A bill that requires agricultural employers to pay their workers overtime takes effect Jan. 1, and some farmers already are trying to find ways around it.
“We told our guys they’re not going to get overtime,” said Anne Krahmer-Steinkamp, a blueberry farmer in Albany.
It’s not that she doesn’t think her workers don’t deserve fair pay, she said. But she and other farmers say they will not be able to afford to pay 150% of their hourly rates.
Farmers have warned that instead, they will cut hours or mechanize some of their processes, resulting in fewer hours and lower wages for farmworkers.
The policy will be phased in over five years. For the first two, starting in 2023, farm operators will be required to pay workers time-and-a-half for any hours worked past 55 in a week. Starting in 2025, that threshold will drop to 48 hours a week for another two years. By 2027, farmers will have to pay time-and-a-half for any hours in a week worked past 40.
Krahmer-Steinkamp said her season harvest workers make an average of $25 an hour. They’re paid by the bucket of berries they pick, but overtime also applies to piece-rate payments. Once the new bill takes effect, that pay will jump to $37.5 after enough hours.
“There’s no way I can afford that,” she said.
But farmworker advocates and farmworkers say the bill is long overdue.
“People are excited,” said Ira Cuello-Martinez, policy director for PCUN. “People are happy that they are going to be paid what they deserve, which is the whole purpose of the campaign.”
A long, rocky road to passage of legislation
The policy was the most hotly and heavily debated in last year’s legislature.
Farmworkers and advocates testified agriculture workers’ exclusion from overtime pay was a direct scar of old racist policies. The Federal Fair Labor Standards Act of 1938 excluded farmworkers, who were mostly Black at the time. Today, agricultural workers in Oregon are predominantly Latino.
Farmworkers also perform difficult and dangerous tasks, advocates argued. They work long hours in extreme weather, and deserve to be compensated fairly.
Farmers testified the economic impact of paying workers overtime would be devastating. They warned that farmworkers would actually lose wages, because farmers would be forced to cut hours.
The Oregon Farm Bureau commissioned a report from Highland Economics on the potential economic impact of an agricultural overtime law. The 106-page report predicted dire consequences of overtime.
Margins in agriculture are already slim, the report says, and increased labor costs could force family farms to consolidate or leave the state.
And while some workers may make more money, most will lose wages due to reduced hours, the report predicts.
The Oregon legislature had tried, and failed, to pass overtime before. The five-year phase in period, combined with a tax credit for farmers to help them adjust to the extra labor cost, made last year’s bill more palatable to lawmakers.
The bill’s passage made Oregon the eighth state to mandate paying overtime to agricultural workers.
Outcome still uncertain
Farmers and farm advocates have the same questions now as they did during the legislative session.
The new law looms, but “the economics haven’t changed,” said Jenny Dresler, a lobbyist for the Oregon Farm Bureau Federation.
“It’s not raining money in agriculture,” Dresler said. “It rarely ever is.”
Some farms have looked to California and Washington for answers, and only found warnings. Neither state has released comprehensive data on the impacts of their overtime law, but anecdotally Dresler said she has heard of reduced hours and farmworkers being forced to find second jobs.
California became the first state to pay overtime to farmworkers in 2016.
In testimony to the New York Department of Labor’s Fair Wage Board last January, Daniel Costa with the Economic Policy Institute said that what limited data exist do not suggest drastic changes in California’s agricultural industry. Farmworkers worked the same hours, on average, during the overtime phase-in period as they did before the law was passed.
“California’s farm economy and labor market indicators have held steady since implementation of the state requirement that farmworkers be paid overtime,” Costa said. “Between 2014 and 2018, the five years preceding the overtime phase-in period mandated by AB 1066, California’s farmworkers worked an average of 42.8 hours per week. In the three years that AB 1066’s overtime provisions have been in effect, farmworkers worked an average of 41.9 hours per week, less than one hour difference from the preceding five years.”
Still, Oregon is a different state, grower advocates say. It is less corporate than California; its farms are smaller and family-owned. And its crops are “more labor intensive” than in other states, Dresler said.
