The USDA finalized a rule to reform the poultry “tournament system,” aiming to improve fairness for contract growers in the ag industry.
The rule, part of the Packers and Stockyards Act, prevents poultry integrators from docking growers’ base pay under the tournament system, though bonuses are allowed. It also caps variability in performance payments at 25% of annual gross pay and mandates transparency in contracts.
The poultry tournament system is a performance based payment system that compares poultry growers against each other to determine how much they are paid. It’s also known as an incentive-based arrangement.
Critics have voiced their opinions, like the National Chicken Council, arguing the rule could stifle innovation and increase costs on producers, while supporters see it as a step toward protecting growers from exploitative practices and gaining fair treatment.
This rule builds on prior USDA actions, including the 2023 “Transparency in Poultry Grower Contracting and Tournaments” rule, which required detailed payment and capital demand disclosures.
Photo Credit: USDA
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