Portland, Ore. (May 11, 2022) - On April 18, 2022, Oregon Governor Kate Brown signed HB 4002, which will begin, in 2023, a five-year phase-in process for Oregon employers to pay agricultural workers overtime requirements. In enacting this law, Oregon joins a handful of states – including California, Washington, and New York – that have removed exemptions to exclude agricultural workers from overtime laws.
Historically, the Federal Labor Standards Act (FLSA), which establishes the federal minimum wage and overtime requirements, has excluded farmworkers from overtime, and each state has established its own laws regarding wages. The proposed legislation was highly contentious, and more than a thousand individuals submitted testimony. According to the U.S. Bureau of Labor and Statistics, the State of Oregon has more than 86,000 farmworkers.
As mentioned above, the new overtime requirement will be phased in over a five-year period. Farmers will have to pay time and a half to agricultural workers who work over 55 hours per week, beginning in 2023. The threshold will drop to 48 hours in 2025 before being fully phased in at 40 hours in 2027.
The new law temporarily provides tax credits over six years to farmers to alleviate the higher labor costs. Most farmers will be eligible for one of three tiers of tax credits, based on whether the farmer employs 25 or fewer workers, 25 to 50 workers, or more than 50 workers. The tax credits will incrementally decline between 2023 and 2028.
The new overtime requirements will exclude individuals who are otherwise exempt from wage requirements under ORS § 652.020(1) and employees who qualify as administrative, executive, or professional salaried employees.
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