Three Hearings Down—What Have We Learned?

As we draw closer to some decision by the New York State Legislature on what will be the details in the final version of the Farm Worker Labor Bill we should try to reflect on what we have seen.

To begin with, I was very proud of the quality of each and every testimony given by our industry. No two were alike. Each exposed a unique aspect of agriculture. Regardless if the testimony was from Morrisville or out on Long Island the message was consistent. Here are some of the conclusions offered by everyone.

To begin, this issue will impact all types of agriculture. Fruit, dairy vegetable or any other type will be impacted. Each stated the reality that they are Price Takers. Supply and demand will dictate the returns. We do not have the ability to increase our prices to offset increases in our individual operation. We either can or cannot succeed under the existing price structure. Unlike public government we cannot vote in an increase.

Every report stated a huge respect and dependency on their employees. They knew how dependent they were in having these people in their operation. Every effort was made to meet employee needs.

Paul Baker,
Executive Director
NYSHS

Almost every farm reported long repeated years of consistent service. Likewise, employees when asked reported a comfort in the relationship they had with their employers.

What struck me was the reality that we were being asked to support a legislative change to a system that was not broken or under stress. Usually new legislation is created to replace flawed conditions. Could each situation be improved? Yes, of course.  It appeared that when an issue did arise the employee and employers were able to discuss and make changes.

The two large issues seem to be collective bargaining and overtime. Farms in general were not really opposed to giving employees the right to collective bargaining so long as they were assured of a no strike clause. As one farmer stated we have been “collectively bargaining” for years with our employees on a farm by farm basis.

Employees that testified showed a keen understanding of the economics of the farms they were working on. They understood that the farms were offering all that was possible. They also seemed to understand that yes it would be nice to receive more money but the farm could not pay 50% more and not have any more work accomplished. They wanted to have the unlimited hours and the stability of being employed in one place. They did not wish to join so many other Americans that today are struggling to make ends meet with two jobs.  I wager many US citizens wish they could have greater than 39 hours of work each week like these farm employees.

In short, it really comes down to the fact that in production agriculture we work on often times impossible margins. Competition for market share too often leaves low returns. I think these hearings have actually exposed the true economic reality of agriculture. It is not that farms are willingly underpaying their help but that they simply are maxed out. So long as technology does not offer a cheaper way to bring the food to the market place we will see this struggle to satisfy everyone’s expectations.

Farming is certainly not for everyone. It is a demanding vocation with mixed returns. I feel it will always be dependent on world, national and local supply and demand. We are all very fortunate to have people who are willing to accept the challenge of agriculture and those who find value in working in it. Governments have the ability to make farms less profitable but they do not have the ability to guarantee economic success. While some may idealistically state this is solely a moral issue the reality of it is a simple question of basic economics.

 

Public Hearing on Farm Worker Fair Labor Practice Act Senate Bill 2837, SUNY Sullivan, Loch Sheldrake, NY

My name is Paul Baker. I grew up in Niagara County on a fruit and vegetable farm. I was the fifth generation to work on this farm. My Son Brett would follow me and be the last, sixth generation.  I have always lived with “farm workers.”  My father worked for over 25 years with the same migrant family from Florida. In the winter they harvested citrus in the Ocala area of Florida. When the citrus was harvested they traveled to our farm to harvest our crops. Each mid-November they returned to Florida to the citrus.

I grew up with these people. After work I played basketball with them in the barn. Once, when I was struggling with my high school French studies, my Dad’s foreman, a WWII vet, made me only converse with him in French. A language he learned while serving our country in the war. Later when the farms labor was from Jamaica my son would go each night to the Housing and enjoy music with the men, his friends.  I tell you this because in agriculture we have a very strong bond with our help. They really are an extended family. For 18 years we welcomed basically the same men to our farm to complete the growing cycle. The housing was always very close to our own. After my Father passed away my Mother was asked if she felt unsafe living so close to the camp? Her reply was” I feel much more at risk when they are not there.”

I tell you this multi-generational tale to try to illustrate the unique bond we have with our employees. To suggest that we would not have their best interest in mind is to not comprehend this bond. If we mistreated our employees, then why did they come back each year?