Farmworkers also have questions about how the policy will unfold for them. Cuello-Martinez said PCUN has spent the past several months knocking on doors, hosting workshops and fielding questions from members about what overtime will mean for workers.
Some workers were confused about the phased timeline, Cuello-Martinez said. Others had questions about how overtime will translate for workers who are paid based on quantity, or “piece-rate,” rather than per hour (there are exemptions for small farms paying by-piece, but otherwise the law still applies).
But overall, Cuello-Martinez said, workers are “excited.”
“The overwhelming reaction has been positive.”
Unwanted concessions, ways around it
Krahmer-Steinkamp will not pay seasonal harvest workers overtime, if she can avoid it.
Instead, she said her farm will buy another mechanical berry picker, which can cost anywhere from $15,000 used to $300,000 new, “so we don’t have to rely on hand labor.”
“There’s no way we can pay pickers overtime at all,” she said.
She also will adjust her workers’ hours, especially in five years when the threshold reaches 40 hours.
She predicts other growers will do the same. And workers will adjust, too.
“Saturdays might have to be cut short,” she said. “I’m betting what you’re going to see is people picking for one farmer for three or four days, then just going to another farmer. They already bounce around a lot.”
Dresler said each farm will have to figure out what works best for them. “Some are looking at disallowing overtime,” she said. “Some are looking at adjusting salaries, but they also need to maintain a workforce. Some are looking at some kind of combination… I don’t know if there’s any one solution. Different operations have different needs.”
But farms will always need labor, Cuello-Martinez said.
Cuello-Martinez said he is concerned that employers will “try to avoid paying overtime wages.” But he said PCUN will “keep an ear out” for those cases and lean on the Bureau of Labor and Industry (BOLI) as much as possible.
BOLI also is gearing up to monitor and enforce the rule. The agency has hired additional personnel specifically to monitor for overtime compliance. Compliance specialists will not need an official claim or complaint to investigate employers, the agency told the Statesman Journal in September.
Cuello-Martinez said labor advocates made important concessions to help ease the burden on farmers. The five-year phase-in period was longer than advocates wanted. And the tax credit is geared specifically toward small farms and dairy producers.
Small (fewer than 25 employees), non-dairy farms are eligible for a tax credit of up to 90% of excess wages paid in 2023. But it’s a small consolation for farms who have immediate bills to pay, Dresler said.
“They’re looking at their operating budget now,” she said. “The tax credit is not available for at least 18 months.”
It’s also not a consolation farmers asked for, said Jeff Stone, president of the Oregon Nursery Association.
“What sucks is I’m turning into the bad guy because I can’t afford it,” Krahmer-Steinkamp said. “But I get it… [workers] have bills to pay, too.”
More than economics
Among the hundreds of testimonies from farmworkers and advocates were stories of parents missing critical time with their children, using their only free hours to catch up on sleep, or losing wages due to unforeseen circumstances like illness.
Those stories are what get lost in conversations about farmworker overtime, Cuello-Martinez said. The bill is about more than economics.
“People want to spend more time with their families,” he said. “They want to be more present with their kids. They don’t want to spend all of their time working.”
Farmworkers in Oregon make between $14-18 an hour, according to data the U.S. Bureau of Labor Statistics and Department of Agriculture. Without overtime wages, Cuello-Martinez said, many workers “work as many hours as they can” to make ends meet. They get up before dawn, travel long distances to their worksites, work late, drive home.
They don’t have time for basic chores like doctors appointments, DMV visits, or errands. Let alone hobbies.
Overtime wages might give them some of their time back, Cuello-Martinez said.
“It may be less common in the first two years,” he said. “But once we get into the 48 hour and 40 hour [thresholds], people are going to see a difference in their checks and how much free time they have.”
Shannon Sollitt covers agricultural workers through Report for America, a program that aims to support local journalism and democracy by reporting on under-covered issues and communities. Send tips, questions and comments to email@example.com