Rule Coordinator Division of Labor Standards and ......Iowa, Minnesota, Montana, Nebraska, Nevada, New Mexico, North Dakota, Oregon, South Dakota, Texas, Utah, Washington, and Wyoming

November 4, 2019 Mr. Michael Primo Rule Coordinator Division of Labor Standards and Statistics Colorado Department of Labor and Employment 251 E 12th Ave. Denver, CO 80203 RE: Comments regarding proposed revisions to Colorado Minimum Wage Order 35 Dear Mr. Primo, On behalf of the Colorado Agriculture Council (www.coloradoagcouncil.net), and its more than twenty member organizations, please accept the following comments regarding possible revisions to Colorado’s Minimum Wage Order (MWO) 35. The Colorado Ag Council pulls together organizations from across the state that represent and serve Colorado's farmers, ranchers, and other agricultural producers. The Ag Council acts as a forum for discussion and review of issues that affect Colorado's many agricultural industries. The Council therefore appreciates this opportunity to express concern over potential changes in the regulation of farm labor. In addition to acting as a forum, the Ag Council also advocates for our rural communities, including sponsoring the Colorado Ag Water Alliance (CAWA), organizing and hosting National Agriculture Week activities at the State Capitol, and providing annual financial and in-kind support for food banks and the nonprofit organizations that operate them across the state. Colorado Ag Council members include: Colorado Aquaculture Association

Colorado Association of Conservation Districts

2

Colorado Association of Wheat Growers Colorado Cattlemen’s Association Colorado CattleWomen, Inc. Colorado Corn Growers Association Colorado Dairy Farmers PAT/PAC Colorado Egg Producers Association Colorado Farm Bureau Colorado Fruit and Vegetable Growers Association Colorado Horse Council Colorado Independent CattleGrowers Association Colorado Livestock Association Colorado Onion Association Colorado Pork Producers Council Colorado State Grange Colorado Sugarbeet Growers Colorado Wool Growers Association GreenCO of Colorado National Young Farmers Coalition Rocky Ford Growers Association Rocky Mountain Agribusiness Association Rocky Mountain Farmers Union

As you know, agriculture is not among the industries to which the state’s MWO applies. For the reasons we outline below, we would encourage the Department to maintain the existing exemption and not to expand the MWO to include Colorado's farms and ranches. About Colorado agriculture The 2019 Colorado Business Economic Outlook paints a somber picture for Colorado’s agriculture industry. The report notes that agriculture producers are “weathering a storm of low commodity prices, trade uncertainties, and unfavorable economic conditions.” The report further states:

• While Colorado’s economy is one of the fastest-growing in the nation, increased prices for feed, fertilizer, fuel, and labor, as well as higher interest rates, are taking a big bite of farm profits. With higher margins, industries such as construction and oil and gas are able to pay higher salaries and absorb these inflating costs, while farmers struggle with the increases.

• It is projected that Colorado’s 2018 farm and ranch income will be the lowest since

2002, with totals expected to slip from $900.6 million in 2017 to $690 million in 2018, ticking up to $706 million in 2019.

3

• Colorado’s farm income is expected to decline more than the national figure, with a drop of 23% in 2018, and a slight strengthening in 2019. The USDA projects a 19.9% decline in national farm income in 2018.

• Colorado’s farm income is closely tied to livestock, so a decline in cattle income has a greater effect for the state.

• As innovation and technology drive profits in other industries, the economies of scale created by the use of these technologies on the farm may have the opposite impact on agriculture. Farmers grow more crops on less land, using less water and fertilizer, but find themselves in a market of abundance that drives commodity prices down, and have to produce more just to stay afloat. Smaller operations go out of business when they do not have the equity to survive market swings, leading to more consolidation and the perception of “large corporate farms.”

Business Research Division, Leeds School of Business, University of Colorado Boulder, Colorado Business Economic Outlook 2019, pp. 20-24 (available at https://www.colorado.edu/business/sites/default/files/attached-files/2019_colorado_business_economic_outlook_011719.pdf); see also U.S. Department of Agriculture, National Agricultural Statistics Service, 2018 State Overview for Colorado (available at https://www.nass.usda.gov/Quick_Stats/Ag_Overview/stateOverview.php?state=COLORADO) (estimating approximately 38,900 farm operations covering 31.8 million acres in the state). Today, Colorado is home to more than 13,000 beef cattle producers, 206 feedlots, and 24 facilities certified by the USDA to harvest livestock. Colorado’s beef sector drives Colorado’s agricultural economy. Beef and cattle account for nearly 67% of the total value of agriculture production and nearly $3.4 billion in cash receipts. Ranchers are selling a higher volume of cattle but at lower prices, with a season average of $116 per 100 pounds (cwt) projected for 2018 versus $117.50/cwt for 2017 and the high of $153/cwt in 2014. Colorado is the fourth largest exporter of fresh and frozen beef in the United States, exporting over $1 billion annually of fresh and frozen beef. In 2018, Colorado ranked 10th in the nation in total cattle. Colorado’s feedlots feed almost 2 million head of cattle per year, including cattle from other states. First of January 2019 cattle inventory (Colorado): Cattle, beef cows – 797,000 Cattle, including calves – 2,850,000 Cattle, on feed – 1,050,000 Recent changes in U.S. trade policy have affected the U.S. hog market as a whole. China has recently been buying pork from other countries and U.S. exports to Mexico have decreased.

4

U.S. exports are not growing as quickly as domestic production. And while the tonnage of pork exports is up, the value of exports is down. First of December 2018 hog inventory (Colorado): All hogs – 750,000 Colorado is the largest lamb feeding state in the nation, is ranked 3rd highest for all sheep and lambs in the U.S., and ranked 4th in wool production. Colorado Lamb Processors, LLC is on track for opening a new harvesting facility for lamb in January 2020. This is currently the largest infrastructure project in the United States to benefit the American Lamb industry. There has not been a new harvest facility built in the western United States for over 30 years. Historically, Colorado feedlots have fed lambs from Arizona, California, Colorado, Kansas, Idaho, Iowa, Minnesota, Montana, Nebraska, Nevada, New Mexico, North Dakota, Oregon, South Dakota, Texas, Utah, Washington, and Wyoming. The largest sheep producers in Colorado are located in western Colorado, in remote regions of the state dotted with small, rural towns and abundant space. Successful sheep production in western Colorado relies heavily upon federal grazing. Raising sheep is an expansive enterprise, rotating sheep from high mountain pastures in the summer to lower elevations for winter feeding. It is this rotational grazing that is key to the production of Colorado lamb and wool. Sheep production in Colorado generates $63.30 million in direct sheep production output (the direct effect) such as lamb, wool, pelt, and breeding stock sales. The Colorado sheep industry is also an important contributor to rural employment. There are 1,731 sheep operations in Colorado that employ 2,298 workers. Feeder lamb prices were expected to be lower in 2018 partly due to higher imports. Additionally, at the end of July 2018 the United States had a full quarter’s worth of lamb and mutton in cold storage waiting to be sold, which also put downward pressure on prices. First of January 2019 sheep inventory (Colorado): All sheep, including lambs – 420,000 Colorado has approximately 120 dairy farms, with an average herd size of 1,467 milking cows. Colorado ranks 15th in the nation in the number of milk cows, 14th in the nation for milk production and 2nd in the nation in milk output per cow. Colorado dairy farms create more than 14,000 jobs that are directly supported by the dairy industry and another 600 jobs that have been created by dairy exports. In 2018, the cost of a Colorado dairy cow was about $1,382. The average value of the milk a Colorado dairy cow produces in one day is about $10.53.