Paul Baker,
Executive Director
NYSHS

I have heard in the two previous hearings statements to the effect that farms could always pay more to their employees. This is not an economic issue but a moral one. Over the years we have had to find ways to offer increased wages. Cost of living continue to increase. History will support me when I tell you that agriculture has met this challenge through research  improvements in farming practices. Higher yielding orchards, improved root stocks, labor saving equipment have been ways we have been able to meet these increases in labor costs.

In principle I find many of the items in this bill misleading. To people who do not know our history you would be led to believe our employees do have basic protections such as workers compensation or unemployment. All of our housing is state and often federally inspected. Farm owners, for years, attend self-improvement seminars on compliance and ways to improve human resources.

I think it is time for both sides to try to find ways to continue this long positive history of farm employees in New York State. To do this, both sides must agree that at the conclusion of this effort we will have a strong base for agriculture in our State. Only then can both sides continue. Yes this is a moral issue. Unfortunately, even in houses of worship they find it necessary to pass the plate. Economics is a fact of life.

I think I speak for farms across this State. We are willing to discuss issues and find solutions to meet your request for the big questions of the day, those are at what level can we afford overtime and collective bargaining, so long as it has a no strike clause. I hear many want a mandatory day of rest included. I would offer that often this should be left to the wishes of the employees and the seasonal pressures of the moment.

I am here to tell you that the system is not broken. We do not have employees on strike or in the streets carrying protest banners. Can we improve conditions? Every human resource situation today can only reply, of course.

Hearing at Morrisville SUNY on Farm Labor

Thank you for the opportunity to present some objective observations from my position as the Executive Director of NYS Horticultural Society during the last ten years. For 40 years earlier I was the owner operator of Baker Farms in Niagara County. This was a fruit and vegetable fresh operation. My observations then come from two different perspectives. I have real world farm “boots on the ground” and organizational experiences.

I applaud the efforts to have multiple hearings so that every side of this discussion may be uncovered.

Paul Baker,
Executive Director
NYSHS

In my opinion, the Senate and Assembly bills we are here to discuss have long lasting implications for all of New York State agriculture and the entire up state economy. In short we need to get this right!

To begin, I am certain that everyone here has the most sincere intentions to make certain all farm workers are given every protection under the law. Farming is different from almost any other occupation. It requires total dedication to your craft. Traditional norms often do not apply. Societies have attempted and failed, such as in the Communist models, to remove the farm from the owner. In my opinion, farming is in many ways similar to being a parent.  Just as when your child has a need, you address it with no regards to time. When a crop needs to be harvested or a herd needs to be milked it has to be addressed. Farming seldom can be slotted in an 8 hour or 40 hour time slot.

When you select agriculture as your career path you accept certain realities. Just as one accepts if you are a doctor you cannot dictate when your expectant mother will deliver her child.

Agriculture, unlike public government is dependent on producing products that will meet public demand. Each farm must produce and market within the economics of the supply and demand chains. Unlike State Government that can dictate annual increases in minimum wage. Agriculture pricing is a product of world and national supplies. Buyers will seek the highest quality for the lowest price. Always have and always will. Our grocery stores will never be void of the highest quality produce and food products. The sad truth is that if New York fails to produce one gallon of milk or one bushel of apples our local shelves will remain 100% stocked.

It is this reality that brings me to my question for this body. What is the desired end best result from this legislation? It will not serve any farm worker if we create legislation that does not allow agriculture to remain competitive in this food marketing supply chain.  If farms cannot meet payrolls they will be forced to close or dramatically alter their product choices. They will be forced to downsize, move away from labor intensive agriculture or close. In each of these examples it does not offer greater opportunities for farm employees.

We have the opportunity to calmly explore numerous options beyond the current language in the  Senate and Assembly bills. I honestly feel that the final wording of these Bills can be drafted that will allow NYS Agriculture to remain a leader in production. It also can find ways to mutually protect both the employer and employee from unfair labor practices. No one wins if the final legislation is not forward thinking in ways to see Agriculture continue in New York State.

