Senator Shannon Grove (R-Bakersfield) has introduced SB 628, a bill aimed at creating a tax credit for agricultural employers to help offset the costs of providing overtime wages to farmworkers. The legislation, co-sponsored by the California Association of Winegrape Growers (CAWG) and the California Farm Bureau, seeks to balance financial relief for struggling agricultural businesses while ensuring farmworkers have greater opportunities to earn overtime pay.
Grove emphasized that California's farmers and farmworkers are the backbone of the agricultural economy, but overtime mandates have made it difficult for farmworkers to secure sufficient hours and for growers to bring their products to market. She called SB 628 a "commonsense solution" that provides relief to agricultural businesses while supporting farmworkers' ability to earn more.
SB 628 proposes a payroll tax credit to allow agricultural employers to offset overtime wage costs, defined as the difference between employees' overtime rate and their regular rate of pay. This initiative aims to increase available overtime hours for farmworkers, improving their take-home earnings and providing financial stability in rural communities.
The push for this legislation comes as the agricultural sector faces economic hardships. Natalie Collins, president of CAWG, pointed to the challenges growers are facing, particularly with California experiencing its smallest winegrape harvest in 20 years. She argued that the phase-in of agricultural overtime under AB 1066, passed in 2016, has ultimately reduced farmworker earnings and that legislators must support growers if they want to ensure increased take-home pay for farm workers.
California Farm Bureau President Shannon Douglass echoed this sentiment, highlighting the financial strain on farmers. She cited research showing that placing the burden of overtime wages on farmers has harmed both agricultural businesses and farmworker families. She described SB 628 as a "sensible solution" that will help farmers continue food production while increasing farmworkers' earnings.
A 2023 study by the University of California, Berkeley, titled California's Overtime Law for Agricultural Workers: What Happened to Worker Hours and Pay?, found that since the "Phase-In Overtime for Agricultural Workers Act of 2016" became law, farmworkers have been earning less. The study suggested that the law might not be benefiting the very workers it was designed to protect.
SB 628 follows the example of other states that have recognized the unintended consequences of agricultural overtime laws. Oregon provides a refundable income tax credit for employers based on overtime wages paid to farmworkers, a policy in place through 2028. Similarly, New York offers a tax credit through 2032 for agricultural businesses covering eligible overtime wages.
With the introduction of SB 628, Senator Grove, CAWG, and the California Farm Bureau are advocating for policies that ensure farmworkers can continue to earn overtime pay without placing unsustainable financial burdens on the agricultural industry. They stress the importance of designing policies that genuinely benefit farmworkers rather than unintentionally reducing their wages.
To read the full report, click here.
For more information:
Brooke Lackey
Senator Shannon Grove
Tel: +1 916 223 3282
Email: Brooke.Lackey@sen.ca.gov
Barbara Arciero
California Farm Bureau
Tel: +1 (916) 561-5574
Email:barciero@cfbf.com
www.cfbf.com