5

US dairy products are exported all over the world, including Mexico, Southeast Asia, Canada, China and Japan. While exports to Mexico account for 70% of Colorado’s dairy exports, at one point in time in 2018, exports to Mexico were off 30% for the year. Colorado’s dairy cash receipts were estimated to grow from $754 million in 2017 to $765 million in 2018 and to a projected $775 million in 2019. First of January 2019 dairy cattle inventory (Colorado): Cattle, milk cows – 178,000 Wheat and corn are Colorado’s primary grain crops. The value of Colorado’s wheat crop was expected to be down in 2018 to $319 million from $320 million in 2017. 2019’s wheat crop is projected to rise to $366 million. Colorado was ranked 7th in the nation for wheat production in 2017, with nearly two million acres in production, producing about 86 million bushels of winter wheat. A farmer’s share of a one-pound loaf of bread is just 6 cents. Colorado exports 40% - 60% of the wheat produced in the state. Following China placing a 25% retaliatory tariff against the United States, China had not purchased any new shipments of wheat from the U.S. since May of 2018. In marketing year 2016-17, China was the fourth-largest export destination for U.S. wheat. It dropped to eighth in 2017-18. Colorado’s field corn crop is consumed almost entirely within the state by the dairy, feedlot, and ethanol industries. While Colorado does not export much corn, tariffs on U.S. exports of corn and soybeans to China have an effect on the entire U.S. commodity market, bringing the price of corn down for all farmers. Much of Colorado farmland is in dry-land production, meaning farmers do not have the ability to irrigate, thus Colorado’s grain farmers do not have many choices when it comes to the crops they raise. Most land where irrigation is available is in corn production (or specialty crops) because it is more profitable than wheat and dryland corn crops produce significantly less yield than irrigated corn. While many farmers often rotate crops for a number of reasons, they simply cannot switch from growing wheat to potatoes to alfalfa. Equipment, labor, seed, fertilizer, water, and field preparation must all be taken into account. Potatoes are Colorado’s main crop in the fruit and vegetable marketplace, with most potato production occurring in the San Luis Valley where farmers continue to be challenged by a lack of water for irrigation. Colorado is ranked fifth in the nation for potato production, producing over two billion pounds of potatoes annually.

6

In 2018, cash receipts for potatoes were estimated to be down 5% from 2017 and are projected to be down another 5% in 2019. Mexico is Colorado’s largest export market for fresh potatoes. In 2018 there were 55,300 acres in Colorado planted with potatoes. Colorado’s fruit industry continues to experience modest annual growth, boosted by brands like Palisade Peaches, Rocky Ford Melons, Olathe Sweet Corn, and Pueblo Chiles that are well known to consumers. Colorado farmers also produce other specialty crops including onions, tomatoes, lettuce and cabbage. Similar to other industry sectors, labor issues continue to challenge the fruit and vegetable industry. While growers hope for guest worker reform, they are forced to use the cumbersome and bureaucratic H-2A program to obtain the workers they need. The sod, nursery, and floriculture industry are estimated to continue to grow from $336 million in 2017 to $359 million in 2018 and a projected $384 million in 2019. This continued growth is buoyed by the state’s robust housing market as new homes include new trees, flowers, and landscaping. Other industry sectors, number of acres in Colorado planted in 2018: Hay and haylage – 85,000 Sorghum – 355,000 Millet/proso – 300,000 Barley – 60,000 Sunflower – 66,000 Sugarbeets – 26,300 Farm labor workforce The composition of the agricultural workforce is evolving. Farmers and ranchers continually face worker shortages and struggle to fill critical job positions. Yet, the industry is doing its part to support its workforce. Recent U.S. Department of Agriculture (USDA) data shows that in recent years, farm wages are growing faster than non-farm compensation. The USDA Economic Research Service (ERS) reports that “employment in the agriculture industry has been in long-term decline as rising agricultural productivity due to mechanization has reduced the need for labor. The reduction in self-employed and family labor has been more rapid than the decline in hired labor. According to data from the National Agricultural Statistical Service’s (NASS) Farm Labor Survey (FLS), the number of self-employed and family farmworkers declined from 7.60 million in 1950 to 2.06 million in 2000, a 73-percent reduction. Over this period, average annual employment of hired farmworkers – including on-farm support personnel and those who work for farm labor contractors – declined from 2.33 million to 1.13 million, a 52-percent reduction. As a result, the proportion of hired workers has increased over time.” USDA ERS, Farm Labor (available at https://www.ers.usda.gov/topics/farm-economy/farm-labor/).

7

Moreover, while hired farmworkers make up less than 1 percent of all U.S. wage and salary workers, they play an essential role in U.S. agriculture. In 2016, according to data from USDA’s Agricultural Resource Management Survey (ARMS), hired farm worker wages and salaries represented roughly 14 percent of total cash expenses for all farms, and about 39 percent of expenses for farms specializing in labor-intensive fruit and vegetable and nursery production. The majority of hired farmworkers are hired directly by farmers, with the balance being employees of agricultural service companies, including farm labor contractors, custom harvest providers, and management service providers. The farm workforce is not homogenous. Demographic differences, for example, exist between crop and livestock workers. A larger share of workers in crops and related support industries are female (26 percent versus 20 percent in livestock). Crop workers are also less likely to be non-Hispanic whites (26 percent versus 59 percent for livestock), and less likely to be born in the United States (49 percent for all workers in crops and supports, and 36 percent for crop workers in manual labor occupations versus 69 percent for all livestock workers). Recently, the USDA reported that “over the past decade, the average age of hired farm laborers (excluding managers, supervisors, and other supporting occupations) has risen steadily, from age 35.8 years in 2006 to 38.8 years in 2017, an increase of 8 percent. This increase has been entirely driven by the aging of foreign-born farm laborers, who comprised between 54 and 58 percent of the workforce over this period. Their average age rose from 35.7 in 2006 to 41.6 in 2017, an increase of 16 percent. USDA ERS, Amber Waves, "U.S. Hired Farm Workforce is Aging" (May 1, 2019) (available at https://www.ers.usda.gov/amber-waves/2019/may/us-hired-farm-workforce-is-aging/ ). As recently reported online by the Farm Journal (https://www.agweb.com/article/dairy-report-dairy-demand-56-year-high-farm-wages-trending-higher) and based on a review of USDA data, between 2014 and 2018, the average hourly real wage (inflation adjusted to 2018 dollars) for nonsupervisory hired farm workers rose from $12/hour to $13.25, an increase of 10.4%. Nonfarm wages are still notably higher, growing from $21.90 in 2014 to $22.97 in 2018, but increased only 3.5% over the same period. USDA economists note that the rate of growth in farm wages from 2014 to 2018 is the fastest it has been during the past two decades. Reports from farmers themselves attribute the rapid growth in farm wages primarily to a shortage of immigrant workers, competition from off-farm jobs, and a reluctance, if not outright refusal, by non-immigrant workers to work on farms. See Taylor Leach, Farm Journal, "Dairy Report: Dairy Demand at 56-Year High, Farm Wages Trending Higher" (Sept. 25, 2019) (https://www.agweb.com/article/dairy-report-dairy-demand-56-year-high-farm-wages-trending-higher ). In March of this year, Cornell University published a report analyzing the agricultural workforce in New York. While there certainly are differences between New York and Colorado, the report provides some helpful data on farmworker expectations:

How Many Hours Do Farm Employees Work?

