BILL ANALYSIS                                                                                                                                                                                                    






                 Senate Committee on Labor and Industrial Relations
                               Mark DeSaulnier, Chair

          Date of Hearing: April 28, 2010              2009-2010 Regular  
          Session                              
          Consultant: Gideon L. Baum                   Fiscal:No
                                                       Urgency: No
          
                                  Bill No: SB 1121
                                   Author: Florez
                      Version: As Introduced February 18, 2010
          

                                       SUBJECT
          
                        Overtime wages: agricultural workers.


                                      KEY ISSUE

          Should the Legislature require that agricultural employees are  
          eligible for overtime after the 8th hour in a workday and ensure  
          the provision of meal periods?
          

                                       PURPOSE
          
          To withdraw the exemption on agricultural workers from overtime  
          and meal period requirements.


                                      ANALYSIS
          
           Existing law,  with certain exceptions, defines a day's work as  
          eight hours of labor.  Any additional hours worked in excess of  
          eight hours in one day, or a 40-hour workweek, must be  
          compensated with the payment of overtime. 
           
          Under existing law,  the payment of overtime compensation is as  
          follows: 

                 Any work in excess of eight hours in one workday, any  
               work in excess of 40 hours in any one workweek, and the  
               first eight hours worked on the seventh day of work in any  
               one workweek shall be compensated at the rate of no less  
               than one and one-half times the regular rate of pay for an  









               employee;

                 Any work in excess of 12 hours in one day shall be  
               compensated at the rate of no less than twice the regular  
               rate of pay for an employee; 

                 Any work in excess of eight hours on any seventh day of  
               a workweek shall be compensated at the rate of no less than  
               twice the regular rate of pay of an employee. 

           
          Existing law  provides that the standard requirements for the  
          payment of overtime compensation do not apply where:

             a)   An employee submits a written request to make up work  
               time that would be lost as a result of a personal  
               obligation of the employee if the make-up work time is  
               performed in the same workweek in which the work time was  
               lost.  Such make-up work time may not be counted towards  
               computing the total number of hours worked in a day.

             b)   An alternative workweek schedule has been adopted  
               pursuant to Labor Code Section 511.  Under this procedure,  
               an employer may propose an alternative workweek for no  
               longer that 10 hours per day within a 40-hour workweek and,  
               if it is approved, the employer is not required to pay  
               overtime compensation for such a work schedule.  The  
               employer must specify the workers in a work unit and  
               conduct a secret ballot election.  If two-thirds of the  
               workers approve, the new workweek is deemed adopted.  The  
               employer is required to make a reasonable effort to find a  
               work schedule not to exceed eight hours for a worker unable  
               to work the alternative schedule.

             c)   Employees have adopted an alternative workweek schedule  
               pursuant to a collective bargaining agreement if the  
               agreement expressly provides for wages, hours of work, and  
               working conditions of the employees, and if the agreement  
               provides premium wage rates for all overtime hours worked  
               and a regular hourly rate of pay for those employees of not  
               less than 30 percent more than the state minimum wage. 

          Hearing Date:  April 28, 2010                            SB 1121  
          Consultant: Gideon L. Baum                               Page 2

          Senate Committee on Labor and Industrial Relations 
          








             d)   An alternative workweek schedule is inapplicable because  
               the work relates to cases of emergency or the protection of  
               life or property, to the movement of trains, or to certain  
               hardship exceptions as specified by the Chief of the  
               Division of Labor Standards Enforcement.
           
          Existing law  requires, with certain exemptions, that all  
          employees receive a meal break of 30 minutes before the start of  
          the 5th hour of work, unless the work period is no more than six  
          hours and both the employer and the employee choose to waive the  
          meal period by mutual consent.  

           Existing law  requires that if the work period is more than ten  
          hours, a second meal period of 30 minutes must also be granted  
          to an employee.  This second meal period can be waived by the  
          mutual consent of the employer and employee, but only if the  
          work period is no more than 12 hours, and the first meal period  
          was not waived.  

           Existing law  exempts employers of agricultural workers from  
          these requirements.
           
          This bill  would require that employers of agricultural workers  
          must follow these requirements.


