In determining whether a practice performed on agricultural or
horticultural commodities is incident to or in conjunction with the
farming operations of a farmer or a farm, it is also necessary to
consider the type of product resulting from the practice--as whether the
raw or natural state of the commodity has been changed. Such a change
may be a strong indication that the practice is not within the scope of
agriculture (Mitchell v. Budd, 350 U.S. 473); the view was expressed in
the legislative debates on the Act that it marks the dividing line
between processing as an agricultural function and processing as a
manufacturing operation (Maneja v. Waialua, 349 U.S. 254, citing 81
Cong. Rec. 7659-7660, 7877-7879). Consideration should also be given to
the value added to the product as a result of the practice and whether a
sales organization is maintained for the disposal of the product.
Seasonality of the operations involved in the practice would not be very
helpful as a test to distinguish between operations incident to
agriculture and operations of commercial or industrial processors who
handle a similar volume of the same seasonal crop. But the length of the
period during which the practice is performed might cast some light on
whether the operations are conducted as a part of agriculture or as a
separate undertaking when considered together with the amount of
investment, payroll, and other factors. In some cases, the fact that
products resulting from the practice are sold under the producer's own
label rather than under that of the purchaser may furnish an indication
that the practice
is conducted as a separate business activity rather than as a part of
agriculture.
