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LABOR DEBATE IN ALBANY: Lawmakers in Albany are considering whether New York farmers should have to pay overtime to their workers, but the economic effects could be enormous.

New York may join 4 states requiring farmworker overtime pay

Farm Credit East says net farm income could drop 28% because of increased labor costs.

New York state would become just the fifth state in the country to require mandatory overtime on farms if the Farmworker Fair Labor Practices Act passes.

But unlike other states that either have a higher weekly overtime threshold or are slowly phasing in the 40-hour requirement, New York state will be the strictest farm overtime state right off the bat.

Four other states — California, Hawaii, Maryland and Minnesota — all have laws on the books that require farmworkers be paid overtime, according to a March report by Farm Credit East.

California, the largest agricultural state in the country, requires farmworkers be paid overtime if they work more than 55 hours a week or more than 9.5 hours a day. But that is scheduled to change in 2022 when the threshold drops to 40 hours a week or 8 hours a day.

Hawaii requires farmworkers be paid overtime if they work more than 40 hours a week, but employers can select up to 20 weeks per year where the threshold is 48 hours per week; the idea being that employees can work longer hours during the busiest times.

Maryland is the only state in the East that requires overtime pay for farmworkers, but only after 60 hours per week. Colby Ferguson, director of government relations for Maryland Farm Bureau, says the law has been on the books for more than 25 years. Employees get paid time-and-a-half once they go over 60 hours, he says.

Minnesota also allows overtime, but only after 48 hours a week.

Costly to farmers

The Farm Credit East report states that the Farmworker Fair Labor Practices Act would increase labor costs in the state by 17.2% if farmers had to pay overtime. Combine that with the rise in minimum wage — $12.50 by 2021 for upstate New York and $15 for New York City and Long Island — and labor costs will rise by $299 million a year. The report estimates it could reduce net farm income by 28%.

Tom Cosgrove, vice president of Farm Credit East’s Knowledge Exchange, which produced the report, says that other things such as payroll taxes and worker’s compensation will go up as wages rise. The report states that only 28% of farms have hired labor, but they generate 80% of the state’s gross farm income.

Cosgrove says the proposed law could put New York farmers at a competitive disadvantage to other states, and Ontario and Quebec, Canada, since overtime pay for farmworkers is not required in those places.

He says most farmers won’t be able to pass the extra cost down to consumers, which will likely result in farmers cutting back on production and cutting hours or shifting to less labor-intensive farming.

Some farmers could tap the federal H-2A program for seasonal work, but that won’t help dairy farmers since H-2A doesn’t have a year-round component.

Bruce Krupke, executive vice president of Northeast Dairy Foods Association, which opposes the bill, says he fears the legislation will pass as written with no amendments. He testified at a recent hearing on the bill at SUNY-Morrisville State College, where he estimates more than 70% of attendees opposed it.

Given the fact that the bill is gaining support in both houses of the Legislature and is supported by Gov. Andrew Cuomo, he says agriculture should be doing more to ask for compromises, including asking for a later phase-in or a lesser overtime rate than time-and-a-half.

Steve Ammerman, spokesman for New York Farm Bureau, says that a proposed bill by Sen. Diane J. Savino, D-Staten Island, would only require overtime pay if a farmworker works more than 10 hours a day or 60 hours a week. It also requires farmworkers get at least one rest day per week. The proposed legislation is currently being considered by the Senate Labor Committee, but the chairwoman of the committee, Sen. Jessica Ramos, D-Jackson Heights, is focused on passing her more stringent farmworker labor bill, he says.

“I could envision 500-plus farmers and their families, maybe some tractors, marching on the Capitol in Albany,” he says. “I just don’t believe the legislators outside of New York City have received the message from their rural constituents.”

Worries in California

California is one of the only states that allows farmworkers to be paid overtime and to organize. In 2016, the state was the first to pass a law requiring farmworkers be paid overtime if they work more than eight hours a day.

The first phase-in of that law began in January, according to Capital Public Radio, with farmworkers getting overtime after 9.5 hours a day or 55 hours a week. Right now, the law applies to farm businesses with more than 26 employees, but it will cover every farm by 2022 when the overtime threshold becomes 8 hours a day, 40 hours per week.

Craig Regelbrugge, senior vice president of advocacy and research for AmericanHort, a Columbus, Ohio-based advocacy group for the nation’s horticulture industry, says labor challenges in California are serious and getting worse, with the overtime changes adding more stress.

He says growers are struggling to pass along the cost of overtime and, as a result, are limiting hours

“The workers, by and large, would rather work the hours, so they end up in a better place,” he writes in an email, adding that labor costs will lead to more mechanization, which will be expensive and time-consuming. “But you can pretty much rest assured that the larger growers will be best-positioned to embrace new technologies, and the smaller- and medium-sized family farms and businesses will suffer most.”

Regelbrugge says many farmworkers are distrustful of unions and that many don’t bring meaningful benefit to workers.

“This is a personal opinion, but I think that if union are to have a future in this space, they need to innovate to offer benefits that actually bring value into the equation. That’s not easy,” he writes.

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