Two bills were signed into law that will have dramatic effects on all agricultural businesses in California. The one most people are familiar with is the minimum wage law that was signed back in April that will result in a $15 minimum statewide by 2022. People outside of agriculture, however, may not be aware that another bill, with possibly larger effects, was also signed into law–AB 1066. This law removes the overtime exemption for agricultural employers and means that by 2022 employees will be paid overtime after working 8 hours a day or 40 hours a week as opposed to the current 10 hours a day and 60 hours weekly. Agriculture is highly seasonal in our area—during the busy season 10 hour days and 60 hour weeks are the norm, so this will obviously have a huge effect.
There is great uncertainty among growers I know about how things will shake out. As one analyst said, it is an experiment whose effects won’t be known until it fully takes effect. I fear that organic farms, which are inherently more labor intensive, will be at a further disadvantage compared to conventional farms. I am also concerned that larger, corporate operations, which can afford the wave of mechanization that is sure to come, will have an even larger advantage over small farms like ours. Already, large conventional growers in our area, through the use of herbicides, chemical thinners and mechanized harvesters, are able to produce crops of lettuce and spinach with very little labor. The exodus of labor intensive crops like strawberries and raspberries for countries like Mexico, where they pay less than $15 dollars for an entire day is another very real possibility.
What this means for consumers is that prices are certain to increase—there is no way around it. The gap between organic and conventional prices will likely increase as well–whether this will be enough to drive consumers away from organic remains to be seen.
From our perspective we find the goals of both these laws laudable. We have an incredible crew of responsible, hardworking folks who deserve to earn a decent living. Relative to other operations in our area we have always paid well. If we are able to maintain our farm on a sound financial footing, we agree with what these laws are trying to accomplish, but lots of questions remain.
Since few farms can afford to pay overtime with such a high minimum wage as standard practice, one would assume that there will be an increasing demand for labor to fill the void, but where will this come from? Labor is already extremely tight throughout our area. There are signs up everywhere in our valley from growers seeking people to pick their crops. And stories about strawberry or other crops being disced in for lack of labor to pick them abound. Whether an increase in the minimum wage and overtime pay will be enough to draw laborers back into agriculture from other areas remains to be seen.
What also remains to be seen is whether an increase in produce imported from countries with lower labor and environmental standards will mean unfair competition for those who stick it out here. Even small, direct-market, farms like ours are affected by what consumers are paying in mainstream grocery outlets. And, although I am certainly not an expert on international trade, it would have been good to see a concurrent effort to protect markets here from a flood of imported produce that may undo a lot of the good these laws were trying to accomplish.
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