Legislative Update – Agricultural Worker Overtime Compensation Bill Signed Into Law

On Monday, September 12, 2016, Governor Jerry Brown signed AB 1066 into law.  The bill modifies the overtime rules applicable to California farmworkers, and brings them in line with other California employees.  Currently, employees covered by Wage Order 14 receive overtime compensation (time and a half) when they work more than 10 hours in a day, or more than 60 hours in a single workweek.  In contrast, most California employees receive overtime compensation when they work more than 8 hours in a day, or more than 40 hours in a single workweek.  Soon farmworkers will enjoy these same overtime protections.

The new overtime laws for farmworkers will be phased in over a period of four years.  Overtime compensation will be owed as follows: (1) in 2019, for time worked over 9.5 hours in a day, or 55 hours in a week; (2) in 2020, for time worked over 9 hours in a day, or 50 hours in a week; (3) in 2021, for time worked over 8.5 hours in a day, or 45 hours in a week; and (4) in 2022, for time worked over 8 hours in a day, or 40 hours in a week.  Double time compensation will be owed for time worked over 12 hours in a day beginning in 2022.  Agricultural businesses with fewer than 25 employees will have an additional three (3) years to comply with the new overtime rules. Other provisions of the Labor Code regarding compensation for overtime work will apply to farmworkers beginning January 1, 2017.

The passage of AB 1066 certainly adds another hurdle into an already complicated employment law landscape in California, and will no doubt increase the burden on one of this state’s most important industries.  California agricultural businesses will have to consider restructuring their work schedules and will need to make other adjustments (some by the beginning of 2017) to ensure compliance with this new law.