruited 90 local people to start on Monday and, by Thursday, there were 13 left,” says Regan. “In my experience, advertising locally very rarely works and seems to attract dodgy, unregistered gangmaster types.
“We need workers who are flexible, quick and decisive, who are fit and healthy and have good personal hygiene, and can speak English or are at least good communicators.”
But the whole situation is an issue of calibre, as well as numbers, Regan adds. “We cannot get away from the fact that we need seasonal labour, and we must keep and extend SAWS as a well-regulated means of matching employers and employees,” she says. “The alternative could mean that we have to replace fresh, seasonal British berries with imports flown in from California.”
The struggle to find labour has been echoed across the UK production industry. S&A Davies failed to meet its target of 3,100 workers based on crop forecasts for the season, and was forced to settle for 2,800 instead. The Herefordshire-based producer of soft fruit, asparagus and sweetcorn has had to deal with the consequences of not finding the workers it needs to harvest its labour-intensive crops.
Jan Naerebout, operations manager at S&A Davies, says the workforce had to work overtime - paid at a higher rate - to pick the crop at its peak, with significant implications on costs. “Labour requirements have been increasing in line with growth in the soft-fruit category, and we expect them to keep growing,” he says. “It could have been a lot worse, but that is not to say the problem is not there this year. If the weather had been better, it would have been a bloodbath.”
The firm is looking into a process of improving its efficiency and, if planning permission permits, converting all the crops into table-top production, in a bid to attract and retain more workers.
“The margins are not there for us to pay more, so higher pay is not an option,” Naerebout adds. “But the uncertainty is the real problem - it will stop people investing if they don’t know how it is all going to work out; growers need to be confident that the fruit will be picked.”
The soft-fruit category is not the only sector to have been hit with the threat of labour shortages this season. David Piccaver, a Lincolnshire salad grower and chairman of the British Leafy Salads Association, is just one of many others facing up to the problem. He was one of four growers to trial the Student Worker Education Programme (SWEP) last year, which Concordia has now launched on a wider scale. The scheme, which has a higher education content, is aimed at students with a good grasp of English and fits in with the points-based system.
“We were a bit short of labour in the early part of the season in March, when we weren’t at all sure of numbers, but we can’t say that now,” Piccaver says. “We need to have seasonal migrant workers in our industry - we have all tried alternative forms of labour, but they do not work.
“Our next big concern is whether the workers that we do have will stay until the end of the season, because we will have another tough period from the second week in October, before the end of the season in November.”
He admits, however, that the salad category has not been hit as hard as the soft-fruit sector. “But the whole of the fresh produce industry is now geared around seasonal workers and, if you take that away, it will cause a lot of problems,” he insists.
The potential solutions to the problem, both in the short and long term, in many cases require the investment of time and money from the trade. There are a number of strategies that can make the situation easier on a micro level but, Mitchell insists, the trade must not lose sight of the macro solutions.
The more practical answers to the problem centre on growers giving workers better opportunities to earn more and achieve better continuity in their roles, as well as improving productivity and offering attractive accommodation and facilities. The specific selection of employees according to whether they are suitable for a task, the use of champion pickers as role models and an organised approach to production peaks could all help make up for shortfalls for individual growers. The creation of a database of workers and their families and friends can help producers stay in touch and encourage them to return for another season.
“If we cannot get more labour, we have to make better use of the workers we have,” Mitchell says. “At the same time, we should look at any mechanisation aid that might increase efficiency.
“You have to put yourself in the position of the worker,” he continues. “We have to think, how old is that coat of paint in their accommodation or look into the use of different facilities for couples or older workers. And you have to consider better rates of pay, because if that is linked to increased efficiency per unit harvested, it might not cost more in the end.”
To tackle the main issues on a broader scale, growers are being urged to lobby for an increase in the SAWS quota and, in the longer term, for the retention of the scheme after 2010.
“The SAWS model is workable and well established, and could easily run under the points-based system - but we have to be able to prove turn-up rates, length of stay, earnings, suitability for the job and reliability, and we need these statistics from the grower base,” Mitchell says.
Tony Botsman, who has devised three main technical solutions to improve labour efficiency through Aeropick Europe Ltd, says the industry should come together to invest jointly in technical solutions, to increase efficiency and push down labour requirements to the lowest possible levels. “Whatever happens with labour supply, it is always going to more expensive because of the rapid growth of the economies in some of the key countries,” he says. “So what you are left with are technical solutions.
“There is a multi-million pound opportunity for organisations able to help close the mechanisation gap between agriculture and horticulture, because when it comes to broad-acre agriculture, one person can handle 100 hectares with three machines and labour costs are around 10 per cent. The bottom line is that at the heart of agriculture is automation, but horticulture has been left behind.
“We won’t be able to do away with labour and seasonal workers in the next five years at least, but there is an opportunity to make a start.”
Aeropick first attempted to introduce designs for inflatable conveyors to move empty trays to pickers and full trays to weighing stations, aimed at the soft-fruit industry, but four years and £500,000 later, product development could not be completed. Three more finite solutions became apparent - a design for down-the-row planting and harvesting, one to automate the cut-flower harvest, and a carousel system as a longer-term solution for intensive soft-fruit production - which the firm has developed in consultation with the industry.
To complement his involvement in the fresh produce sector, Botsman is the founding director of a three-year-old initiative aimed at ensuring a community welcome for all visiting agricultural workers. The Ledbury-based scheme has just confirmed Adam Munthe, chairman of the Historic House Trust, as its founding patron, and a number of national initiatives will be confirmed shortly. “The objective is quite simply to ensure a welcome from the community, as much as from employers, helping to ensure the best possible experience for visiting workers,” Botsman says.