8

In their 2016 survey of Hispanic dairy employees in New York state, Maloney, Eiholzer and Ryan (2016) asked employees three questions about the hours they worked per week: 1) how much they actually worked, 2) how much they would like to work, and 3) the minimum hours they need to work in order to keep them from looking for another job. They found that employees “insisted on working at least 57 hours per week, are actually working 67.2 hours per week, and would like to work 67.6 hours per week.” Because the hours actually worked and hours they wanted were nearly identical, the researchers concluded that employees were already getting the number of hours they wanted. Work hours in highly seasonal agricultural sectors such as fruits and vegetables are a special situation. Because of the perishable nature of these crops and the variability of weather, farm work sometimes must be completed when the opportunity is available. Consider vine crops such as summer squash for example, these crops must be harvested 2 to 3 times a week when they are ready. Fruiting crops such as apples and grapes are ready at optimal times, when the weather is right, growers must harvest no matter how many hours of labor it takes. Harvests delayed by labor issues can result in reduced farm profitability, lower quality produce, or even loss of an entire crop. Even dairy farms that grow crops to feed their cattle must work long days when weather and crop schedules permit.

Richard Stup et al., "The State of the Agricultural Workforce in New York," pp. 13-14 (March 2019) (Cornell University, College of Agriculture & Life Sciences) (internal citations omitted) (available at https://dyson.cornell.edu/wp-content/uploads/sites/5/2019/03/Cornell-Dyson-eb1901.pdf ) (the "Stup Report").

The Stup Report also addresses the important role that housing often plays in farmworker compensation:

[A]lmost 40% of full-time farm employees received farm-provided housing as a benefit in the 2017 Farm Employee Compensation Benchmark. Farms that have grown over the years often own adjacent farms that include a house, and it is common for a farm employer to provide that house to a local employee as part of his or her compensation. It is also not uncommon for farm employers to assist their key local employees to finance and purchase a home of their own. Foreign born employees often require employer-provided housing because they do not own a home locally and they frequently have difficulty finding properties to rent. It is now also a customary and long-established practice for farms to provide housing as an employment benefit for their foreign-born employees. [A]mong Hispanic dairy farm employees 79% had housing fully provided by the farm, 8.8% shared the cost of housing with the farm, and 12.2% provided their own housing. The quality of farm-provided housing varies widely. There certainly have been incidents of poor quality, farm-provided housing situations that have

9

been reported in the popular press. Fortunately, this is not the norm, based on the author’s own experience visiting farm employee housing, much farm-provided housing is of similar quality to other rental properties and some is newly constructed or recently remodeled and of excellent quality.

Stup Report at p. 15 (internal citations omitted); see also Cornell University's Agricultural Workforce Development Program tools for managing farm-provided housing (available at: http://agworkforce.cals.cornell.edu/human-resource-management/worker-housing/ ); Mary Jo Dudley, Creating Positive Workplaces: A guidebook for dairy farm employers," pp. 87-96 (published by Cornell Farmworker Program) (available at: https://cardi.cals.cornell.edu/sites/cardi.cals.cornell.edu/files/shared/CreatingPositiveWorkplaces -AGuidebookforDairyProducers%20November%202017.pdf). As Stup points out, "[a]ttracting a steady supply of reliable and productive employees is one of the greatest challenges facing U.S. agriculture today." Stup Report at 16. This industry threatening problem can be traced to the combination of steady non-farm job growth and historically low unemployment rates that have led to exceptional competition for employees. At the same time, Mexicans and Central Americans are arriving in decreasing numbers owing to an improving Mexican economy coupled with barriers created by federal immigration policy. It also notable that non-immigrant workers are difficult, and, in some communities, impossible for farm employers to attract. Physical work and jobs that require specialized skill sets lead many non-immigrant workers to depart from farm employment after only a few days. Colorado's existing overtime rule is poorly suited to agricultural employment On many farms, employees work far from headquarters and without direct supervision in circumstances that make documenting, and verifying, the exact hours they work difficult, if not impossible. As a consequence, agricultural producers often rely upon shift-based wages or weekly salaries. An overtime rule that fails to recognize this farm labor reality would not be well-received by our industry. We therefore encourage the Department to maintain the current agricultural exemption from the MWO, or to consider alternatives to the existing daily and weekly overtime rule that would be realistic and workable for our many, and varied, agricultural industries. It is also important that wage and hour rules applicable to farm workers take into account that agricultural employers typically provide benefits in addition to an hourly wage or salary. These include free or low-cost housing; the use of a farm vehicle to travel to and from work; the opportunity to graze livestock on the employer's land at no cost; the opportunity to grow a crop on the employer's land at no cost; meat at no cost when farm animals are harvested; and provisions of fruits and vegetables at no cost during harvest season. These benefits are generally considered, by both employers and employees, as part of the value paid in return for a farm worker's labor. Benefits like these, many of which are unique to farm and ranch employment, help explain why including agriculture in the MWO will not only be challenging for employees and employers, but will also be challenging for the Department to implement.

10

Like Colorado’s ski industry that is seasonal in nature and today enjoys a partial exemption from overtime requirements, many sectors of Colorado’s agriculture industry are also seasonal. Unlike the ski industry, construction industry, or restaurant industry, however, each of which can raise the price of a lift ticket, the contract price of constructing a new home, or the cost of a meal served, agricultural producers are almost entirely unable to pass on increased production and labor costs. Agriculture is, by and large, part of a commodities market. As such, most agricultural producers don’t set the price for their products – they simply have to accept the price offered to them by the local elevator operator, by the produce purchaser, by a processing plant, or by a livestock broker. Each sector of the industry is also subject to extraordinarily volatile market conditions, driven by factors such as weather and global trade. By way of example, for Colorado’s sugarbeet growers, increased labor costs would shrink already slim margins in an industry where hours worked aren’t necessarily set by the farm employer. During harvest time in Colorado, the receiving site for surgarbeets typically opens at 7:00 a.m., which means the truck driver hauling sugarbeets must leave the farm by 6:30 a.m. to arrive at the receiving site as close to 7:00 a.m. as possible. Harvesting continues throughout the day with trucks loading at the farm and delivering as many loads of sugarbeets as they can to the receiving site before it closes at 7:00 p.m. After unloading the day's last load, the truck returns to the farm and loads for the next morning's first delivery. The driver often can't leave the farm until after 7:30 p.m. In this real-life scenario, the hours worked are dictated by the operation of the receiving site, rather than by the sugarbeet farmer. The Stup Report devotes a section to the question, “What Impact Might Overtime Have on the Workforce?”

Given the seasonal demands of farming and reported worker demand (Maloney, Eiholzer and Ryan 2016), many farm employees work more than 40 hours per week and would be affected by overtime regulations. If overtime hours do not change, employees will receive higher income under mandatory overtime. However, if farms (1) decrease hours through downsizing or mechanization or (2) hire additional employees, the impact of mandatory overtime on take-home wages is indeterminate. Recent studies suggest that employers would be under pressure to take these types of actions under mandatory overtime, due to substantial decreases in farm income if hours were to be held constant. Wells and Ifft (2017) considered the impact of overtime on New York fruit farms and found that wages could increase up to 19 percent depending on rules and that farm costs could increase substantially. Farm Credit East (2019) recently estimated that farm income could decline over 23 percent due to combined minimum wage and overtime rules.

