Will new minimum wage affect farms?

SALEM, Ohio – Ohio’s minimum wage took a step up Jan. 1, but the move wasn’t as simple as a one-time, across-the-board pay hike. The new law means changes for Ohio’s workforce and it’s raised a lot of questions on both sides of the paycheck.
A rumor has circulated that farmers are exempt from the new minimum wage requirement, but that’s simply not true, according to the Ohio Farm Bureau.
Just like other employers, the majority of farmers in the Buckeye State are required to pay the new state minimum wage of $6.85 per hour. There are, however, some exceptions for small farms and businesses with few workers.
Exemptions. House Bill 690 exempts all businesses with annual gross receipts of $250,000 or less and employees under 16. In these cases, businesses can pay the federal minimum wage, or $5.15 per hour.
Also, the law doesn’t apply to family members employed by solely family owned and operated businesses.
Exemptions specific to agriculture include employers who didn’t use more than 500 man days of ag labor during any quarter of the preceding calendar year and farms that employ members of the owner’s immediate family.
Those employed as a hand harvest laborers and paid on a piece-rate basis and those who have worked in agriculture less than 13 weeks during the last calendar year are exempt as well.
The bill also exempts employees working in the aquaculture industry.
What it means. Despite the exemptions, one industry expert expects to see most farm help making at least $6.85 per hour.
“I still believe most farmers are going to be paying minimum wage or better,” said John Wargowsky, director of labor services and policy at the Ohio Farm Bureau.
Wargowsky didn’t have solid numbers on the salary of farm employees, but he said many farmers are already exceeding the wage the law requires.
“I know a number of people are already paying better than minimum wage,” he said.
For those who aren’t, Wargowsky said it’s time to take a hard look at the books.
“What people are going to have to do is look at their budgets and make adjustments,” he said.
Records. Besides raising the minimum wage, the bill also includes record keeping and other compliance issues. For instance, when a person is hired, employers must provide their name, address, telephone number and other contact information to the new employee.
Employers also have to maintain a record of the name, address, occupation, pay rate, hours worked each day and each amount paid to an employee. These records have to be kept at least three years from an employee’s last day of work. However, a provision in the bill exempts agricultural employers from recording the hours worked each day.
Employers are also required to give payroll information to employees or their representatives. Employee privacy is protected through provisions in the bill that specify who can ask for this information and what is provided.
The bill also has a section prohibiting employers from punishing employees who ask for any of the above information.
Inflation. Besides wages and record keeping, the new law takes inflation into consideration and each Jan. 1 the wage rate will be increased according to the Consumer Price Index.
Wargowsky cautions that employers whose pay rates are at or near minimum wage will need to keep a close eye on this matter from year to year in order to keep up with changing rates. Plus, employers that pay by piece rate will want to make sure their wages are competitive with the increased minimum wage to give employees the proper incentive, Wargowsky said.
(Reporter Janelle Skrinjar welcomes feedback by phone at 800-837-3419, ext. 22, or by e-mail at jskrinjar@farmanddairy.com.)