How do we fix wages in the wine industry?

I have compiled all four parts of the wages series I worked on over the last few months; having interviewed winery workers, owners and consultants that resulted in varying perspectives on the approaches we can employ to incite reform.

Part I

A question that continues to plague the wine industry: why are we still fighting for fair wages? Dependence on foreign work has emerged as a response to the problem, yet the myriad causes of the disparity are generally glazed over or misunderstood.

Controversies are bubbling to the surface more than ever: the sordid affairs of Valentina Passalacqua, a Puglian winemaker facing accusations of complicit involvement in her father’s crime of “caporalato” (exploiting foreign labour via barely passable living quarters and substandard working conditions), or horror stories of agricultural workers sleeping behind Walmarts in California, attempting to subsist on wages of a few dollars per hour.

It seems a bit foolish in contrast to be hyper focused on sulfur levels or yeast strains, while rarely paying homage to the workers playing a crucial role in the production of bottles being imbibed in the first place.

A divergence of wage growth and inflation, taxes, low margins, cost of land, and most recently, the option of collecting CERB – all contribute to the labour issue affecting the wine industry today.

“What we’re looking for is domestic equivalency – I only collect 42 cents on the dollar for my wine. The most distressful time in our industry – with true existential threats – is when our government needs to come to terms with the fact if they don’t support our industry, there won’t be one.” shares Dan Sullivan, proprietor of Rosehall Run in Prince Edward County.

Sullivan has emerged as a leader in the wine industry, advocating for fair treatment of workers, and emerging as a whistle blower on the unfair tax structures impacting small winery owners.

“We pay some of the highest wages in the world in Ontario. This is not a unique problem to Canada. Most of the crews in France come from north Africa. Italy is the same story. I don’t think we’re going to be moving away from offshore labour any time soon, and I’m not sure that’s really a problem. I also don’t think Canadians are prepared to pay an extra 4-5 dollars more per bottle. If you’re any business in Ontario, you’re subject to 13% HST, all the other various employer taxes that you pay along the line, and then you’re done. In the wine industry, there’s HST and employer taxes, but on top of that you’re paying 6.1% at farmgate and this is collected by the provincial government through the LCBO. The only justification for it is that we’re in the wine business. You’re taking wholly domestic agricultural operations and you’re saddling them with a tax which makes them less competitive to foreign companies that don’t have that in their market. On top of that, there’s an environmental fee, bottle fee, VQA fee - all of these things nibble away at the profitability.”

Arbitrary taxes and fees can mean the difference between a meager profit or breaking even for small, family owned wineries – the bulk of which make up the Canadian wine industry. When it’s a cause of wage disparity– it necessitates petitions advocating to save rural jobs, in hopes of equitable pay and engaging more locals to do the work.

Colleen Ingram, a vineyard manager in the Okanagan Valley, is working with foreign labour for the first time this season. The response to the migrant workers has been disappointing, with issues of prejudice and judgment from locals, ironic considering they’re people who don’t want to do the work anyway: “It’s very upsetting reading the mainstream media – people don’t understand how valuable the foreign workers are. They make my job far easier especially when the locals don’t want to do it. For them, it’s a wage to get you through school. It’s not meant to be a wage to pay for a house and two kids. Unfortunately, in agriculture, a lot of what you see listed is minimum wage.”

On average, $16-18/hour is the norm for agricultural labour, working out to roughly $33,000/annually. While financially attractive to foreign workers, they’re required to leave their families for upwards of 32 weeks. Conversely, Canadians accepting a similar wage are living just above the poverty line.

“We offered jobs to 60 locals while waiting for foreign workers. 16 showed up the first day, 6 showed up the 2nd day and 2 showed up the third day. There’s a mentality of ‘I’m not going to show up and break my back for $16/hour, I’d rather just go home and collect CERB for a little bit less.’ It’s been weird – we’re voicing that we can’t find labour. We’re willing to pay $17-18/hour, but existing labour requires raises that impact our bottom line and the end bottle and how much it costs. If we’re pricing ourselves out of the market by paying people more – we need to find the balance somewhere.”, laments Brett Thiessen, vineyard manager of Mount Boucherie Estate Winery and Rust Wine Co in the Okanagan Valley.

Additionally, with increased choice in jobs from retail to food delivery – most locals are opting for less physically intensive work, with the added bonus of collecting CERB concurrently. With the long hours required in agricultural work, it’s uncommon to find eager and willing workers among the local contingent.

Other wineries are brainstorming new solutions through partnerships with first generation Canadians, as Lee Baker, winemaker of Redtail Vineyards attests, “Do we look at increasing the amount of locals we use? Or do we try to appeal to first generation Canadians by providing them with affordable homes and supporting their entire families? Do we provide them with a scholarship for the children if they come work for us? We might have to think outside the box. COVID was a big stress test on our economy and if anything, it made necessary changes glaring. We saw that our entire industry and food supply chain was at risk because we’re so reliant on migrant workers. We were lucky they opened the borders, but they didn’t have to. At times, I thought it was silly to do so. The number one spread of COVID was international travel. It seems silly as we were laying off 2 million people within Canada.”