* * *

11

Overtime laws may have a greater impact on minimum-wage employees, partially due to higher prevalence of a 40-hour work week in the U.S. (Trejo, 1991). This is especially true in the farm sector, where front-line employees often work in excess of 40 hours a week. Overall, the economics literature suggests that a variety of responses to overtime laws are possible. The net benefit to farm employees is uncertain over the long-run, given that reduction of hours or shiftwork is an option that farm employers may need to consider to remain profitable.

Stup Report at 14-15. Farm Credit East, which provides financial support for agricultural producers throughout the northeastern United States, also commented on the affects of new overtime requirements for farmworkers in New York:

• Labor related costs are a major component of the overall cost of production on many New York farms in part due to the labor-intensive nature of many of the state’s agricultural products, especially for products such as dairy, fruit, vegetable, nursery and greenhouse.

• New York farmers compete in national and international markets and have limited power to increase their prices.

• The increased labor costs resulting from the imposition of mandatory overtime pay in combination with scheduled increases in the minimum wage could impact the financial viability of many farms by significantly reducing net farm income.

• Mandatory overtime pay for agricultural employees would result in increased labor costs for farms of about 17.2 percent. This increase would be in addition to higher costs from the increases in minimum wage scheduled to occur over the next few years.

• When the effect of mandatory overtime pay for agricultural employees is combined with the previously approved minimum wage increases, agricultural labor costs in New York are estimated to increase by approximately $299 million.

• Although some farms may hire additional workers instead of paying existing workers overtime, given the current conditions in the agricultural labor market, at most 15 percent of the overtime hours could be replaced by hiring new workers.

• Higher labor costs from overtime pay will drive up other costs, including payroll taxes and workers compensation. These additional costs are not projected in this analysis but would place additional financial requirements on farms.

• The increase in labor costs resulting from mandatory overtime pay and the $12.50 minimum wage when fully implemented is estimated to reduce net farm income by 23.4 percent.

• A significant increase in wage expense could incent employers to cut back other benefits received by farmworkers. Higher labor costs would serve as a disincentive to hiring additional workers, and in some cases, if farms cease operations or shift to less labor-intensive crops, jobs could be lost both in production agriculture as well as related processing and marketing businesses.

12

Farm Credit East, Knowledge Exchange Report: The Economic Impact of Mandatory Overtime Pay of New York State Agriculture” (February 25, 2019) (available at: https://www.farmcrediteast.com/knowledge-exchange/Reports/the-economic-impact-of-overtime-nys) (the “Farm Credit Report). The Farm Credit Report also states, “Farms have considerable capital investments and may not be able to make short-term production shifts to adjust operations. Given that farms are largely price takers, it is difficult, if not impossible, for farms to simply pass through higher costs for energy, feed or other expenses. Thus, farms are unlikely to be in a position to pass through higher labor costs.” Further, because of the “volatility in farm income year to year, the impact of these increases in labor costs are also highly variable – they could reduce net farm income anywhere from 19 – 39 percent, depending on the year. While some labor costs are variable, in the short-term the increase labor costs will have to be covered regardless if it is a profitable year or not.” The Farm Credit Report concludes by stating:

While some workers may benefit from increased earnings, other workers may find their hours reduced as a result of employers trying to manage their increased costs. Wages are just one component of total compensation and ag employers may manage costs by cutting back other benefits, including health insurance, profit sharing, housing or food allowances. Many of New York’s farmworkers attempt to work as many hours as possible during peak periods, often to save money or send remittances. This includes seasonal workers who come to the U.S. with the H-2A visa program who will also be covered by the mandatory overtime requirement. To the extent employers attempt to reduce expenses by cutting back hours, they are concerned that H-2A or other workers looking to maximize hours will choose to work in other regions. In general, a significant increase in labor costs would serve as a disincentive to hiring additional workers, and in some cases, if farms close or shift to less labor-intensive crops, jobs could be eliminated. The greatest impact of this labor cost increase would likely be on New York’s most labor-intensive agriculture: dairy, fruit, vegetable, greenhouse and nursery sectors.

A 2017 report similarly explained, with respect to apple growers, that “labor is the number one cost in apple producing businesses, accounting for 40-50% of farm operating expenses.” The report warns that “[t]he financial impact to apple farms by the minimum wage schedule will be significant on its own, with an expected 7% increase in hourly labor wages per year through 2021. This, coupled with the potential loss of the agricultural overtime exemption, will put many farms in a perilous financial position. A $1,400–$2,600 per bearing acre in cash operating cost would likely put many farms in an unprofitable position. Conservatively, the increased costs of labor statewide would exceed $60 million per year by 2021 in an industry with an average farm gate value of $250 million. When costs increase substantially in any industry, management takes action to mitigate the impact. A critical challenge for New York fruit farms

13

over the next decade will be making the management changes and investments necessary to increase resilience to increasing labor costs.” M. Wells & J. Ifft, “The Impact of New York’s Minimum Wage Rules and Overtime on New York Apple Growers,” 25 Fruit Quarterly 30, 31 (Summer 2017). The Northern New York Agricultural Development Program, in a 2018 project report, recognized labor as the second largest, single expense on a dairy farm behind the cost of feed. The survey of 32 New York dairy farms found:

Of the aggregate total of 593 employees referenced by all the dairy farm owners surveyed: o 258 were working 60 – 70 hours per week o 161 were working 50 – 60 hours per week o 80 were working 40 – 50 hours per week o 66 were working 20 – 40 hours per week o 33 were working less than 20 hours per week This indicates the most prevalent weekly hours’ scheduling of farm labor, but also indicates that if overtime laws are passed for agricultural businesses that dairy farm owners will have to change their labor scheduling significantly. Finally, of the dairy farms surveyed, 16 farms elected to have 12-hour shifts, while 10 had 8-hour shifts, 4 had 4 hour shifts and one employed only part-time help. This indicates that while 12-hour shifts are the most common, 8-hour shifts are relatively common as well.

Northern New York Agricultural Development Program, “Labor Trends and Their Impact on Financial and Production Factors on Dairy Operations in Northern New York” (2018) (available at: https://www.nnyagdev.org/wp-content/uploads/2019/05/NNYADP19DairyLaborTrendsReportFINAL.pdf). The report concludes that farms utilizing longer shifts were overall more likely to offer benefits. In sum, imposing the current daily or weekly overtime rule on agricultural employers would create multiple layers of challenges and difficulties for Colorado’s many agriculture industries, as well as for the Department. Many farm employees do not, and cannot, adhere to schedules that are subject to accurate time documentation. As a consequence, agricultural employers have, for decades, adopted shift-based wages or weekly salaries, bolstered by benefits that are unique to farms and ranches located in rural locations. Moreover, farms and ranches do not benefit from the opportunity other industries have to alter working hours or the length of work days, as often farm work, such as harvesting crops or moving herds, must be completed during daylight hours. Likewise, a farm’s hours of operation may be largely driven by weather. Further, agricultural products are, for the most part, commodities, meaning that producers have little if any leverage to raise prices in response to increased labor costs and typically operate with razor-thin margins. Finally, Colorado agriculture is not monolithic. An overtime

