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Postville property owner: Wage deductions were done to help newcomers
“We were trying to help people who were coming into the community without money and without a way to pay rental deposits and first month rent,” said Gabay Menachem, owner of GAL Investments, Inc., in a telephone interview Monday. “We worked with these people individually to allow them to use their future wages at Agriprocessors as security that they would pay their obligations.”
Menachem said the wage agreements, which began three to four weeks following the massive May immigration raid at the meatpacking plant, were viewed as a way to ensure he would get paid and to allow the new workers to immediately have a roof over their heads despite their inability to pay up front. The employees signed written contracts with GAL to have an agreed upon amount taken from their future paychecks, which were being paid by Jacobson Staffing Co. While there was a verbal agreement on behalf of GAL and Jacobson to offer this process to the new workers, residing in GAL properties was not a condition of employment, nor was there a written contract between the staffing and property company.
“When the new workers first came into town, I did rent to some without a wage agreement,” he said. “If the worker did not last, I was often left holding the bag. Even after we began to do the wage agreements with Jacobson, if a worker didn’t stay as an employee, I often would not know right away and would be left with a shortfall.”
Menachem believes the intent of the agreement was noble, but is concerned that media may have provided a false impression of his role in the wage agreements and with the Agriprocessors kosher meatpacking plant.
“I have set rents on my properties,” he said. “The properties were rented by unit and not by person in a unit. There may have been some of our renters who went against the rules and sub-leased their properties to others, but we did not have a part in that. I think there is a belief or a perception that I’ve exploited the workers and am getting rich from the wage agreements. That is just not the case.”
Tomorrow GAL will cease all wage agreements with the employees that were hired by Jacobson. Tenants working for Jacobson will no longer have their rental payments deducted from their paychecks, but will pay those bills directly to GAL. While Menachem acknowledges that this is an indication that workers who initially needed help in order to begin their new journey as members of the Postville community have become more self-sufficient, he also knows the decision could make moving to Postville difficult for future new residents.
“Before, Jacobson workers were able to use their employment as security for their rent and deposits,” he said. “This will no longer be the case and new workers will now have to pay those costs up front.
“It was an usual system to begin with,” he added. “I can’t think of any other place in America where a person could come into town with nothing and soon have a place to live and new employment. It typically just doesn’t work that way. People have to pay for those things up front. But because the plant needed the workers and because Postville needs the plant, we were willing to try and help people coming into town.”
Nina Taylor, who runs an accounting business and does work for GAL, said she remembers what Postville looked like before Agriprocessors purchased the defunct meatpacking plant.
“It was a ghost town,” she said. “There were many properties in town that were either for rent or for sale with few prospects for renters or buyers.”
As for the condition of rental properties being managed by GAL, Menachem, who has been a member of the Postville community for roughly four years, said the properties were in extreme disrepair when he originally purchased them.
“I’ve bought the properties, which were in need of assistance, and would work on them,” he said. “We’ve chosen to take care of the indoor problems first, so there are some of the properties that still look neglected on the outside. But, we are still working to repair that as well. You can see a big difference in the properties that we’ve owned for some time and those we’ve recently acquired.”
Taylor added that the problem with property maintenance bubbled over immediately following the immigration raid.
“Something that I haven’t seen reported is that many of the properties were rented before the raid to individuals who were not in the country legally,” she said. “People in that circumstance didn’t like to draw attention to themselves and, because of that, often didn’t report problems within their rental units. There was also a period of time right after the raid when we didn’t know which tenants had been detained or which properties were available.”
In the first weeks following the raid, GAL scrambled to find out which properties were vacant. According to Menachem, before the properties could be properly inspected and/or cleaned, there were new workers in need of a place to live.
“Before the raid I had two fulltime maintenance people on staff,” Menachem said. “All of this time since the raid, I’ve employed seven maintenance workers, and they all have been kept very busy correcting problems that have come to our attention.”
Although workers through Jacobson will no longer have rents deducted from their paychecks, employees that enter the plant via One Force Staffing will still have the option of living in properties that have been rented from GAL by the staffing agency for a wage deduction of $100 per week. Menachem wants the public to know that the properties have been rented at his standard rate and that GAL has no interest in the wage deductions being done by One Force.
Getzel Rubashkin, a grandson of Agriprocessors founder Aaron Rubashkin, is concerned that Iowa Independent’s previous report regarding the agreement between GAL and Jacobson may have mischaracterized him as a family or company spokesman.
“I can speak only for myself, and definitely am not speaking on behalf of Agri or for the family,” he said in a telephone conversation Monday morning. “In addition, I am concerned that my remarks were taken out of context and may have been interpreted to mean that this was how the company was justifying the payroll deductions.”
Formal requests for interviews of members of the Rubashkin family have been ignored, although prepared statements from company and family spokespersons have been made available to Iowa Independent via e-mail. With the lack of another avenue to present an opposing viewpoint and believing readers would want to know that the payroll deductions were used to pay more than rent, Getzel Rubashkin’s comments from the Failed Messiah blog were used in our report.