The wage and migrant worker conversation is a global one. Without government intervention and assistance, the future of the Canadian wine industry will remain uncertain.

Part II

*names have been changed

Luke has completed harvests all over the world, including France, New Zealand and most recently, Canada. The pull to come home inspired the move, and with an impressive resume under his belt, Luke excitedly made the trek back for an enticing role with a start-up winery.

To date, his position remains undefined. Luke is responsible for managing the vineyards and making the wine, yet his name does not appear on the labels. Luke shares, "I know I’m part of the problem. I get paid 50 grand a year and I work 60-80 hour weeks and weekends. I’ll be away on vacation and be asked to drive back to work and I won’t fight it. Too many of us have become normalized to this lifestyle. We’ve created an industry standard that we make fun of. The guy who works the most is some kind of hero. It’s really ugly and backwards. My parents freak out when I tell them how I’m treated. It’s a ‘whose dick is bigger than whose’ by hours worked – it’s not ok.”

When Luke approached the proprietors for a raise, he was met with an immediate no, under the guise of limited resources, despite employing an expensive consultant who advises on stylistic direction behind the scenes, unbeknownst to the consumer. Luke continues, “I made more money as a cellar worker than I’m making right now. If you want to eventually look for jobs, you can’t mess up. So now you are trapped. If I want good wine and I need to get cluster thinning or racking done, all of a sudden I’m in the winery 7 days, 70 hours a week on a 50k/year salary which is below $14/hour.”

It’s a vicious cycle of his own making. “What do you do? There are no jobs that are available especially right now. If I want to get paid more, I need to go to a bigger winery. Who is going to take the hit? Lower profit margins? Does the consumer need to pay more? Does the government need to back off on taxing us? What’s the route that we have to go? Our wine prices are already too high in Canada.”

This same sentiment carries through to various realms of the industry, particularly farming. Courtney works as a vineyard manager, garnering numerable years under her belt looking after various sites, coupled with the task of hiring and managing labour, many of which are migrant workers. She muses, “I’m making $40,000 a year managing 15 sites. I know of wineries owned by rich people who pay minimum wage and expect the world. It’s insane to me, but also why turnover is so high at so many wineries. You won't ever have staff work hard for you if you don't respect them.”

Issues that plague the industry are commonly known among wine industry professionals – high turnover, seasonality, and dependence on tourism – widely accepted as the nature of working in wine. It’s a challenging business in a healthy economy, let alone during a pandemic. COVID has required even higher than normal output, in an effort to slow down the bleeding, with sales plummeting on average 40-60% for small, privately owned wineries.

Cost of living complicates the issue further, with boarding rarely provided by wineries to seasonal or migrant workers, as Luke highlights, “In Canada, cost of living is the highest around the world. In France, I was paid 400 euros a month and provided boarding. And I was comfortable. I ate out a lot. I drank a lot. And I was fine. In Europe, they feel bad for Canadians. It’s Toronto rent in the middle of nowhere. Your cost of living here is absurd. They’re not farming regions, they’re rich people playgrounds. A lot of the wine regions start far less developed and don’t attract money. The rich people were here before the grapes were in Canada.”

Courtney echoes this observation - the negotiation of her wage dangled cheap rent as a tactic, “We were offered lower rent in exchange for less salary. When we eventually had to move, I asked if my wage would be reconciled if I was not getting cheap rent anymore and was never given an answer.”

The matter is further compounded with a steady influx of new graduates willing to do back breaking work for meager pay, thrusting the average income to pathetically low standards, as Megan, a head winemaker highlights, “Most people in wine – especially young people – get minimum wage. It’s ridiculous. Some cellar hands are working in the same spot for 8 years and see one raise in that time. I’ve worked at wineries that expect you to work 16 hour days, 6 days a week. The problem is there is so much work to do. There’s not a lot of labour out there. As a winemaker, trying to find temporary help over harvest is really difficult.”

Even more alarming is the lack of security or benefits provided to workers, often without healthcare coverage of their own, all the while performing duties in conditions that aren’t always safe, as Krissy, a cellar hand, points out, “On a number of occasions, I’ve almost lost my fingers setting up equipment on the crush pad. Why are health insurance and benefits for cellar hands not mandatory? We put out so much effort in a season making money for these companies, getting paid the same amount as someone flipping burgers at a McDonald’s.”

Carrie, a cellar hand, attests to the contradiction of high expectations and pitiful working conditions, “Wages and salaries are bad, especially for the hours and level of commitment involved (especially during harvest). I wasn’t paid overtime during harvest, but rather what would’ve worked out to my hourly wage. I was never offered commission or bonuses for sales made to restaurants and in one winery’s case, had a limit on the amount of sales related expenses that they’d reimburse me for.”