14

rule that might be workable for an employer whose product is grown and harvested inside a warehouse may be impossible for a cattle ranch to comply with while remaining in business. We therefore request that the Department decline to expand the MWO to agricultural employers. H2A workers should be exempt from the Minimum Wage Order Colorado’s lamb and wool production, and some of its cattle production, is intrinsically linked to open-range work and the H-2A guest worker program. The H-2A program is in existence because of the lack of a U.S. work force to fill these positions. H-2A sheep herders, shearers and other livestock workers are a crucial component of a significant portion of the Colorado and western states agricultural industry. As acknowledged in the U.S. Department of Labor’s 2015 rulemaking (Federal Register 20 CFR Part 655 - Temporary Agricultural Employment of H-2A Foreign Workers in the Herding or Production of Livestock on the Range in the United States; Final Rule; October 16, 2015), the range herding workforce is nearly -- or in some areas, completely -- occupied by H-2A workers. There simply is not a domestic workforce for these positions. See 20 C.F.R. § 655 (Temporary Agricultural Employment of H-2A Foreign Workers in the Herding or Production of Livestock on the Range in the United States) (October 16, 2015). As states across the nation reconsider their minimum wage and overtime rules, they are frequently proposing wage orders that are in direct conflict with the federal H-2A Herder and Production Livestock rules. The Department should decline to follow suit. The work of range herders occurs, by definition, far away from an employer's headquarters and managers, where it is inherently difficult to document the actual hours a particular employee works. Congress recognized this in expressly exempting range herders from both the overtime and minimum wage requirements of the FLSA. Further, courts have rejected the argument that herders' on-call time is compensable, instead affirming the DOL’s rules that establish the hours included in a herder’s workday. See, e.g., Hispanic Affairs Project v. Acosta, 901 F.3d 378, 391-393 (D.C. Cir. 2018). Arguably, efforts by states to set wages that apply exclusively to H-2A workers fundamentally interferes with the federal government's exclusive oversight of the nation's immigration laws. See, e.g., Arizona v. United States, 567 U.S. 387 (2012) (federal immigration law preempts state law efforts to regulate immigration). Additionally, H-2A rancher-employers provide 100% of the living expenses, including housing, food, and transportation, for which workers in non-farm jobs are typically responsible, making 100% of an H-2A worker’s pay “disposable income.” State laws to increase wages and apply overtime rules to H-2A herding fundamentally ignore this critical difference. At the very least, employers should be able to set aside these benefits in calculating an H-2A employee’s regular rate under any applicable overtime rule.

15

In 2015, sheep herders’ wages in Colorado were raised to $1,206 per month, continued to increase to $1,633 per month in 2019. At the same time, 2019 lamb prices are less than what they were in 2015. As with most of agriculture, the livestock industry is, by and large, a commodity market, and as such is subject to extremely volatile market conditions. The rate at which the minimum wage an employer of H-2A workers must pay is increasing and is rapidly eliminating the opportunity for those employers to capture any margin, thus pushing producers of livestock out of business. As a result, smaller operations are disappearing. The following charts show the trend of feeder lamb and feeder cattle market prices with the changes in mandated H-2A wages for herders (the “Adverse Effect Wage Rate” or “AEWR”):

As reported by the American Farm Bureau Federation, based upon DOL data, Colorado’s AEWR increased 23% from 2018 to 2019. This increase was among the three highest increases across the nation. See American Farm Bureau Federation, "H2-A and the AEWR We Were" (March 15, 2019) (available at: (https://www.fb.org/market-intel/h-2a-and-the-aewr-we-were). Another characteristic unique to the sheep industry is the need for sheep shearers. The average size of a shearing contractor’s entire crew is less than 25 employees, taking into account all certifications and occupations. Particularly with respect to wool production, the length of shearing seasons varies, depending on the geographic areas’ production practices and climate. For example, in certain areas it is

16

healthier for female sheep to be sheared prior to birthing offspring. The removal of the wool lessens the dirt and feces that can be retained in the fleece and keeps the animal cleaner. Further, the wool around the mammary glands – the “udder” -- can inhibit a baby lamb’s ability to locate the teat for suckling. The window of time in which this shearing task can be performed is relatively narrow in order to maximize the benefit to the ewe and offspring without harming either. Moreover, shearing cannot take place during inclement weather, as it places undue stress on the animals, harms the quality of the wool, and causes equipment and logistical difficulties for the shearing crews, which can place the shearers at a heightened risk of injury. By definition, the jobs of range workers and sheep shearers are itinerant, and their earning potential is dependent on traveling to, or moving with, the sheep or livestock. Movement of animals across state lines allows for ranchers to take advantage of optimal ranges for grazing. This, too, would create confusion, as workers may be subject to a particular wage order while they are on one side of a border, and a different set of wage and hour rules while on the other. Paid breaks rest periods and uncompensated mealtime Finally, the paid-break and uncompensated-mealtime provisions of the MWO do not align with the realities of farm and ranch work. In many instances, the physical, outdoor nature of farmworkers’ jobs requires shorter, more frequent breaks to rest and hydrate. Scheduling those breaks at particular times and for particular durations simply does not make sense in the middle of harvest or during a shift in a milking barn. This is yet another reason that agricultural producers rely on shift-based wages and periodic salaries that do not require maintaining precise records for each break from work a particular employee takes. As the MWO contemplates, there are circumstances in which a non-farm employer cannot provide an employee a full, thirty-minute, interruption-and-work-free break to consume a meal while at work. The employer addresses this situation by paying the employee to work while eating. This is the standard operating procedure in many agricultural industries. As a consequence, we believe application of the MWO to farm and ranch employers is unnecessary. Conclusion In conclusion, we believe the present exemption from the MWO for agricultural employers is reasonable and appropriate. Agricultural production is different from other forms of work along most every measure. From being driven by weather, to requiring physical, outdoor work in remote locations, to mandating sustained effort by all involved at particular times of the year so as to meet the extremely time-sensitive demands of harvest season, farm and ranch employers and employees work in an environment that is unlike most, if not all, others. We appreciate the opportunity to describe the world in which our members and their constituents operate, and to submit these comments to you. We have no doubt you will give them your good faith attention and sincere consideration. Based on all that we have outlined here, we urge the Department to retain, without amendment, the current exemption for agricultural employers from the state’s Minimum Wage Order.

17

Sincerely,

Terry Fankhauser Terry Fankhauser, Chair Colorado Agriculture Council

December 31, 2019 Mr. Michael Primo Rule Coordinator Division of Labor Standards and Statistics Colorado Department of Labor and Employment 251 E 12th Ave. Denver, CO 80203 [email protected] RE: Proposed Colorado Overtime & Minimum Pay Standards Order #36 Dear Mr. Primo, On behalf of the Colorado Agriculture Council1 and its more than twenty member organizations, please accept the following comments in support of the Colorado Department of Labor and Employment Division of Labor Standards and Statistics' (the "Department's") proposed Colorado Overtime & Minimum Pay Standards Order #36 (the "COMPS Order") as it relates to agricultural workers and employers. We appreciate the Department’s consideration of our prior written comments (attached) during the informal rulemaking process, as well as our testimony during public comment on Monday, December 16, 2019. That in mind, we submit the following additional comments for your consideration. Background The Colorado Ag Council pulls together organizations from across the state that represent and serve Colorado's farmers, ranchers, and other agricultural producers. The Ag Council acts as a forum for discussion and review of issues that affect Colorado's many agricultural industries. In addition to acting as a forum, the Ag Council also advocates for our rural communities, including sponsoring the Colorado Ag Water Alliance (CAWA), organizing and hosting National Agriculture Week activities at the State Capitol, and providing annual financial and in-kind support for food banks and the nonprofit organizations that operate them across the state.

