While Washington state courts and lawmakers tackle some of the unanswered questions regarding an agricultural overtime ruling issued late last year, growers are bracing themselves for financial hits and risks.
Some are simply paying it. Some are not. Some are saving up just in case. And almost everyone is adjusting practices to cut down on overtime, as much as they can anyway.
“I don’t have a set, one-size-fits-all piece of advice,” said Sarah Wixson, an attorney at Stokes Lawrence in Yakima, which frequently represents agricultural employers.
Too much is still uncertain, she said.
In December, the state Supreme Court ruled 5–4 in favor of dairy workers who challenged a state law that exempted agricultural work from overtime requirements. The decision applied only to the dairy industry, though three of the five majority justices wrote in a separate opinion they believed it should apply to all agricultural work. The court also left open whether the decision should apply retroactively.
With Wixson’s help, the tree fruit industry plans to argue why the answer should be no to both questions:
—The seasonal nature of tree fruit labor is much different than year-round dairy work.
—Existing state law created the overtime exemption in the first place, so it wouldn’t be fair to punish growers who had been following it.
Nothing is certain, of course, so growers have decisions to make while they wait. Wixson has heard examples of a variety of responses so far.
Some farmers have simply decided to pay overtime now, not wanting to risk a legal challenge. To establish overtime requirements for farmers outside the dairy industry, workers and advocates would have to file a new case, which could take years to reach a conclusion — like the one from the dairy industry, filed in 2016.
“No one will want to be that next case,” Wixson said.
While labor is a limited commodity, some growers decided to simply beat the critics to the punch and begin paying overtime already.
Other growers have not started paying overtime but have adjusted their schedules as much as they can to avoid letting their workers accrue overtime. In fact, many began doing that a year ago at the advice of Wixson and the Washington State Tree Fruit Association, which she helped represent in the case through amicus briefs.
“I think people have been trying to do that,” she said.
She also advised keeping accurate records of what work would fall into overtime if it was required.
Those bits of advice were echoed by Dan Fazio, CEO of wafla, a Lacey, Washington, agricultural employer organization known for facilitating H-2A hiring.
Another idea, he said, is to implement an arbitration policy that would automatically send disputes between workers and employers to arbitration instead of courts. In 2018, the U.S. Supreme Court ruled that companies may require such policies as a condition of employment. They reduce the risk of a class-action lawsuit, Fazio said.
Meanwhile, growers may want to watch their lawmakers, too. The state Legislature may try to solve some of the outstanding questions.
The Washington State Tree Fruit Association is still formulating its strategy, but members plan to join other agricultural organizations in seeking a legislative statute that would protect growers from retroactivity. That’s one thing most farming groups agree on, association president Jon DeVaney said.
The state statute of limitations on wage and hour claims is three years. After the 2015 state Supreme Court ruling that mandated separate pay for piece-rate rest breaks, a slew of claims sought back pay for three years.
However, that ruling was an interpretation of existing state labor laws. In the overtime case, a state law created the agricultural exemption in the first place, so the Legislature may be sympathetic to growers who were following that law.
“I feel confident that a number of legislators will want to help us,” DeVaney said.
The Washington Winegrowers Association plans to join the same network of farming groups in seeking protection from retroactivity.
“We share a concern with the other ag industries regarding retroactive application of overtime pay should the Washington Supreme Court rule in a case that would extend the dairy decision to other ag commodities,” said Vicky Scharlau, executive director.
The federal Fair Labor Standards Act of 1938, which sets many of the common workplace requirements such as the minimum wage and 40-hour work week, specifically exempts agricultural employment. But in recent years, California and New York lawmakers have enacted overtime pay regulations for farmworkers.
In Michigan and Oregon, agriculture is still exempt from overtime payments.
The Michigan Farm Bureau considers it one of its legislative priorities to keep it that way.
“We continue to carefully monitor the Washington Supreme Court ruling and similar initiatives attempting to erode agricultural overtime exemptions around the country,” said Ben Tirrell, associate legislative counsel for the Michigan Farm Bureau.
In 2016, California legislators created a timetable for farm laborers to be paid overtime in an incremental rollout that would eventually put them at the same basis as most other industries. Previously, agricultural workers were exempt from many labor statutes, including overtime pay. On Jan. 1 this year, overtime for farmworkers kicks in at 8.5 hours in one day or 45 hours in one week. In 2022, it will start at the state’s standard of 8 hours and 40 hours.
About a year ago, a new law in New York took effect that sets a 60-hour work week for farm labor, mandating overtime after that threshold and creating a three-member Wage Board to recommend if that week needs to be shortened. The Wage Board chose to leave the bar at 60 hours for 2021. The mandate also requires a rest day each week that triggers overtime payment and allows farmworkers to unionize but prohibits strikes and walkouts.
In 2017, when the idea first surfaced in New York, Cornell Cooperative Extension studied projected labor cost increases for four apple farms. In the most extreme example, the effective minimum wage would have been boosted 3.6 percent in a 60-hour work week, 9.8 percent in a 50-hour week and 18.7 percent in a 40-hour week.
Cornell University plans another survey in 2021 to measure the effect after the first year, but growers say they don’t want the overtime threshold to drop any more, said Mark Wiltberger, business management specialist for Cornell Cooperative Extension in Newark. •
—by Ross Courtney