An assertion that attempts to justify low wages are the margins, similar to those of hospitality. However, many refute this cop-out exposing archaic hierarchies, unequal opportunity and a revolving door – resulting in perpetual training of new staff. Most wineries include training as a necessary expenditure in their annual budgets, one that could be re-evaluated with more progressive and equitable policies, resulting in higher retention and culture among their hires.

Lisa, a lab tech with nearly 10 years experience, agrees with poignant observation, “The wine industry is built on the backs of young, over educated people who are often exploited and subjected to poor working conditions which lead to injury and frequent mental health issues. The pay for most is hardly passable for a living wage with most cellar hands starting at $15/hr further forcing staff to work 16-18 hour shifts to cover their expenses. The industry is built on burnout culture that functions as a way to endorse the gentleman’s club that it truly is. It is disheartening that winemakers are making so much more annually than I do with a $20/hour salary even though my job requires a post secondary degree and nearly 7 years of experience. The worst still, is I am making what would be considered a good wage in the industry compared to others in a similar position.”

Some of the industry eventually transition to larger estates, with the hope of a regular schedule, paid vacation, and benefits, as Luke confides, “There are weird things within the industry once you jump over to the bigger estates – you’re expected to sell your soul, though. There’s this choice you need to make – do I want a life or do I want to make commercial wine? Most owners – they don’t pay themselves. Even if they do hire someone – the most they’ll pay is $16/hour. Even then it’s never consistent. That really only happens in bigger sites. It’s a really ugly cycle in Canada.”

Alternatively, many opt to leave Canada entirely, seeking out more reasonable conditions that supply boarding, vehicles and living wages, as Megan points out “In Australia, it’s very easy to find these types of positions. When I was working there, I hired for harvest and got tons of travelers. It’s not the case here, because we don’t offer the benefits. A lot of places will offer minimum wage but require you to manage your own housing and transportation. You’d have to have money saved before you came here – you wouldn’t make enough as a temporary harvest worker from overseas to come over, get a one bedroom apartment and buy a vehicle just to go to work and back for two months at $16/hour.”

Megan continues, “The reality is – these businesses cannot afford to pay more. The wine industry is treated differently than any other business. We’re expecting a professional work force to come through, but how do you afford all that? The margins are not big. Everything is very narrow. It’s tough because a lot of places can’t afford to pay people properly – they’re trapped. There are big wineries that make a lot of money but they still pay people low wages.”

A defeatist veil blankets the industry, but as Luke shares, until we shift our mentality and empower more of the industry to whistle blow on its current conditions, we will not experience noticeable change, “It just cycles back. Us trapping ourselves into thinking what we do is normal. You need to change the culture before you change the numbers.”

Part III

Lauren Buksevics is the daughter of John Skinner, founder and owner of Painted Rock in Penticton, BC. Painted Rock is widely heralded within the Canadian industry, largely due to their tireless championing of the BC wine industry in international markets.

There's a palpable sense of pride that emanates from Lauren, evidenced through her confident voice. What's clear, however, is that despite outward appearances, the building of their brand has been a decades long battle, "We bought the property in 2004. My Dad had a previous career but wanted to build a family legacy. If you think of concept to cash flow - he invested in 2004, sourced and planted vinifera, paid consultants - it was 5 years of pure outflow. We didn't sell any wine until 2009. It wasn't until 10 years after we bought the land that my Dad started taking a salary."

Jak Meyer, founder and owner of Meyer Family Vineyards in Okanagan Falls, BC, who produces some of the region's best Chardonnay and Pinot Noir, echoes Lauren's statements, "The path to profitability is long and full of challenges. The path to cash flow positive is even more so. Anyone with a winery has put in years and years of cash, hard work and risk in order to make wine and at the end of the day there is very little guarantee of success. This is still farming and over the long run, land prices continue to move up so generally speaking, most people are cash poor and asset rich."

While they're often accused of the "rich owner" trope, Lauren shows no qualms clapping back, instead opting to mention how well they treat their employees, "Our winemaker started with us as a cellar hand and worked his way up. We paid for his education in Washington. On the flip side, we've had vineyard staff who we sent to school and as soon as he graduated, he moved to another winery. We will always invest, pay well, give benefits to salaried employees and give salaries as much as we can to give security but there's both sides to the story that need to be shared."

It's a widely held misnomer that proprietors have deep pockets. Lauren debunks this myth, by exposing a skewed reality: voices of scorned or disgruntled staff often take precedence to ownership woes, "We had a manager quit when I was 9 months pregnant on Christmas eve because she had just received her Christmas bonus. I was about to have a baby and I couldn't even fly to the winery because I was too pregnant. Of course there's cases where managers are underpaid and under valued but there's also examples of employees who don't treat employers with that much respect either."

Jak espouses this statement, sharing that cash flow was challenging for his winery in the first decade of its inception, "We put in a large chunk of money in the beginning and had to supplement cash flow for approximately 7 years and only after that started to repay that shareholder loan. We are 14 years into it now and still have an existing shareholder loan we are repaying as we are now profitable. We have been fortunate that land prices have risen significantly so there is a pot at the end of the rainbow however this is only accessible if selling."