I am encouraged that we are having these hearings. I pray for cool heads. I know that farm workers are some of the hardest and most talented workers. All of New York Agriculture is united in finding ways to protect and reward farm employees. To use an old saying we must be very careful in drafting this legislation so that we do not “throw the baby out with the bath water!”

Thank you for the opportunity to address this hearing.

 

 

Hearing on Senate Bill 2837 Suffolk County Legislature April 26, 2019

Mindset of Agriculture Today While we Await the Outcome of Senate 2837

Paul Baker,
Executive Director
NYSHS

I thought it might help to hear what is on the minds of Agriculture in New York today. As the Director of 3 farm boards, I receive, on a daily basis, calls from farms asking me to project the outcome of this legislation. Nature does not allow these farms to set everything on the back burner and await the final outcome. They must make real world decisions today that may or may not really be in their best interest depending on this piece of legislation. Here are a few of those decisions/questions;

  • Should I put my farm up for sale today before this Bill becomes a reality? There is little question that land values will take a dip if this Bill passes.  I know of large farms that have in fact sold or have placed their farms up for sale before land values fall.
  • What about investing in new land, equipment, storages, employee housing both new and improved are just a few of the questions that are on hold.
  • Should I return my seed/trees for a credit or plant it? I am unsure if I will be able to afford the labor cost later this year.
  • I actually have dairy farms that are slaughtering new calves because they cannot afford to feed them under current economics. Just meeting current bills is an impossible task. If this Bill passes as currently drafted they see no path forward.
  • Estate planning? How do we plan for tomorrow not knowing if we can survive the future costs here in New York? Young farmers are looking to other careers.
  • How do I craft contracts for 2019 if I cannot project my labor costs?
  • Time to lock in on seasonal recruitment of my labor for 2019. Can I sign a work order if I do not know the terms for myself or my employees? H2A agreements need to be crafted and advertised. If I limit my men to 40 hours will I be able to attract my experienced labor to my farm?

Most every farm at this date is locked into the 2019 crop. They are very uncertain as to the rules of employment and what this will mean for their operations. Nature will not wait. Crops need to be set in a timely basis to meet harvest before the frost of winter arrives. Overhead dictates farms must move forward. The costs of not doing so would be equally damaging.

I understand that we need to ensure that every employee is protected under the rules of fair labor. I see this discussion having huge long term effects on the state economy.  We are in the midst of annual minimum wage increases here in New York.  Due to the chronic lack of New Yorkers who will work on farms we must recruit from outside our state borders and often from outside our national borders. In order to manage our farms the reality is we must attract workers to our State. Farms, out of necessity, are using the federal program H2a.

Farms this year will have no choice but to accept the final language of this legislation for crop year 2019. The real impact will come as soon as crop year 2020. Once the true cost of labor is known, farms will drastically shift into new farming practices. If they see that they cannot pass on the new labor costs they will lose their markets. Traditional crops will have to be reassessed as to their feasibility. In short, agriculture will have no choice but to take on a whole new look. Only time will tell if this look is good for both farms and their employees.

 

Farm Worker Hearings Schedule is Now Set

We now have confirmation that the New York State Horticulture Society will be on the short list to offer oral presentation at the Farm Worker Hearings. The list of hearings will be as follows;

April 25, 2019             SUNY Morrisville, NY

April 26, 2019             Suffolk County Legislature, Smithtown, NY

May 2, 2019                SUNY Sullivan, NY

We will submit a written report. Second, we will then give an oral report on our concerns. This will offer a

Paul Baker,
Executive Director
NYSHS

Q &A. The plan is to offer equal presentations offering balanced time for each side of the debate.

In preparation for these three hearings, I encourage you to submit your own version of how you see this Bill impacting your operation should it move from Bill to Law. Also attempt to offer examples of what has happened when you have tried to curtail hours on your farm. Please send these ideas to our office. I will be offering 3 reports. I wish to offer 3 separate reports that will help report your views. It is very important you participate in this process. Either email or call me to offer your opinions.

I can be reached at the following:

Paul Baker

716-807-6827 (cell)

pbaker.hort@roadrunner.com

or

NYSHS@hotmail.com

 

 

 

So, What is Happening as Far as Overtime?

