A new subsidy in the state budget aims to help farm owners afford overtime

Workers and advocates are celebrating, but farm owners are saying the tax credit won’t be enough to offset new costs, especially if a 40-hour workweek is instituted.

New York will soon offer farmers a tax credit to help them afford newly required overtime pay for their workers.

New York will soon offer farmers a tax credit to help them afford newly required overtime pay for their workers. genekrebs/Getty Images

A largely overlooked provision included in the state budget could have big impacts on the state’s farm owners and farm workers. As initially proposed by Gov. Kathy Hochul in her executive budget, New York will soon offer farmers a tax credit to help them afford newly required overtime pay for their workers. But while the subsidy has farm worker advocates saying it paves the way for lowering the overtime threshold, members of the agriculture industry say it's still not sufficient. 

Under a 2019 law that passed after years of advocacy, the state set first-time overtime provisions for farm workers, as well as other labor protections afforded in other industries. At the time, that meant a 60-hour work week, with anything over that deemed as overtime eligible. Farmers and members of the agriculture industry lobbied against the law, saying that it would force them to cut hours, thus driving workers out of state. 

To help pay for the new overtime requirements, Gov. Kathy Hochul proposed implementing a tax credit for farmers so that the state could subsidize part of the cost. Tucked within thousands of pages of budget language and overshadowed by other controversial issues that dominated budget discussion is a version of that tax credit, offering farmers a way to adhere to the new law without cutting hours. But the two sides of the discussion have reacted to the tax credit in very different ways. 

At issue is a recent Farm Laborers Wage Board recommendation to lower the overtime threshold from 60 to 40 hours per week. The board, created as part of the 2019 law, said that change would phase in over a decade. Farm worker advocates applauded the decision, and viewed the tax credit as a means to permit it with as little disruption as possible. “The governor was very thoughtful and creative in setting up a way to make this work for everybody,” the Rev. Richard Witt, executive director of Rural & Migrant Ministry Inc., told City & State. He said advocates like himself and state leaders have listened to concerns of farm owners about the inability to afford overtime costs and “fully expect” the New York Farm Bureau and other farm-owner interests to drop their opposition to the 40-hour work week. They had opposed the wage board’s recommendation and called on Hochul to override its vote. “Farmers should be thankful to the Justice for Farmworkers Campaign for helping leverage another subsidy to them,” Witt added.

However, members of the Grow NY Farms coalition, which fought against the overtime law and the lowered threshold, remain adamant in their belief that the 60-hour workweek should remain in place. “When government has to subsidize a policy with a tax credit, it's just bad policy,” AJ Wormuth, a director of the Northeast Dairy Producers Association, told City & State. “So the policy itself was bad.” Wormuth said he would prefer the money subsidizing overtime pay go to other priorities to help the agriculture industry, and that it still isn’t enough to offset the costs associated with lowering the threshold.

The decision on the 40-hour workweek, which could begin implementation in 2024, is not set in stone as the labor commissioner could override the wage board’s votes. When that might happen remains up in the air as the board has yet to release its official report on the matter. “The commissioner will have 45 days from when she receives the report to review the recommendations and announce her decision on the overtime threshold for farm laborers,” the state Department of Labor said in a statement. When asked whether Hochul would direct Labor Commissioner Roberta Reardon to accept the overtime recommendation, spokesperson Jim Urso said in a state that the administration is “confident that Commissioner Reardon will review the Board’s recommendations closely and ensure that the final decision puts the state on a path to improve the lives of farm workers while protecting New York’s vital farm industry.”

With the agriculture industry’s continued resistance to lowering the overtime threshold, lawmakers too are pushing for the governor and Reardon to follow through on the overtime recommendation. “The tax credit we passed in the budget is an acknowledgment in good faith that we recognize the strain that the pandemic has put on New York’s farms, but we can’t compromise on addressing generations-old worker inequities,” state Sen. Jessica Ramos, chair of her chamber’s Labor Committee and sponsor of the 2019 law, said in a statement to City & State. “Hochul can give both farmers and workers a solid transition away from Jim Crow era labor standards by adopting the wage board’s democratically-made decision.”