Volunteers

Legal Definition

What is a volunteer? The law defines a volunteer as someone who performs service for charitable or humanitarian reasons for a nonprofit or public agency without expecting compensation.

Does your farm meet the six criteria for a volunteer?

Folks are often willing to work on sustainable farms for “free.” Some want job training, others simply appreciate the opportunity to be out in nature and see where their food comes from. Is this okay? Yes, so long as the farm meets certain criteria. Both the US Department of Labor Wage and Hour Division (US DOL) and the Vermont of Labor (VT DOL) consider the following six factors when determining whether someone is a true volunteer.

1. The farm must be operating as a nonprofit organization

Legally speaking, a for-profit business cannot have a volunteer. The law defines employing someone as permitting someone to work for the business. The fact that the worker isn’t paid is not relevant—the farm is being helped and the farm owner is permitting the work. That means the worker is an employee (unless they are an intern or independent contractor). The federal definition of a volunteer is someone who is motivated by charitable or humanitarian reasons for a public agency with no expectation of receiving compensation for her services. So, volunteering for a for-profit business just doesn’t work under the dominant legal paradigm.

The reasoning behind this is again about preventing exploitation and coercion of workers. If a business could “persuade” employees to volunteer without any legal repercussions, the resulting economic and power dynamic would easily create unjust situations. A notion of fairness is also at play; if the business is operating to make money, workers deserve compensation for their labors.

Read further in Section 2, Managing Risks of Interns and Volunteers in Vermont, for more details on this criterion.

2. The worker works less than full-time

This factor protects the workers from coercion and exploitation. If a volunteer works full time for a nonprofit farm, they may become dependent on the farm for their livelihood. Let’s say the nonprofit farm has “volunteers” that work full time and the farm provides them room, board, and essentially all they need for their livelihood. This puts these workers in a potentially exploitative situation. The workers may feel pressured to do everything the farmer says to protect their living arrangement, even if unfair working conditions prevail. This is precisely the type of arrangement that employment laws protect. Nonprofit farms should be careful not to create such a dependency relationship. The best way to do this is to have the volunteers work only part time. This provides them opportunities to create a livelihood outside of the farm.

3. The worker offers the services freely, without pressure or coercion

The volunteer needs to have some level of autonomy. As the name depicts, a volunteer must “voluntarily” agree to the tasks at hand. While the farmer can provide instruction and direction, the farmer cannot force a volunteer to do arduous or repulsive tasks such as shovel horse manure for hours on end— unless, of course, the volunteer freely volunteers to do it!
In addition, the non-profit farm cannot force a regular employee to perform volunteer services for free. Forcing an employee to volunteer is by no means volunteering! With that said, the farm can have a one-off event, such as a weekend fundraiser, and open up volunteer opportunities to regular employees. However, the farmer cannot require employees to participate or make it in any way a condition of continued employment.

4. The worker doesn’t expect to be compensated

This gets to the heart of the legal definition of a volunteer—someone who does not expect compensation for the services offered. If the worker expects compensation in return, they are not a volunteer. This brings up a couple key points.

First, farmers who provide some compensation to volunteers—whether in the form of cash or in-kind payments—should tread cautiously. By paying volunteers some compensations, the farmer risks making it look more like an employee arrangement. The “volunteer” begins to expect this compensation. Farmers in Vermont who are required to pay at least the minimum wage to their employees should strongly consider ratcheting up any compensation provided to volunteers to at least the minimum wage amount. Otherwise, they may be better off risking it and paying their volunteers no compensation, as it will look less like an employment arrangement. In Vermont, farms with 500 or more man-days must pay at least the federal minimum wage. A man-day is any day on which a person does at least one hour of work. Farms assigning non-agricultural labor tasks to workers must pay at least the higher Vermont minimum wage.

In addition, as mentioned earlier, a non-profit farm cannot suddenly require a regular employee to do the work they regularly do for free. For example, let’s say the farm is running low on cash. The farmer can’t ask the employee to work for free for a couple weeks to get the farm through a tough time. The law sees this as unfair to the employee who expects compensation for their work. The farm will need to figure out another way to make payroll.

5. Your nonprofit farm does not undercut prices to unfairly compete with other farms

In addition to protecting the workers, the law is also interested in protecting overall fairness in the marketplace. Nonprofit farms gain a bit of an advantage over for-profit farms given they don’t have to pay their volunteers. They can, in turn, undercut their prices. This runs counter to how the free market system is supposed to work, so the law does not allow this! If a nonprofit farm is using its volunteer base to get an upper hand at the market, the law may step in and say that the volunteers must be treated and paid as employees. What can the nonprofit farm do to prevent this? First, the nonprofit farm should be sure that the tasks assigned to volunteers are typical of volunteer tasks. Basically, they should be more tangential than essential to the farm’s core operations. While the volunteer base can offer a significant help to the nonprofit farm, the volunteers should not be running or even playing a critical role in the operation. In addition, the farm should be sure to charge the going market rate for its products.