The wheels of Democracy are moving. Exactly where they will stop is the question. As a grower you must be filled with more questions than answers on this legislative activity. I will try to bring you up to speed. I must tell you that at this time it is totally up in the air as to which way it will end.

To begin, we have two basically identical bills in play. Senate Bill 2877 sponsored by Senator Ramos from the Queens. She is a freshman Democrat. The key issues to her bill are the following; Overtime after 8 hours each day and overtime after 40 hours in a week; Collective bargaining; Mandatory day of rest each week. The Assembly has a very similar Bill 2750 carried by Assemblywoman Nolan, Democrat, from Queens. In the next couple months the plan is to have several hearings across the State to review and discuss these bills. At this time the specifics of when and where these events will take place are not set.

In an effort to be objective I think the authors of these bills most likely have good intensions. The issue is they have very incomplete information from which to draw their conclusions. It is our intention that we will be able to bring both sides to a clear understanding of the facts. I will tell you it is currently very difficult as there has been very little effort thus far to understand the conditions on a modern farm in New York State by the two authors of these Bills.

According to a 2019 report from Farm Credit East, mandatory overtime would increase labor costs on farms by almost $300 million and decrease net farm income by almost 25%. Net farm income is down 50% from a few years ago and farmers have little to no control over the prices they receive for the products they offer for market.

Farm workers have repeatedly stressed to farmers that the number of hours available to work weigh

Paul Baker,
Executive Director
NYSHS

heavily in their decision to work on a particular farm.  If a farm must reduce hours to fall under the overtime threshold, it would most likely force existing workers to look elsewhere for a job making a tight labor market even more stressed.

Collective bargaining has long been a grave concern for farms. The reality is that this is not such a threat so long as we can have a “No Strike” clause added. Currently there is none in either Bill. The mandatory day of rest needs to be amended to read “voluntary” day of rest. During peak harvest times neither farmers nor farm workers wish to be forced to sit.

What can you do? As the announcements become known, you need to voice your individual story as to how this Bill would impact your farm. If possible, have your employees offer their voice as to how they feel about the impact of this Bill on their lives. If you can take the time to offer testimony, do so. If not, submit written accounts of this Bill on your future. If the opportunity presents itself, be present to show solidarity to this issue. I cannot stress enough the best time to deal with a Bill is before it gets passed and signed into law. We need to stop or dramatically force changes to this Bill in the Senate and Assembly. Once it passes both chambers most feel there is little doubt the Governor will sign it.

Everyone wishes we were not faced with this challenge. The 8 hour per day and 40 hour per week version will, if passed, dramatically alter New York agriculture. We simply will not be able to meet national prices. As much as you may not like it, some form of overtime will very likely be in play. We need to get these numbers at a level we can still hire labor and remain competitive in the market place.

The details of this bill will have enormous implications on New York State agriculture and the up-state economy. It will serve no one to complain later if we do not make every effort to meet the challenges of this bill head on.

Overtime?

I think it is time we take a look at OVERTIME. We hear so much about what a great opportunity it can be for employees. Likewise, we hear almost every employer held in fear of what it will do to their profitability. So, as in most things, the truth lies somewhere in the middle.

In modern times, overtime became a tool during FDR. The nation was struggling to survive in a world depression. The bread lines were enormous. People were desperate to find any work. No one was demanding to receive overtime. So why would FDR impose overtime on employers who were struggling to survive. The President saw that he needed to somehow get more people to have a job. He felt that if he imposed time and half after 40 hours he would encourage employers to look to employ new faces to fill those hours at the initial pay rate. In short, he was not trying to giv

Paul Baker,
Executive Director
NYSHS

e employees a benefit for working longer. Rather he was trying to get new faces off the breadlines.

Today most all hourly workers have overtime in their portfolio. My question is, what does it really do for them but limit their ability to earn beyond 40 hours? I realize I grew up on a farm. We did not ever discuss our hours or overtime. I also recall being the sole provider for my young family. I was very grateful that I was not limited to 40 hours. It would have dramatically reduced my income potential. So my question for legislators that are concerned about helping the life of hourly employees, is overtime hurting or helping? Thinking outside of the box I could argue that legislators could make the case that they should increase the overtime cap from 40 to 50. This would make it much easier for those workers to support their families if they could simply remain on their primary job longer. To find a second job is very difficult and almost always for a lower hourly wage. I know this is not a current idea but I challenge people to find the flaw in what I am asking.