The long-term solutions to the labour problem lie within the resources of the industry, Olins insists. “The sector will have to find higher-yielding varieties so that harvesting becomes easier, invest in table-top production and in mechanisation, such as rigs,” he explains. “All these are answers to an increasingly difficult problem with labour, and they are resources we already have. None of them are easy or cheap, but we do have it in our own power to help ourselves, so we can’t blame others for our own shortcomings and, in the long term, they are more sustainable solutions.”
THE ASSOCIATION OF LABOUR PROVIDERS WATCHES OVER THE ISSUE
Growers will encounter issues resulting from the ever-evolving workforce and workplace, but the industry has a moral, legal and ethical duty to maintain the safest possible environment for both the directly employed and temporary workforce, says Jerry Camp, operations manager at the Association of Labour Providers (ALP).
Food supply chains are often complex affairs, with food manufacturers not necessarily knowing which labour providers are being used in the production of all ingredients. The use of sub-contractors to fulfil short-term labour requirements can mean a loss of control by the labour user. In our experience, retailers and their suppliers are vulnerable to criticism in having weaknesses in their supply chains regarding the management of their temporary workers. Many growers across the UK do not understand the implications of the Gangmasters Licensing Act and the requirement to only use licensed labour providers. By incorporating regular checks against the Gangmasters Licensing Standards, labour users can drive up the quality standards of labour provision.
The ALP is the specialist trade association for organisations that provide and use temporary, contract and seasonal workers within the food supply industry. The body is a centre of expertise and good practice on temporary labour issues for both labour providers and labour users alike, acting as a technical one-stop shop and providing commentary, statistics, guidance and advice on all legal and other regulatory developments of relevance to labour provision.
We work with the Gangmasters Licensing Authority (GLA), the National Farmers’ Union, labour providers, labour users and the major food retailers to raise standards within the industry and to help ensure workers are treated ethically and legally.
The GLA is the regulator responsible for issuing licences to labour providers that supply hundreds of thousands of workers to the food industry, which welcomes the flexibility that this workforce affords.
More than 1,200 gangmasters are now licensed to operate legally in the UK, with the majority of workers coming from countries such as Poland, Romania, Slovakia, Hungary, Bulgaria, Lithuania, Latvia, India, Pakistan and Portugal.
The Gangmasters Licensing Act comprises 10 standards and approximately 60 sub-sections. GLA inspectors will seek to assure themselves that the labour provider understands their obligations and is compliant with the law on accommodation, transport, health and safety, sub-contracting, worker pay, GLA licensing, HMRC payments, worker treatment, hours worked, recruitment and contractual arrangements, identity issues, under-age working, legality and the rights of workers. Where workers are supplied to the agricultural sector, labour providers and growers will also be expected to comply with the relevant Agricultural Wages Order (AWO). The GLA expects there to be a high standard of record-keeping and for the principal authority of the labour-providing business to be a ‘fit and proper’ person.
Labour users, including growers and food manufacturers, are legally required to use only GLA-licensed labour providers.
Since the Gangmasters Licensing Act became law, there have been large numbers of labour providers who have fallen foul of the law. The GLA has uncovered worker exploitation and illegal activity that has led to the revocation of more than 60 labour provider licences, including many labour providers to the agricultural industry.
GLA chairman Paul Whitehouse repeatedly describes the worst examples of labour provision as “modern-day slavery”, having uncovered workers housed in overcrowded and unsafe accommodation, transported in unsafe or unlicensed vehicles, paid less than the national minimum wage or the agricultural minimum wage and given inadequate health and safety training.
Migrant workers often arrive in the UK with little understanding of UK culture and with little money. During this time, these workers are vulnerable to abuse by some unscrupulous labour providers looking to make a quick buck. Other labour providers, although not deliberately abusing workers, are non-compliant with the complex law that exists as part of the regulations. The main reasons for non-compliance include labour shortages, cost and competition pressure, lack of time, poor management, as well as greed, ignorance and collusion.
The GLA acknowledges that it has limited resources, and labour providers are unlikely to be inspected more than once every three years, unless intelligence received leads to a multi-agency raid onto a labour user site.
This year, the enforcement body has adopted a ‘name and shame’ policy and fully intends to maximise media publicity to ensure worker exploitation is removed from the food industry. But a GLA licence is not enough to protect brand and management credibility.
The workforce of 2008 is a complex entity with considerable issues, involving a hugely diverse workforce with substantial cultural, religious and language challenges, so it can be tough for labour users to take responsibility for healthy and safety, as well as training on site. The effective management of health and safety and the use of the ‘statutory excuse’ if found to be using illegal workers are just two complex areas where a labour user needs to work with their labour provider and obtain professional guidance.
This summer, the ALP has launched an Agency Labour Best Practice and Audit Tool, which enables labour providers, labour users and professional auditors to conduct the due diligence necessary to protect the ethical reputation of businesses.
This tool has been welcomed by the GLA, which claims it could help curb the exploitation of workers as a useful indicator of labour use compliance.
The self-audit tool enables non-audit specialists in the quality assurance, technical and operations teams to easily follow the guidance supplied and to ensure there is compliance by labour providers against the GLA standards, including recruitment law, employment law, and health and safety regulations.
Businesses are using the tool and the reports it creates to enhance their corporate and social responsibility commitment, as well as protect their brand. The regular updates to the tool help maintain ongoing legal compliance.
Labour users find this software easy to use and believe it enhances the likelihood of success during formal GLA compliance inspections. Those providing and using labour are sharing audit findings to deliver a safer working environment and better protected, productive workers.
The ALP, which is committed to improving worker conditions, is delighted to support the agricultural industry.
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