Labor & Employment Law Daily Wrap Up, WAGE-HOUR—6th Cir.: Punitive damages award for H-2A visa violations upheld on appeal, (Aug 31, 2026)

By Ronald Miller, J.D.

Although the lack of non-economic damages cut in favor of the defendants on this guidepost, the Sixth Circuit has never conditioned punitive damages on juries awarding non-economic damages.

A jury’s award of punitive damages in favor of H-2A agricultural workers recruited from Guatemala was upheld on appeal to the Sixth Circuit. The workers alleged illegal conduct, including the defendants charging them illegal recruitment fees, subjecting them to squalid living conditions, underpaying them, restricting their freedom, and threatening to deport them if they alerted anyone of their plight. The jury awarded the plaintiffs compensatory and punitive damages but not non-economic damages. Because the jury awarded the plaintiffs economic compensatory damages only, the defendants contended that the jury lacked any basis to award punitive damages. However, the appeals court held that the award of punitive damages comported with due process. The defendants’ conduct was reprehensible; the ratio of compensatory to punitive damages was modest and well within constitutionally permissible limits; and the defendants received fair notice that their conduct might result in penalties, fines, or punitive damages in the amount awarded here (Gomez-Excheverria v. Purpose Point Harvesting, LLC, No. 25-2080 (6th Cir. Aug. 28, 2026)).

H-2A visa program. Under the H-2A visa program, employers may hire foreign nationals for seasonal agricultural jobs. The U.S. Department of Labor closely regulates the H-2A program and imposes strict requirements on employers. Employers are prohibited from charging potential H-2A workers recruitment fees as a condition of their employment. Employers must also file a Form ETA-790, which operates as a legal contract between the H-2A worker and the employer. As part of this contract, the employer agrees to provide certain benefits meant to support the H-2A worker while he or she is employed in the United States.

The defendants in this case relied on the H-2A program to employ seasonal farm workers, whom they then contracted out to third-party farms. The plaintiffs are Guatemalans who entered into H-2A contracts with the defendants for the 2017, 2018, and 2019 growing seasons. Under their contracts, the defendants were to provide adequate housing, workers’ compensation insurance, any required tools, supplies, or equipment, meals, and transportation and would pay the higher of either minimum wage or prevailing wages, which can include piece-rate wages.

Breach of H-2A contracts. According to the plaintiffs, the defendants breached the agreement and violated the law in several respects. The defendants charged an illegal recruitment fee of $2,500 each year they worked. The defendants also failed to compensate the plaintiffs as they agreed. And the defendants destroyed records tracking daily hours and piece-rate production for the 2017 and 2018 harvest seasons, stymieing any challenge by the plaintiffs.

Further, the plaintiffs alleged that the defendants forced them to live in squalid conditions, in small trailers, often sleeping on couches rather than in beds. In contravention of their contracts, the plaintiffs also had to purchase their own equipment. The defendants required the plaintiffs to buy their food at a store owned by a defendant’s father and failed to provide or delayed providing medical care.

The defendants also limited the plaintiffs’ freedom. The defendants regularly confiscated the plaintiffs’ personal documents, including their passports and social security cards that were issued under the H-2A program. Moreover, when the plaintiffs opened accounts at a local bank, a defendant, without the plaintiffs’ knowledge, set herself as an authorized user, giving her direct access to these accounts. Another defendant threatened the plaintiffs to keep them quiet about their treatment.

Lawsuit. The plaintiffs sued the defendants under the Trafficking Victims Protection Reauthorization Act (TVPRA); the FLSA; the Michigan Workforce Opportunity Wage Act (MWOWA); the Michigan Human Trafficking Victims Compensation Act (MHTVCA); and state contract law.

The defendants asserted counterclaims for breach of contract, among others. They also contested the plaintiffs’ version of events. A jury found the defendants liable on every count, except for the MHTVCA claim, and rejected the defendants’ counterclaim. The district court entered judgment in favor of the plaintiffs, awarding $105,000 in compensatory damages, plus prejudgment interest, $450,000 in punitive damages, as well as $803,352 in attorneys’ fees and $101,281 in costs. The defendants appealed.