1 www.coloradoagcouncil.net

2

Colorado Ag Council members include: Colorado Aquaculture Association

Colorado Association of Conservation Districts Colorado Association of Wheat Growers Colorado Cattlemen’s Association Colorado CattleWomen, Inc. Colorado Corn Growers Association Colorado Dairy Farmers PAT/PAC Colorado Egg Producers Association Colorado Farm Bureau Colorado Fruit and Vegetable Growers Association Colorado Horse Council Colorado Independent CattleGrowers Association Colorado Livestock Association Colorado Onion Association Colorado Pork Producers Council Colorado State Grange Colorado Sugarbeet Growers Colorado Wool Growers Association GreenCO of Colorado National Young Farmers Coalition Rocky Ford Growers Association Rocky Mountain Agribusiness Association Rocky Mountain Farmers Union

Range workers We understand from participating in the stakeholder process that the Department intends to exempt range workers from all but Rules 1 (Authority and Definitions), 2 (Coverage and Exemptions), and 8 (Administration and Interpretation) of the COMPS Order for the same reasons that these workers are exempt from the federal Fair Labor Standards Act (the "FLSA") minimum wage and overtime provisions.2 We support the Department in doing so. As the U.S. Department of Labor recognizes in its regulations implementing the FLSA exemption, range workers actively care for grazing livestock and stand at the ready to do so at all times, frequently working on large tracts of uncultivated land that are remote from a farm or ranch headquarters.3 These job duties generally require that range workers have access to employer-provided housing that permits them to move with the animals they tend and to remain in the field for extended periods of time.4 Because of the remote, mobile, and unsupervised nature of their work, it would be extremely difficult to monitor and document a range worker's daily working hours. Thus, the federal government recognizes an exemption for range workers with respect to both minimum wage and overtime requirements.5

2 See 29 U.S.C. § 213 (a) (6) (E) (exempting employees principally engaged in the range production of livestock). 3 See 29 C.F.R. §§ 780.323 - 329. 4 See 30 C.F.R. § 655.122 (d) (requiring employer-provided housing at no cost for H-2A range workers and others who cannot reasonably return to their residence at the conclusion of a workday). 5 See 29 C.F.R. § 780.329 (a), (c) (exempt work).

3

As the United States Court of Appeals for the Tenth Circuit recently made clear, the FLSA's range worker exception is narrowly drawn. It applies only to those agricultural workers who actually work in remote locations, without supervision, tending to and protecting, on a day-long basis, sheep, goats, cattle, horses, or other domesticated animals grazing on land well apart from farm or ranch operations, making it practically impossible for an employer to monitor or confirm their work hours.6 We understand the Department, likewise, intends its range worker exception to apply only to those agricultural workers whose remote location and constant attention to a herd or flock would make payment based on actual hours worked both impractical and extremely difficult to administer. In order to assure that the Department's intention underlying this exemption is clear, we suggest the following be added as Subsection (E) to Rule 2.2.7: 2.2 Exemption from All except Rules 1, 2, and 8. The following are exempt from the COMPS Order except Rules 1 (Authority and Definitions), 2 (Coverage and Exemptions), and 8 (Administration and Interpretation).

* * * 2.2.7 In-residence workers. This exemption covers the below-listed in-residence employees.

* * *

(E) Range workers involved in the herding or production of livestock on the range who generally occupy housing provided by their employer, at no cost to the worker, while they work.

We believe that placing the range worker exemption in Rule 2.2.7 accurately, and reasonably, treats range work similarly to other jobs performed by workers who live where they work and work where they live, and who must remain constantly at the ready to perform their duties. Farm & Ranch Workers: Minimum Wage & Overtime We support the Department's recognition in the COMPS Order that, in accordance with Article XVIII, Section 15 of the Colorado Constitution, agricultural workers who are exempt from the FLSA's minimum wage provisions are, likewise, exempt from Colorado's minimum wage requirement. As we understand it, the Department has adopted the reasoning underlying the federal 500 Man-Day Rule, which acknowledges that imposing a minimum wage mandate on small agricultural businesses does not comport with the economic realities, as well as the job-related benefits, of farm and ranch life.

6 See Mencia v. Allred, 808 F.3d 463, 469 (10th Cir. 2015) (worker characterized as a "sheepherder" who did not meet the applicable range worker test was not exempt from FLSA minimum wage and maximum hour requirements).

4

Along the same line, and as we discussed at length in our previous comments, we appreciate and support the Department's recognition that agricultural work does not square with the daily and weekly overtime requirements applicable under the COMPS Order to most non-farm jobs. Many farm employees do not, and cannot, adhere to schedules that are subject to accurate time documentation. As a consequence, agricultural employers have, for decades, adopted shift-based wages or weekly salaries, bolstered by benefits that are unique to farms and ranches, such as employer-provided housing and harvest sharing. Moreover, farms and ranches do not benefit from the opportunity other industries have to alter working hours or the length of work days, as farm work, such as harvesting crops or moving herds, must often be completed during daylight hours. Likewise, a farm’s hours of operation may be largely driven by weather events that are entirely beyond the farm's control. Further, agricultural products are, for the most part, commodities, meaning that producers have little, if any, leverage to raise prices in response to increased labor costs that must be addressed with razor-thin margins. Finally, Colorado agriculture is not monolithic. An overtime rule that might be workable for an employer whose product is grown and harvested inside a warehouse may be impossible for a cattle ranch to comply with while remaining in business. We therefore support the COMPS Order's continued recognition that agricultural workers are exempt from Colorado's overtime requirements, just as they are under the FLSA.7 Meal & Rest Periods We have reviewed, and we support, Rule 2.3.1, which addresses meal and rest breaks. We appreciate the Department's recognition that farm and ranch work, unlike work in an office or a retail business, often does not include the "downtime" necessary to permit a thirty-minute, interruption-and-work-free break to consume a meal. Thus, we support permitting agricultural employers to maintain their practice of paying employees to continue working while they eat in those circumstances, such as during harvest or while working a milking barn shift, where every minute counts. We likewise appreciate the Department's effort to craft a rest break rule that works in the context of agricultural production. As we discussed in our previous comments, in many instances, the physical, outdoor nature of farmworkers’ jobs requires shorter, more frequent breaks to rest and hydrate. We believe Rule 2.3.1 affords farms and ranches reasonable flexibility in providing those breaks, while appropriately recognizing that our workers need the opportunity to step away from their duties to rest throughout their work periods. Colorado’s Agricultural Employment Our comments presented here are grounded in the fact that Colorado’s agriculture industry is diverse -- very diverse -- ranging from dryland wheat and irrigated corn production in the Eastern and Northeastern parts of the state, to the growing of alfalfa and potatoes in the San Luis Valley. While livestock grazing occurs across the state, it is the dominate sector on the Western Slope, and specialty crop production, including growing and harvesting of the famous Rocky Ford cantelope, is the major agricultural driver in parts of the Arkansas River Valley and the Northern Front Range. In other parts 7 See 29 U.S.C. § 213 (a) (6) (minimum wage exemption), (12) (overtime exemption).

