WATERTOWN, N.Y. (WWNY) - We asked Jefferson County Agricultural Coordinator Jay Matteson how much mandatory overtime pay is expected to cost farmers and he says it could be a double digit increase in labor costs.
“It would be a 20 percent increase, just this, just this mandatory overtime - a 20 percent increase in his labor cost. Well, how do you deal with that?”
Matteson says that’s what Devon Shelmidine is estimating mandatory overtime will cost his 1,000-cow dairy farm in the town of Adams.
The farm workers bill, which Governor Cuomo signed on Wednesday, requires farmers pay employees time and a half after working 60 hours a week, among other protections.
“They will finally, finally have the same protections that other workers have had for 80 years. Unemployment and disability insurance, workers compensation, over-time pay, paid family leave,” said Cuomo.
While Matteson says Shelmidine believes it will be a 20 percent increase, a study done by Farm Credit East in February estimated overtime pay would increase labor costs by 17.2 percent for farms. However, that was based on a 40 hour work week which was originally proposed in the bill.
Matteson says the new law will especially hurt dairy farmers like the Murrays at their 1,200 cow dairy farm near Copenhagen that employs 17 people.
Our milk price is set so we get that price and it doesn’t matter what our costs are. We have to find a way to keep our cost under that so we can stay in business. So we don’t have the luxury of being able to pass it on to the consumer," said Peggy Murray of Murcrest Farms.
Murray says they may have to hire part-time workers during the cropping season so employees don't work overtime. Matteson says he's heard from other farmers that said they may do the same or he says they'll reduce benefits like health insurance, or invest in technology like robotic milkers to do farm workers' jobs.
Matteson says he thinks there will be farms that ultimately close their doors because of this.
“There are already farms that are on that threshold because of the difficulty in dairy prices over the past 4 years,” he said.
The bill takes effect January 1 of next year.
Matteson says this new law, coupled with the state’s increasing minimum wage, are creating a tough business climate for farmers. He says he knows of two local farms that are looking seriously at selling their farms and moving their businesses out of state.