6. Your nonprofit farm does not rely on the worker for essential duties

This factor goes hand-in-hand with the previous factor. The volunteer’s work should be informal. This means that if the volunteer doesn’t show up, the farm’s regular operations won’t be significantly affected. In other words, the volunteers should not be fulfilling essential duties of the organization that would otherwise be done by paid employees. One way the law gauges this factor is to see if regular employees are being displaced by volunteers. If they are, it’s looking more like an employee. To be on the safe side, the nonprofit farm should continually ask itself whether volunteers are displacing their employees. In addition, if the volunteer is being told to come in at a specific time for a specific duration on a specific day, the law will most likely see this as an employee. Farmers should extend flexibility and forgiveness to volunteers and not become overly dependent on them.

Now What?

Farms that do meet the volunteer criteria

Farmers like Farmer Ralph who have a non-profit farm and feel they meet these criteria should review Section 2, Managing Risks of Interns and Volunteers in Vermont for more information on the legal aspects of hosting volunteers.

Farms that don’t meet the volunteer criteria

Farmers like Amanda will most likely need to treat their workers as employees. First, however, they can review the criteria in the next two sections for independent contractors and interns to see if they might qualify.

Independent contractors

Legal Definition

What is an independent contractor? The law defines an independent contractor as someone who performs a specific service for another while having control over precisely how the work is done.

Does your farm meet the six criteria for an independent contractor?

Farmers may be asking, what are the benefits of classifying workers as independent contractors? The main benefit in Vermont is that the farm is not required to pay minimum wage, carry workers’ compensation, or pay payroll taxes for independent contractors—whereas the farm may have to for employees (depending on available exemptions). When farm budgets are tight, the flexibility that independent contractors allow can seem attractive. However, if the farm misclassifies a worker as an independent contractor, it potentially faces penalties and fines at both the state and federal level.

The Vermont Department of Labor (VT DOL) uses the ABC test to determine whether a worker is an independent contractor versus an employee. The ABC is not an acronym, but rather signifies a three-part test. All three criteria must be met for the worker to be considered an independent contractor. Vermont’s ABC test is more stringent than the test used by the US Department of Labor (US DOL). Farmers must be particularly cautious that they are following Vermont’s legal criteria for independent contractors if they choose to have independent contractors.

Before getting into the details of the legal criteria, it’s helpful to start with a “perfect” example of an independent contractor—a plumber. The plumber comes to your house, brings her own tools, and her skills and expertise to determine what needs to be done to reach your goal of fixing your pipes. She doesn’t take orders from you. Also, she likely has other clients, and has business skills to build her plumbing business. You hire her for a specific project, and while you may call her back when things break, you don’t have a permanent or ongoing relationship. This is a true independent contractor. With this in mind, let’s turn to the criteria.

A: The worker is free from any control and direction over how the work gets done

Under this criteria, the worker is an individual contractor if she completes the work with no direction, supervision, or set hours. The worker is more likely an independent contractor if the farmer provides little to no instruction for how the task gets done and simply cares about the end result. That’s because the law assumes that independent contractors are already skilled at the services they provide. They know best how to do the work. If the farmer trains or instructs the worker on the specifics for how to pull weeds or how to transplant tomatoes, it’s likely an employee. In addition, the independent contractor typically sets their own schedule. So if the farmer is telling her workers exactly when to arrive and how long they must work out in the field, they’re likely employees. However, the farmer can set a deadline or a time when the project needs to be completed. Independent contractors can choose to hire and pay assistants if that’s what it takes to get the job done on time. If any assistants are hired, these folks must be supervised by the independent contractor and not the farmer.

Also, independent contractors are typically paid for the services they provide. They often bid out the project and their pay is typically not based on an hourly, weekly, or monthly rate.

B: The worker does not perform tasks or services that are core to the farm business

Independent contractors must conduct tangential tasks and not the core or day- to-day tasks of the farm operation. One way the VDOL measures this is to assess whether the worker performs tasks that other employees perform. For example, core tasks like harvesting crops on a daily basis would not be appropriate for an independent contractor. These tasks are essential and get to the core of the farm operation; they are typically completed by employees. However, a farmer may hire an independent contractor to install or fix the irrigation system or build an equipment shed, as these are more one-off projects.

In addition, if the worker performs the service at her own facility it often looks more like an independent contractor. For example, the farm may decide to outsource its accounting to an independent contractor who does the work from her own office.

C: The worker must be in business for herself

An independent contractor is generally someone who demonstrates business skill and initiative. Like the plumber, she’s building her client base to run an independent business. The independent contractor typically has her own specialized tools and equipment rather than using the farm’s tools and equipment. She may also have her own employees, which she manages. The independent contractor will also have her own unemployment insurance account with VDOL.

