Farm Horizons, October 2014

Changes in Minnesota minimum wage laws and what it means for agriculture

By Jennifer Kotila

As of Aug. 1, minimum wage laws in the state of Minnesota changed for all employers, including those in agriculture. Employers considered in the business of agriculture are those who participate in farming and all its branches, including dairying, field production, cultivation, and growing and harvesting agricultural or horticultural commodities, according to the Minnesota Department of Labor and Industry.

Agricultural employers also include those raising livestock, bees, fur-bearing animals, and poultry; those involved in cleaning, processing, preserving, loading, and transporting to market or storage farmers’ agricultural products; and repair, maintenance, and construction work connected to or incidental to agricultural operations.

Agricultural employers are required to pay the federal minimum wage of $7.25 per hour, or the state minimum wage, whichever is higher – unless certain exemptions are met. Before Aug. 1, the federal minimum wage $7.25 per hour was higher than the state minimum wage of $6.15 per hour, so employers were required to pay that unless the employee fell under one of several exemptions.

Employers exempt from federal minimum wage laws include those that did not use more than 500 “man days” of agricultural labor in any calendar quarter of the preceding calendar-year, or they did not gross at least $500,000 in the past year.

Other agriculture employees exempt from the federal minimum wage law include immediate family members of the employer; those principally engaged on the range in the production of livestock; local hand-harvest laborers who commute daily from their permanent residence, are paid on a piece-rate basis in traditionally piece-rated occupations, and are engaged in agriculture less than 13 weeks during the preceding calendar-year; and non-local minors, 16 years of age or younger, who are hand-harvesters, paid on a piece-rate basis in traditionally piece-rated occupations, employed on the same farm as their parent, and paid the same piece-rate as those older than 16.

Although an agricultural worker may be exempt from federal minimum wage laws, an employer must pay the Minnesota minimum wage. Before Aug. 1, large agricultural employers (those that gross more than $500,000 in business revenue yearly) were required to pay a minimum wage of $6.15 per hour; after the new law went into effect, large agricultural employers must pay employees a minimum wage of $8 per hour. This minimum wage will raise to $9 per hour Aug. 1, 2015, and $9.50 per hour Aug. 1, 2016.

Because the new minimum wage in Minnesota is higher than the federal minimum wage, employers must now pay that to their employees – even those employees who are exempt from the federal minimum wage law.

Small agricultural employers are now required to pay a minimum wage of $6.50 per hour, up from $5.25 before Aug. 1. This minimum wage will raise to $7.25 per hour Aug. 1, 2015, and $7.75 per hour Aug. 1, 2016.

Before Aug. 1, agricultural employers could pay employees younger than 20 years old a smaller minimum hourly wage of $4.90 per hour during a 90-day training period. This is no longer the case, and agricultural employers are required to pay the minimum wage.

Overtime pay for agricultural workers

Agricultural employees who are paid in any means other than a “salary” are entitled to overtime pay at a rate of time and a half for all hours worked in excess of 48 hours per week, according to Minnesota law. Agricultural workers are exempt from overtime provisions of the federal Fair Labor Standards Act, but federal law does not supersede Minnesota law, according to the MN Department of Labor and Industry.

Agricultural employees in Minnesota are exempt from the state overtime pay requirements if they are paid a certain minimum salary. Before Aug. 1, that minimum salary was $452.03 per week for large employers. Now the minimum salary is $588 per week, and raises to $661.50 per week Aug. 1, 2015, and $698.25 per week Aug. 1, 2016.

For small agricultural employers, the minimum salary was $358.88 per week. It is now $477.75 per week. This will go up to $532.88 per week Aug. 1, 2015, and $569.63 Aug. 1, 2016.

Laws regarding migrant workers’ pay

A migrant worker must be provided a written statement upon recruitment that state the following facts:

• the date the statement was completed;

• the name and permanent address of the worker, employers, or recruiter of the migrant worker;

• the arrival date of the migrant worker;

• the crops and the operation where the worker will be employed;

• the wage rates, the payment terms, and any deductions to be made from wages; and

• whether housing will be provided.

Employers must provide health insurance for recruited migrant workers if employing five or more people during the period of employment. Employers are also required to pay the workers at least every two weeks, unless terminated, when the employer must pay within three days. Finally, employers must guarantee migrant workers at least 70 hours pay for work in two successive weeks.

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