5

of the state we have wine production and agri-tourism, along with aquaculture and nursery and greenhouse operations. In our prior written comments, we noted the 2019 Colorado Business Economic Outlook, published by the University of Colorado’s Leeds School of Business, which painted a somber picture for Colorado’s agriculture industry. The 2019 report stated that agricultural producers are “weathering a storm of commodity prices, trade uncertainties, and unfavorable economic conditions.”8 Just this month the Leeds School of Business released its 2020 outlook. The latest report states, “Someone is making money in Colorado agriculture and food systems. It just may not be farmers and ranchers. Processors, packers, and others in the supply chain may be seeing most of the benefits of an increase in cattle and dairy numbers in Colorado. The agriculture value chain has many segments, and one often makes money while others experience losses.”9 Two additional publications shed light on employee wages. First, the Governor’s Office of State Planning and Budgeting December 20, 2019, Colorado Economic and Fiscal Outlook states:

Job growth continues at a faster rate than labor force growth, driving unemployment to its lowest rate on record, at 2.6 percent. Wage growth remains above inflation at 4.2 percent, supporting continued growth in consumer activity. While certain industries – notably agriculture and manufacturing – are experiencing significant negative impacts from tariffs and trade conflicts, Colorado’s overall economy is expected to continue to grow throughout the forecast period.10

Second, the United States Department of Agriculture’s (USDA's) National Agricultural Statistics Service (NASS) recently released its annual Farm Labor Survey. The survey notes:

Farm operators paid their hired workers an average gross wage of $15.02 per hour during the October 2019 reference week, up 4 percent from the October 2018 reference week. Field workers received an average of $14.38 per hour, up 5 percent. Livestock workers earned $13.77 per hour, up 3 percent. The field and livestock worker combined gross wage rate, at $14.21 per hour, was up 4 percent from the 2018 reference week. Hired laborers worked an average of 42.5 hours

8 Business Research Division, Leeds School of Business, University of Colorado Boulder, Colorado Business Economic Outlook 2019, p. 16 (available at https://www.colorado.edu/business/sites/default/files/attached-files/2019_colorado_business_economic_outlook_011719.pdf). 9 Business Research Division, Leeds School of Business, University of Colorado Boulder, Colorado Business Economic Outlook 2020, p. 16 (available at https://coloradosun.com/wp-content/uploads/sites/15/2019/12/2020-BEOF-Book-FINAL-Printable-Full-Book.pdf). 10 State of Colorado, Governor’s Office of State Planning and Budgeting, Colorado Economic and Fiscal Outlook December 20, 2019, p. 3 (emphasis added) (available at https://drive.google.com/file/d/18TUaXuzNssi2Xf1wWpfIWWvvtX4Ml45f/view).

6

during the October 2019 reference week, up 2 percent from the hours worked during the October 2018 reference week.11

More specifically, the Farm Labor Survey report shows in the table below the number of hired workers and hours worked by region between 2018 and 2019. Colorado joins Nevada and Utah in the survey’s Mountain II region12.

The same Survey shows the annual average wage growth rates between 2018 and 2019 by region13:

11 United States Department of Agriculture, National Agricultural Statistics Service, Agricultural Statistics Board, Farm Labor Survey, November 21, 2019, p. 1 (available at https://downloads.usda.library.cornell.edu/usda-esmis/files/x920fw89s/c821h164m/fq9788943/fmla1119.pdf). 12 See Farm Labor Survey, p. 24. 13 See Farm Labor Survey, p. 25.

24 Farm Labor (November 2019) USDA, National Agricultural Statistics Service

Annual Average Number of Hired Workers and Hours Worked – Regions and United States: 2018 and 2019 [Excludes agricultural service workers and Alaska]

Regions1 and United States

Hired workers Hours worked 2018 2019 2018 2019

(1,000) (1,000) (hours per week) (hours per week) Northeast I ................................................. Northeast II ................................................ Appalachian I ............................................. Appalachian II ............................................ Southeast .................................................. Florida ........................................................ Lake ........................................................... Cornbelt I ................................................... Cornbelt II .................................................. Delta .......................................................... Northern Plains .......................................... Southern Plains .......................................... Mountain I .................................................. Mountain II ................................................. Mountain III ................................................ Pacific ........................................................ California ................................................... Hawaii ........................................................ United States .............................................

33.3 34.3

30.0 24.0

26.0

34.0

53.5

40.8 21.0

27.5

34.8 48.5

25.3 17.3 17.5

75.0

153.5

6.3

702.3

32.5 30.5

31.5 22.8

25.0

33.3

56.0

34.8 23.3

27.3

33.8 43.0

25.8 16.8 15.8

77.3

151.5

4.5

684.8

40.2 37.5

39.8 38.8

39.0

40.8

38.5

36.4 33.5

42.7

43.8 36.9

43.7 44.2 46.1

41.3 42.6

35.4

40.4

40.4 39.6

38.9 39.0

39.5

40.8

40.1

36.7 37.0

43.0

42.9 39.7

45.2 43.4 46.5

42.7 43.1

36.0

41.2

1 Region map on page 30.

7

The following four tables from the Survey show the annual average gross wage rate and base wage rate by occupational classification14:

14 See Farm Labor Survey, pp. 26-29.

Farm Labor (November 2019) 25 USDA, National Agricultural Statistics Service

Annual Average Gross Wage Rates – Regions and United States: 2018 and 2019 [Excludes agricultural service workers and Alaska. Annual rates are averages of the published wage rates for each survey week weighted by the number of hours worked during the week]


Field Livestock Field and Livestock All Hired

2018 2019 2018 2019 2018 2019 2018 2019

(dollars per hour)

(dollars per hour)

(dollars per hour)

(dollars per hour)

(dollars per hour)

(dollars per hour)

(dollars per hour)

(dollars per hour)

Northeast I .................................... Northeast II ................................... Appalachian I ................................ Appalachian II ............................... Southeast ..................................... Florida .......................................... Lake ............................................. Cornbelt I ...................................... Cornbelt II ..................................... Delta ............................................. Northern Plains ............................. Southern Plains ............................ Mountain I ..................................... Mountain II .................................... Mountain III ................................... Pacific ........................................... California ...................................... Hawaii .......................................... United States ................................

13.48 13.22

12.27 11.58

11.18 11.21

13.64

13.23 13.46

11.41

15.21

12.04

13.24 12.81 11.64

15.13 13.86

14.45

13.32

14.65 13.42

12.74 12.26

11.76 11.75

14.88

14.68 14.35

11.74

16.24

12.30

13.36 14.19 12.39

15.91 14.71

14.72

14.11

(NA) (NA)

(NA) (NA)

(NA) (NA)

(NA)

(NA) (NA)

(NA)

(NA)

(NA)

(NA) (NA) (NA)

(NA) (NA)

(NA)

(NA)

13.81 13.12

12.46 12.61

11.55 11.52

14.12

14.14 14.79

12.12

13.61

12.96

13.86 14.35 13.58

14.99 15.04

16.18

13.74

13.25 13.15

12.25 11.63

11.13 11.24

13.54

13.26 13.34

11.33

14.38

12.23

13.48 13.13 12.00

15.03 13.92

14.73

13.25

14.29 13.34

12.67 12.40

11.71 11.71

14.40

14.52 14.58

11.83

14.99

12.67

13.62 14.26 12.91

15.83 14.77

14.90

13.99

14.19 13.95

12.91 12.51

11.96 12.13

14.16

14.28 14.00

11.84

15.10

12.93

14.12 14.03 12.84

15.62 15.41

16.43

14.17

15.39 14.63

13.30 13.16

12.38 12.58

15.04

15.37 15.26

12.21

15.72

13.46

14.46 14.95 13.61

16.37 16.21

16.61

14.91

(NA) Not available. 1 Region map on page 30.


