Some small farmers say Oregon’s new farmworker overtime law has them planning their exit strategy. Others hold out hope for a solution which accommodates them.
Jeff Heater did not mince words when discussing the legislature’s passage of HB 4002, which made Oregon the eight state in the nation to mandate overtime pay for farmworkers.
“It’s like there’s a mountain of crap going downhill and all they’ve given us is a tiny martini umbrella to protect ourselves,” says Heater, a cherry and apple grower who also serves on the Columbia Gorge Fruit Growers’ board of directors.
Heater’s organization joined with the Oregon Farm Bureau, the Oregon Association of Nurseries and a dozen other farm and ranch owner associations across the state to lobby against the bill during the 2022 Legislative Session, which they argued would cause severe economic damage to small farms and their employees.
Now that the bill has passed, the coalition is trying to convince Gov. Kate Brown to veto the law, and they say they’ll participate in the rulemaking process.
Introduced by Rep. Andrea Salinas (D-Lake Oswego), HB 4002 removes a longtime exemption to labor laws that require most employers to pay workers 150% of their hourly rate if they work more than 40 hours per week. Currently, federal law exempts agricultural workers from mandatory overtime compensation. The exemption dates back to passage of the Fair Labor Standards Act in 1938, which exempted field workers — then mostly African American — to win the support of Southern Democrats. According to the Department of Labor, 83% of farm workers currently working in the U.S. are Hispanic.
The new protections will be phased in beginning Jan. 1 of 2023. Farmers must pay 150% overtime to any employee who works over 55 hours in a week. The threshold lowers to 48 hours a week in 2025 then drops to 40 hours in 2027.
Along with the phase-in period, farmers will also receive a tax credit equal to 60% of overtime wages paid to the employee, but will also decrease over time.
The last few years have been tough for farmers. In 2021, The National Oceanic and Atmospheric Administration estimates the sector suffered $12.5 billion in losses due to crop loss from severe weather patterns, such as drought. A 2021 reportby the Ag CEO Council detailed the sector’s difficulties with supply chain disruptions and the country’s labor shortage, and concluded that their “optimism has faded into a desire to simply not do worse” than previous years.
Prior to that, the previous administration’s trade war cost farmers $27 billion in lost revenue over 2018 and 2019, according to a report this year from the USDA’s Economic Research Service.
Lesley Tamura, a fourth-generation farmer in Hood River and board member of Columbia Gorge Fruit Growers, says the phase-in tax credit does little to alleviate the pressure.
“By the time that money comes in, we could already be out of business. no one is hanging their hats on ‘at least we have the tax credit,” Tamura tells Oregon Business.
Since harvest time is in seasonal windows, it requires long hours of intense picking, giving employers limited options to avoid paying overtime. Tamura says large farms will likely be able to shoulder the cost, and better take advantage of the tax credit.
During a Zoom interview with OB, Tamura got teary-eyed when she talked about potentially ending her operation, but she says the law’s passage has made it unlikely her farm will survive in the next two years without support.
“We have to think about what we want the future of agriculture in our state to look like. Do we want a future where we always have access to affordable, nutritious food or do we want our food supply to be run by megacorporations?” says Tamura.
Jeff Stone, executive director of the Oregon Association of Nurseries, says he was blindsided by the vote, which passed along party lines. He had been hopeful the final version of the bill would take members’ concerns into account, but that didn’t happen, he says.
“We really had this ‘ah-ha’ moment at the end of the house session. But this process was the worst and most bad I have ever seen in my 30 years of public life,” says Stone. “That vote hurt. It felt like they were stabbing me in the leg and giving me Pepto-Bismol.’”
Stone says he and the coalition have made a direct appeal to the governor for veto.
Should that fail, the coalition is also planning to participate in the Bureau of Labor and Industry’s rulemaking process for HB 4002 at the Bureau of Labor and Industry.
“She really listened to us because of the names of the people who signed on,” says Stone. “I play to the buzzer. It’s 4th and 37, and there’s 40 seconds left, but ain’t over ‘til it’s over.”
The passage of HB 4002 has also put a halt to a court case challenging Oregon’s practice of exempting farmworkers from overtime law.
In November the Oregon Law Center, on behalf of Oregon farmworkers Javier Ceja and Anita Santiago and Salem nonprofit Mano a Mano Family Center, sued BOLI, arguing the government agency was compelled to set farm worker overtime laws on its own.
Earlier this month an Oregon Court of Appeals judge paused proceedings on the case until the state law takes effect.
Casey Kulla, a farmer who currently serves on the Yamhill County Commission and is running for state labor commissioner, is optimistic about HB 4002, but also says he expects the BOLI lawsuit to continue even after the law is enacted as a way to “continue the pressure on BOLI” to make sure the law is robustly enforced.
Kulla, who supported the passage of HB 4002, says the rulemaking process is another chance to make the bill work in the best interest of Oregon agriculture. He says large changes like adding exemptions for size and seasonality are not likely to occur during the rulemaking process — but that options to amend HB 4002 could still come online if enough problems arise.
“There is an opportunity in rulemaking to come back with technical fixes if some elements are unworkable,” says Kulla.
“If it becomes truly apparent that smaller farms are struggling or there are concerns about seasonality, we can do a technical fix in-statute. But that is going to require everyone to be on board,” Kulla adds.” That’s the only way technical fixes can be a success.”
Like Tamura, Heater tells OB he is planning his divestment strategy. He says he hopes it will not be necessary, but that his current financial situation paints a bleak picture.
“It’s like the bully keeps coming after you in the school yard. We tried doing things the right way. Get our story out into the world. But the hits keep coming and at some point you have to know when to leave,” Heater says.
Kulla acknowledged the economic pressures facing small farm owners, and said the state has a long way to go making farmers’ lives easier.
“Engaging farmers needs to be part of our statewide strategy. I think there’s a lot of potential for small farms to help build stronger markets and supply chains connecting urban and rural areas,” says Kulla. “I really think the state needs to say demonstrably that small farms are cared about.”
Immigration reform, advancements in robotics and creating public-private partnerships — which a 2021 report published in Food Security found imperative to accelerating global food security — could help small farms reach new markets, lower costs and develop new revenue streams.
It’s a political march the coalition says it is ready for.
“If there’s one silver lining to all this, it’s that small farm owners are connected like never before,” says Heater.
“We’re awake, we’re fighting and we’re not going to let this go,” says Stone.
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