Punitive damages. The defendants first argued that the jury’s award of punitive damages violates due process. The Sixth Circuit considered three “guideposts” when evaluating whether a punitive damages award offends due process: (1) the degree of reprehensibility of defendants’ conduct; (2) the punitive award’s ratio to the compensatory award; and (3) sanctions for comparable misconduct.

Here, the jury awarded the plaintiffs economic compensatory damages only. According to the defendants, the jury made an “express factual finding that no compensable psychological, dignitary, or emotional harm occurred.” Thus, they contended that the jury lacked any basis to award punitive damages.

Reprehensibility. Although the lack of non-economic damages cut in favor of the defendants on this guidepost, the Sixth Circuit has never conditioned punitive damages on juries awarding non-economic damages. Instead, the court has merely emphasized that there must be sufficient evidence of reprehensibility for an award of punitive damages to comport with due process.

First, a TVPRA claim inherently carries with it a degree of reprehensibility. The jury had to conclude, at a minimum, that the defendants recklessly disregarded that they were benefiting from a venture that obtained labor by a pattern intended to cause the plaintiffs to believe they would suffer some physical or legal harm. This is reprehensible conduct. And a pattern means that the defendants’ “conduct involved repeated action,” not “an isolated incident.”

Second, the jury heard evidence that the defendants charged illegal recruitment fees, restricted the plaintiffs’ movement, destroyed records, confiscated passports, limited visitors, and repeatedly threatened the plaintiffs with deportation and other consequences if they spoke out about their mistreatment. The jury also heard evidence of the plaintiffs’ squalid living conditions and the defendants’ refusal to provide adequate medical care. All this supported the jury’s conclusion that the defendants’ conduct was intentional and egregious.

Moreover, the plaintiffs were undeniably vulnerable victims who feared reprisal and the loss of the opportunity to work in the United States. The jury heard ample evidence to warrant condemning the defendants for their reprehensible conduct, so this guidepost supported upholding the punitive damages award.

Ratio to actual harm. Next, the court looked to the “punitive damages award [and] its ratio to the actual harm inflicted on the plaintiff.” The defendants argued that the ratio here crossed the constitutional line. They contended that because each plaintiff’s compensatory award is high, the amount of punitive damages for each plaintiff should be closer to a 1:1 ratio and there must be more evidence of egregious conduct than that present here to support a higher ratio.

The appeals court disagreed with, finding that the average ratio of 1:4.3 for the total amount of compensatory damages compared to the total amount of punitive damages—$105,000 to $450,000—was rather modest. Further, the individual ratio for each plaintiff was in the single digits, and “[s]ingle-digit multipliers are more likely to comport with due process.” Because the ratio of compensatory to punitive damages was modest and well within constitutionally permissible limits, this guidepost also supported upholding the punitive damages award.

Fair notice. Finally, the court asked “whether the [defendant] had fair notice that conduct of the sort that occurred here might result in penalties, fines, or punitive damages” comparable to the amount awarded by the jury.

Department of Labor regulations impose potential civil penalties for violations of the H-2A program. Repeated failures by defendants to pay plaintiffs proper wages and provide adequate housing, among other things, could have incurred substantial penalties dwarfing the $450,000 punitive damages award here. Further, a finding of liability under the TVPRA imposes criminal penalties up to 20 years in prison, and a $250,000 fine for individuals and a $500,000 fine for organizations.

These provisions provided the defendants with fair notice. The fact that the total punitive damages award was substantially less than the potential criminal penalties for defendants under the TVPRA placed the defendants on “fair notice that conduct of the sort that occurred here might result in penalties, fines, or punitive damages” in the amount awarded here.

Accordingly, the appeals court held that the award of punitive damages comported with due process.

The case is No. 25-2080.

Judge: Griffin, R.

Attorneys: Robert Anthony Alvarez (Avanti Law Group) for Purpose Point Harvesting, LLC. Jessica Mugler (Boies, Schiller & Flexner) for Luis Gomez-Excheverria, Hervil Gomez-Echeverria, Darwin Joel Fuentes Perez, Artemio Coronado Esteban, and Leonel Lopez y Lopez.

Companies: Purpose Point Harvesting, LLC

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