                                          



                                      COMMENTS
          
          1.  Legislative Background and Regulatory Requirements for  
            Agricultural Workers:

            In 1938, Congress passed the Fair Labor Standards Act (FLSA),  
            which set statutory minimum requirements for labor laws in all  
            states.  The FLSA includes, among other requirements, overtime  
            provisions, but these provisions were not extended to  
            agricultural workers.  However, as with all provisions with  
            the FLSA, states are allowed to exceed the requirements laid  
            out in the FLSA.
          Hearing Date:  April 28, 2010                            SB 1121  
          Consultant: Gideon L. Baum                               Page 3

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            The issue of overtime for agricultural workers in California  
            law was first dealt with in 1941.  Previously, the Labor Code  
            had been mute on agricultural employees, but in 1941 the  
            Legislature chose to exempt all agricultural employees from  
            the statutory requirements of overtime, similar to the FLSA.    
            Subsequently, the statutory overtime exemption has largely  
            remained unchanged, and was indirectly extended to meal  
            periods in 1999.  

            This statutory exemption, however, did not prohibit the  
            Industrial Welfare Commission (IWC) from legally promulgating  
            overtime provisions that were applicable beyond the 8-hour  
            timeframe.  Currently, the applicable wage order requires the  
            payment of overtime wages when an agricultural worker works  
             longer than 10 hours in a single day, and no more than six  
            days during any workweek  .  Similarly, the applicable wage  
            order requires a meal period after the 5th hour of work, but  
            unlike statute is silent on a second meal period after the  
            10th hour of work.  

            Similarly, this statutory construct would not prevent an  
            employer from agreeing to pay overtime wages before the 10th  
            hour.  Such an agreement could be structured through a company  
            policy or through a contract, such as a collective bargaining  
            agreement.

          2.  Proponent Arguments  :
            
            Proponents argue that agricultural workers face increasingly  
            difficult working conditions for very low pay.  Proponents  
            note that agricultural employees are completely dependent on  
            their employers for the provision of bathrooms and clean  
            water, and the agricultural workers frequently work in  
            incredibly hot weather conditions, yet can only receive  
            overtime after they work 10 hours in a workday, or sixty hours  
            in a workweek.  Proponents believe that agricultural employees  
            should not be treated in a unique or distinct way, and that  
            the two-tiered overtime provisions are antiquated and should  
            be abolished.

          3.  Opponent Arguments  :
          Hearing Date:  April 28, 2010                            SB 1121  
          Consultant: Gideon L. Baum                               Page 4

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            Opponents note that agriculture is critically affected and  
            dependent on weather conditions and the seasonality of  
            agricultural production, and opponents argue that this  
            requires greater flexibility in scheduling work than other  
            industries, which is currently reflected in both federal and  
            state labor laws.  Opponents also argue that California  
            already has the nation's most progressive labor protections  
            for agricultural production, and that no other state currently  
            requires overtime once agricultural workers have exceeded the  
            40 hour work week.  Moreover, opponents argue that due to  
            razor-thin profit margins, farmers will be forced to cut hours  
            and layoff employees if they face an increase in labor costs.   
            Opponents believe that this will hurt the California economy,  
            as agriculture has aided the state's recovery during the  
            current economic downturn, as well as place the state's  
            agricultural industry at a competitive disadvantage.   

          4.  Prior Legislation  :

            AB 841 (Dickey), Statutes of 1941, Chapter 1264, originally  
            created the overtime exemption for agricultural workers.


                                       SUPPORT
          
          California Applicants' Attorneys Association
          California Commission on the Status of Women
          California Communities United Institute
          California Employment Lawyers Association "CELA"
          California Labor Federation
          California Rural Legal Assistance Foundation
          

                                     OPPOSITION
          
          Agricultural Council of California
          Alliance Western Milk Producers
          Allied Grape Growers
          California Association of Nurseries & Garden Centers
          California Association of Wheat Growers
          California Association of Winegrape Growers
          Hearing Date:  April 28, 2010                            SB 1121  
          Consultant: Gideon L. Baum                               Page 5

          Senate Committee on Labor and Industrial Relations 
          








          California Bean Shippers Association
          California Chamber of Commerce
          California Citrus Mutual
          California Cotton Ginners & Growers Association
          California Farm Bureau Federation
          California Grain & Feed Association
          California Grape and Tree Fruit League
          California Pear Growers Association
          California Seed Association
          California State Floral Association
          California Warehouse Association
          California women for Agriculture
          Family Winemakers of California
          Grower-Shipper Association of Central California
          Grower-Shipper Vegetable Association of Santa Barbara and San  
            Luis Obispo Counties
          Nisei Farmers League
          Pacific Coast Renderers Association
          Pacific Egg & Poultry Association
          Ventura County Agricultural Association
          Western Agriculture Processors Association
          Western Growers
          Western United Dairymen
          Wine Institute
          14 Individuals


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          Hearing Date:  April 28, 2010                            SB 1121  
          Consultant: Gideon L. Baum                               Page 6

          Senate Committee on Labor and Industrial Relations