BILL ANALYSIS Ó
AB 2757
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Date of Hearing: April 20, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
AB
2757 (Gonzalez) - As Amended March 30, 2016
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Urgency: No State Mandated Local Program: YesReimbursable:
No
SUMMARY:
This bill establishes the Phase-In Overtime for Agricultural
Workers Act of 2016 to provide overtime pay incrementally to
California farmworkers over four years so that by 2020, workers
that work more than eight hours a day, or 40 hours a week, will
be paid one and one-half times that employees regular rate of
pay. Specifically, this bill:
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1)Requires, beginning July 1, 2017, any person employed in an
agricultural occupation employed more than 9.5 hours in any
one workday or working in excess of 55 hours in any one
workweek, to receive one and one-half times that employee's
regular rate of pay for all hours worked over 9.5 hours in any
workday or over 55 hours in any workweek.
2)Requires, beginning January 1, 2018, any person employed in an
agricultural occupation more than 9 hours in any one workday
or working in excess of 50 hours in any one workweek, to
receive one and one-half times that employee's regular rate of
pay for all hours worked over nine hours in any workday or
over 50 hours in any workweek.
3)Requires, beginning January 1, 2019, any person employed in an
agricultural occupation more than 8.5 hours in any one workday
or working in excess of 45 hours in any one workweek, to
receive one and one-half times that employee's regular rate of
pay for all hours worked over eight and one-half hours in any
workday or over 45 hours in any workweek.
4)Requires, beginning January 1, 2020, any person employed in an
agricultural occupation more than 8 hours in any one workday
or working in excess of 40 hours in any one workweek, to
receive one and one-half times that employee's regular rate of
pay for all hours worked over 8 hours in any workday or over
40 hours in any workweek.
5)Defines "employed in an agricultural occupation" consistent
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with the Wage Order of the Industrial Welfare Commission
affecting agricultural workers.
6)Requires, beginning January 1, 2020, any work performed by a
person employed in an agricultural occupation in excess of 12
hours in one day shall be compensated at the rate of no less
than twice the employee's regular rate of pay.
7)Requires all other provisions of existing law regarding
compensation for overtime work to apply to workers in an
agricultural occupation beginning January 1, 2017.
8)Requires the Department of Industrial Relations (DIR) to
update Industrial Welfare Commission Wage Order 14 to be
consistent with this bill.
FISCAL EFFECT:
Administrative costs in the range of $326,000 to $586,000 (Labor
Enforcement and Compliance Fund), assuming a 10-20% increase in
wage claims annually during the four year implementation phase.
These cost estimates reflect resources for additional staffing
and outreach to employers and employees. The bill proposes a
dramatic shift in the industry and since the hours and rates of
pay change annually during the implementation phase, DIR notes
that employees may not know their rights and employers may not
know which timeframe applies for any given year. Once the bill
is fully implemented, costs are likely to range between $20,000
to $30,000 annually.
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COMMENTS:
1)Purpose. This bill removes the exemption for agricultural
workers that excludes them from the daily and weekly overtime
requirements, which requires overtime compensation for working
in excess of 8 hours in one workday or 40 hours in a workweek.
The implementation of the updated overtime eligibility for
agricultural workers will be phased-in over 4 years. According
to the author, this bill extends fair overtime compensation to
hundreds and thousands of agricultural workers, which continue
to serve an important role in our State's economy.
Agricultural workers will join the millions of Californians
that already benefit from the same protections that this bill
seeks to provide.
2)Background. The Federal Fair Labor Standards Act (FLSA) was
established in 1938 and provides for minimum requirements with
respect to certain labor standards, including minimum wage and
overtime. The overtime provisions of the FLSA were not
extended to agricultural employees. In 1941, the Legislature
exempted all agricultural employees from the statutory
requirements of overtime, similar to the FLSA. This statutory
exemption was retained when the eight-hour day was codified in
1999.
Despite this statutory exemption, the Industrial Welfare
Commission (IWC), under its authority, promulgated overtime
provisions beyond the traditional eight-hour standard of
California law. Currently, the applicable wage order for
agricultural employees requires the payment of overtime wages
when an agricultural employee works longer than 10 hours in a
single day, and more than six days during any workweek.
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3)Support. This bill is sponsored by the United Farm Workers
(UFW), who state that it has been 77 years since farm workers
were excluded from the wage protections and maximum hour
standards through the enactment of the FLSA. Excluding farm
workers is part of our country's shameful legacy that
initially targeted African-American who were farm workers in
the 1930s. This bill rights a wrong that can no longer be
justified or tolerated in a society where equal rights and
equal justice are supposed to be more than academic theories
or political rhetoric.
4)Opposition. The Agricultural Council of California opposes
this bill. They state that farmers, their employees and their
operations are critically affected by the uncontrollable whims
of nature and the seasonality of agricultural production. They
argue that agriculture needs greater flexibility in scheduling
work than do other industries and that state and federal laws
currently recognize this reality. They state that California
regulations are one of the most generous in the country with
regard to overtime pay for agricultural workers. The
opposition notes that the cost of farming in California has
risen by 36% over the past few years. Consequently, farmers
are likely to avoid the additional costs imposed by this bill
by limiting worker hours and hiring more workers to make up
the difference.
Analysis Prepared by:Misty Feusahrens / APPR. / (916)
319-2081
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