Agriculture is different. This is a subject that I feel needs to be discussed but on a national stage. My challenge is that before we attack the system in agriculture we take a long creative look at how we might make New York a much better place to work and raise a family. This move alone would encourage new growth in business and attract business to New York State. That would really be a refreshing change.

 

Senate Bill 2837 and Assembly Bill 2750

Here are some considerations for talking points.

  • A fact that no one wishes to address is in this case everyone is trying to improve the future for farm workers. While it may, on first glance, seem this is false, it is very true. Those of us in the industry know what will happen to the income opportunity for this group if this Bill passes. While good intentions are involved, it will harm the very people it wishes to help.
  • Overtime almost always limits the income potential for workers. While it is intended to reward the good employee, it most often limits the employee’s income potential. The end result is the employee is left with fewer dollars.
  • The reality is that farm employees represent a very specific skill set. Just because you increase a perk
    Paul Baker,
    Executive Director
    NYSHS

    such as overtime does not mean you will suddenly have new employees with the necessary skill set. There are only 700 players in the world with enough skill to play major league baseball. If you increase the pay there will still only be 700 players with such skills. Farm employees are in such a skill set. Supply and demand should set their income value. It has in the past and no doubt it will in the future. But it needs to be noted that to simply increase over time we will not see a new wave of citizens capable or willing to be a farm employee. Farm wages are above most retail today and yet we need to import our employees because domestic workers do not have the skill or desire to fill these jobs.

  • Our fear is if this bill, as drafted, is passed it will force farms to dramatically shift their product mix away from labor to mechanized crops. This would be such a culture shift it would be impossible to reverse. End result would be that not only farm employees but NYS employees working in milk plants, processing plants and other crop related tasks jobs would be gone.
  • NYS is an import state for farm employees. As previously noted, these employees are in short supply. They will have other opportunities to work in other states that will allow them to have the hours they desire for the time they are willing to sacrifice to be away from their homes. In short then we may very well be faced with a very high level of unfilled jobs.

February Reality Check

I just spent two full days taking two groups around Albany. The first day they were from the Berry Industry. On the second day, they were primarily apple growers, but they had other tree fruit interests. Each group had budget items to discuss. At every one of my 30 visits we closed with a Q and A about the possibility of new legislative action on the Farm Omnibus issues. Of all the possible issues, the possibility of overtime at any level but most of all 40 hours looms high.

I am not here to cast any negatives on any sector of our industry. The reality is this as I see it. Dairy is locked in a struggle to cover overhead while they continue to out produce demand. They have no legal right to hire foreign workers like the H2A. Overnight, fruit is seeing that its traditional top four varieties are now listed in the back of their consumer’s demand. The rapid decline of demand for Macs, Cortland, Empire and Red Delicious are leaving producers with over 50% of their acreage in a less desirable demand position. Dairy and fruit are the top two categories in New York. I need not list the issues that are present in the remaining crops. Are they important? Cornell studies say apples account for 1.2 billion dollars annually. Regardless of misconceptions by too many New Yorkers, agriculture is a major economic driver we cannot afford to lose.

One quick takeaway that I think is important to mention here. In both Albany and DC we see a huge

Paul Baker,
Executive Director
NYSHS

changing of senior leadership. Albany and DC are having to adjust to a large percentage of new legislators. They are loud and they intend to quickly make their mark. Educating these new legislators is a very new challenge. They arrive, in most instances, with strong convictions. Often times their sources of information are based on perceptions from social media verses facts. So we must defuse these already strong perceptions before we can to move ahead in any discussions.

Here are two examples of what we are facing. In the Senate Veteran Committee there are only two members with any military experience. In the Assembly Agriculture Committee similarly there are only two members with any real agriculture experience. We are seeing committees making policy for us all that have no real world understanding of their respective topics. I have echoed this to you all before. If you decide to not speak, many will fill your absence that have no understanding of your world.