In addition, an independent contractor typically has a number of clients and doesn’t work solely for one farm. Independent contractors conduct their own advertising to promote their services. After all, they’re operating a business and to be successful they need a broad client base. If the worker primarily works for the farm, or is essentially “full time,” it’s most likely an employee and not an independent contractor.

Now what?

Farms that do meet the independent contractor criteria

Independent contractors are not covered by employment laws such as workers’ compensation, minimum wage, and others.

Farms that do not meet the independent contractor criteria

So you don’t meet these criteria? This means you don’t have an independent contractor. You likely need to go back to the default classification of employee. First, there’s one more option: interns. Read the following section to confirm your status there. Or, assume you have an employee and skip to the last section.

Interns

Legal definition:

What is an intern? Unfortunately, the law does not provide a precise definition of an intern; however, the legal criteria for an intern emphasizes the educational dimension of the arrangement. In addition, the intern should be the sole beneficiary, or at least the primary beneficiary, of the internship program.

Does your farm meet the legal test for a non-employee intern?

These are tough questions, as the law surrounding non-employee interns is rather complex. Like Amanda and Ralph, farmers are attracted to offering “intern” positions because they want to offer a lot of education. However, farmers are often under the impression that because education is such a strong component, the intern is different than a regular employee. This is a misimpression. Simply providing education to a worker does not mean the worker is not an employee. Even if the farmer calls the worker an “intern,” the law will treat the worker as an employee unless they meet the legal test for interns.

In January 2018, the US Department of Labor (US DOL) updated its “legal test” for whether a worker qualifies as non-employee intern. The US DOL now applies the “primary beneficiary test” which matches the more flexible approach that several federal appellate courts have recently developed. The “primary beneficiary test” reflects the principle that to be a non-employee intern, the primary beneficiary of the internship program must be the intern, not the farmer. Under this test, the US DOL evaluates the following seven criteria to determine whether a worker is the “primary beneficiary” of the relationship and thus a non-employee intern:

1. The farmer and the intern both understand that the intern is not entitled to compensation.
2. The internship program provides training that would be given in an educational environment.
3. The intern receives academic credit upon completion of the internship program.
4. The internship program corresponds with the academic calendar.
5. The duration of the internship program is limited to the time when the intern receives the education or training provided.
6. The tasks the intern performs provide significant educational benefit and they complement rather than displace the tasks of paid employees
7. The intern and the farmer both understand that the intern is not entitled to a paid job when the internship program ends.

How does the farmer know if its internship program sufficiently meets these seven criteria of the US DOL’s “primary beneficiary test”? The reality is, there’s no absolute certainty. The primary beneficiary test is a flexible test. Not all seven criteria need to be met and no single criteria is determinative. Whether an intern is an employee depends on the unique circumstances of each situation.

What does this mean for farmers in Vermont? It means there’s a level of uncertainty, which carries risks. What are the risks here? If the farmer treats their workers as non-employee interns and the law determines otherwise, the farmer risks having to pay back wages, back taxes, penalties, and lawsuits.

With this in mind, farmers basically have two options. Farmers who are risk averse and want to play it safe should treat their interns like employees and follow all applicable employment laws. Farmers who are less risk averse can choose to follow the seven criteria in the US DOL’s “primary beneficiary test” the best they can. Farms that accommodate a worker’s formal academic commitments, such as offering the intern position in the summer when school’s not in session, providing structured training with set curricula and learning objectives, tying the internship to an academic institution, and offering a limited term position will have an easier time arguing that the intern is not an employee.

For more details on these criteria on interns, see Farm Commons’ resource Managing Risks of Interns and Volunteers in Vermont.

Now what?

Farms that do meet the legal criteria for interns:

The law surrounding interns is uncertain, and involves a level of risk. Farmers should read Section 2, Managing Risks of Interns and Volunteers in Vermont, for more information on working with interns and to learn ways to minimize risk.

Farms that do not meet the legal criteria for interns:

Farmers uncertain if they meet the non-employee intern criteria should read Section 2, Managing Risks of Interns and Volunteers in Vermont for more information. If these criteria are not met, the farm’s interns are legally classified as employees.

Employees

Legal Definition

What is an employee? Vermont law defines an employee as someone who an employer directs or permits to work for her for profit business.

Employee is the default category

Bottom line, if someone performs work for a for-profit business the assumption is that he or she is an employee. That is, unless that person can be classified as an independent contractor or a non-employee intern. Again, for-profit businesses generally cannot have volunteers, so that is not an option.

Now what?

What must farmers do when they have employees? They must follow all applicable state and federal employment laws. For an overview of these requirements, see Section 3, Basic Checklist for Hiring a Farm Employee in Vermont.