Regardless of what you might think you have heard or hoped for this issue will appear shortly after they complete the arduous budget debates in early April. Perception becomes reality. If you have ever been to either the legislative chambers in Albany or DC you must first pass inspection for security reasons. Trust me when I tell you the ‘weapons of misconceptions’ that are sneaking threw are very dangerous. We must make every effort to continue to be in discussions prior to these legislative floor hearings. I believe, for the most, part people wish the best for each other. Too often however we all may rush to judgment before we truly comprehend the entire topic. We have time between now and the end of this legislative session. I urge you to get involved. It is nearly impossible to get rid of bad legislation. It is often time best served to head it off before it becomes reality.

What is at Stake in the next Year in Albany?

No one has a lock on tomorrow. We each can offer our most sincere educated estimate about the future. We must try to stay within our known borders and then project what could possibly happen. With total 100% certainty the political climate in Albany in 2019 will be changed. We know for certain that all three chambers now rest comfortably within one party. This makes passage of party programs significantly easier to obtain. Based upon the history of the last decade, it is safe to assume new legislation will be offered up that will significantly impact our industry. The question yet to be decided will be whether we can withstand these revolutionary changes?

The most obvious issue that will be facing NYS agriculture will it be mandated, like all other segments of labor, to pay employees on a 40-hour work week and pay time and a half? Collective bargaining is also of concern. For today let us simply look at time and a half on a commercial fruit farm. To do this we will make a few assumptions. We will assume that for this farm to maintain a credible work force that they are in the H2A program. Last year the adverse effect wage rate was $12.83.  We do not know the new one but it most likely will be in the range of $13 plus.  For today I will use last year’s rate. For my calculations I am going to say harvest was 10 weeks. I am going

Paul Baker,
Executive Director
NYSHS

to say the farm employed 50 workers. The average work week in harvest was 60 hours. In 2018 then that farm had a weekly hourly outlay just for harvest wages of $38,490. (60 hours X $12.83= $769.80 per employee. Now X 50 employees = $38,490 per week). This, of course, does not consider State unemployment and workers comp related costs. If we now do the same exercise at time and a half for this same farm, we see his direct costs rise to $2 shy of $900 per man per week. So, his new payroll will be up (40 hours X $12.83= $513.20 plus 20 hours at $19.25= $385). So, the new weekly pay check will be then $898.20. Same crew and not one extra bushel harvested. This farm will then have a weekly payroll of harvest employees alone of $44,910 plus other employment charges (50 employees X $898.20= $44.910).

For our simple example, Fruit Farm X has an increase of $6,420 per week ($44,910 – $38,490 = $6420). Now over 10 weeks we see an increase to harvest employees alone of $64,200. Same production.

The NYS minimum wage in 2019 is $11.10. This is $3.85 above the federal minimum wage. If you are in H2A you are paying $5.58 above the federal minimum wage. Farm wages are not by any means the lowest in the land. They greatly exceed the average small business sectors up and down main street. We need to make this point. Each farm employee creates multiple off farm jobs in NYS. Clearly NYS fruit farms cannot remain competitive if they must absorb these new estimated charges. A compromise must be reached, or we will see NYS forever altered. I remind everyone of the stark reality that once a farm operation closes its doors it never returns. Are we ready to see this radicle change in our State? Now is the time for everyone to get concerned. Currently, we have not seen the legislation we did our math homework on in this State. Today is not too late to begin a very serious debate.

I am asking each of you to rethink all the issues. As farmers, we are not immune to annual changes in weather, technology and markets. It comes as no surprise to anyone that labor availability is tied to higher wages. Agriculture in NYS is tied to a very high usage of labor. We are not an Iowa corn-based economy. As the new year arrives each of you need to educate yourself on all levels. Take advantage of educational programs such as the Becker Forum coming in January 2019. Reach out to your respective NYS legislators and have a discussion with them as to what is at stake. Support the efforts of your respective organizations that are presenting logical debates to many of these proposals.  If you fail to speak, I assure you this void will be filled by voices that have no real skin in the game. Action will occur. I encourage you to be a part of it.