Annual Average Gross Wage Rate and Base Wage Rate by Standard Occupational Classification (SOC) System – Regions and United States: 2019 [Excludes agricultural service workers and Alaska. Annual gross and base wages are averages of the wage rates for each survey week weighted by the number of hours worked during the week]


Graders and sorters, agricultural products SOC Code (45-2041)

Agricultural equipment operators SOC Code (45-2091)

Gross wage Base wage Gross wage Base wage

(dollars per hour) (dollars per hour) (dollars per hour) (dollars per hour) Northeast I ........................... Northeast II .......................... Appalachian I ....................... Appalachian II ...................... Southeast ............................ Florida .................................. Lake ..................................... Cornbelt I ............................. Cornbelt II ............................ Delta .................................... Northern Plains .................... Southern Plains .................... Mountain I ............................ Mountain II ........................... Mountain III .......................... Pacific .................................. California ............................. Hawaii .................................. United States .......................

13.29 13.77

11.38 11.66

8.90

12.07

12.61

(S) 14.41

(S)

(S)

(S)

(S)

13.04 11.90

14.64 14.59

14.28

13.13

13.27 12.94

11.17 11.66

8.85

11.87

11.85

(S) (S)

(S)

(S)

(S)

(S)

12.72 10.20

13.92 13.65

14.18

12.57

15.46 14.86

(S)

13.97

12.22 12.20

15.06

16.32 14.81

12.13

16.57

13.29

13.19 14.66 13.09

15.98 15.25

18.16

14.58

14.98 (S)

(S)

13.84

12.06 12.02

14.84

15.62 14.51

11.86

16.27

13.17

12.98 14.24 12.55

15.32 13.83

(S)

14.06

See footnote(s) at end of table. --continued

8


Annual Average Gross Wage Rate and Base Wage Rate by Standard Occupational Classification (SOC) System – Regions and United States: 2019 (continued) [Excludes agricultural service workers and Alaska. Annual gross and base wages are averages of the wage rates for each survey week weighted by the number of hours worked during the week]


Farmworkers, crop, nursery, and greenhouse

SOC Code (45-2092)

Farmworkers, farm, ranch, and aquacultural animals

SOC Code (45-2093) Gross wage Base wage Gross wage Base wage

(dollars per hour) (dollars per hour) (dollars per hour) (dollars per hour) Northeast I ........................... Northeast II .......................... Appalachian I ....................... Appalachian II ...................... Southeast ............................ Florida ................................. Lake .................................... Cornbelt I ............................. Cornbelt II ............................ Delta .................................... Northern Plains .................... Southern Plains ................... Mountain I ............................ Mountain II ........................... Mountain III .......................... Pacific .................................. California ............................. Hawaii ................................. United States .......................

14.52 13.10

12.54 11.51

11.74 11.52

14.91

13.73 13.92

11.34

14.23

12.35

13.75 13.68 12.27

16.00 14.56

14.33

13.98

14.23 12.81

12.43 11.37

11.66 11.38

14.45

13.25 13.53

11.19

14.02

11.92

13.34 13.47 11.62

14.73 13.64

13.79

13.33

13.72 12.66

12.30 12.47

11.76 11.47

14.04

13.75 14.76

12.03

13.47

12.61

13.78 14.12 13.57

14.96 14.93

16.31

13.60

13.19 12.46

12.29 12.09

11.70 11.45

13.70

13.54 14.62

11.90

13.20

12.51

13.67 13.65 13.37

14.60 13.63

15.81

13.22





Agricultural worker, all other SOC Code (45-2099)

Packers and packagers, hand SOC Code (53-7064)


(dollars per hour) (dollars per hour) (dollars per hour) (dollars per hour) Northeast I ........................... Northeast II .......................... Appalachian I ....................... Appalachian II ...................... Southeast ............................ Florida .................................. Lake ..................................... Cornbelt I ............................. Cornbelt II ............................ Delta .................................... Northern Plains .................... Southern Plains .................... Mountain I ............................ Mountain II ........................... Mountain III .......................... Pacific .................................. California ............................. Hawaii .................................. United States .......................

(S) 13.49

(S)

13.03

(S) 11.70

13.25

(S) (S)

11.40

(S)

(S)

(S) (S)

12.50

16.07 (S)

(S)

14.16

(S) 13.03

(S)

12.95

(S) 11.68

13.06

(S) (S)

11.37

(S)

(S)

(S) (S)

12.32

15.71 (S)

(S)

13.86

13.42 (S)

(S)

11.99

(S) 12.96

(S)

(S) (S)

12.25

(S)

(S)

(S) (S) (S)

13.80 15.70

12.90

14.07

12.82 (S)

(S)

11.98

(S) 12.84

(S)

(S) (S)

12.25

(S)

(S)

(S) (S) (S)

13.50 13.25

(S)

12.91


9

Agricultural Sector Volatility In our prior written comments, not only did we try to demonstrate the uniqueness and diversity of the agriculture industry, we also tried to demonstrate how agricultural producers are price takers, not price makers, and are, with the exception of some specialty sectors of the industry, forced to accept whatever price is being offered for their commodities. Further, we tried to demonstrate how circumstances across the country, and around the globe, impact both commodity prices and farm incomes. Following are a few examples that are noted in the Colorado Business Economic Outlook 2020 report15:

• “The beef market was disrupted by a fire at a packing plant in Kansas on August 9, 2019. The reduction in processing capacity caused by the fire dropped prices for fed cattle and for steers and heifers being sold to feedlots, while prices for boxed beef shot up…”

• “The animal protein complex of beef, pork, chicken, and lamb was expecting a bump in 2018 and 2019 prices because of African Swine Fever (ASF) in China. …ASF is the wildcard for the protein world. The enormous volume of pigs raised in China affects everything from the volume of protein in the world market to the

15 Business Research Division, Leeds School of Business, University of Colorado Boulder, Colorado Business Economic Outlook 2020, pp. 16-17 (available at https://coloradosun.com/wp-content/uploads/sites/15/2019/12/2020-BEOF-Book-FINAL-Printable-Full-Book.pdf).




Farmers, ranchers, and other agricultural managers SOC Code (11-9013)

First-line supervisors of farming, fishing workers SOC Code (45-1011)


(dollars per hour) (dollars per hour) (dollars per hour) (dollars per hour) Northeast I ........................... Northeast II .......................... Appalachian I ....................... Appalachian II ...................... Southeast ............................ Florida ................................. Lake .................................... Cornbelt I ............................. Cornbelt II ............................ Delta .................................... Northern Plains .................... Southern Plains ................... Mountain I ............................ Mountain II ........................... Mountain III .......................... Pacific .................................. California ............................. Hawaii ................................. United States .......................

(S) (S)

(S) (S)

(S)

22.15

(S)

(S) (S)

19.88

(S)

(S)

21.07

(S) (S)

24.79 31.70

(S)

24.65

(S) (S)

(S) (S)

(S)

22.06

(S)

(S) (S)

19.67

(S)

(S)

(S) (S) (S)

24.48 30.95

(S)

24.25

(S) (S)

(S)

19.77

19.51 20.90

(S)

21.40

(S)

(S)

20.97

(S)

20.33 (S) (S)

20.30 23.46

(S)

21.37

(S) (S)

(S)

19.46

19.30 20.71

(S)

20.66

(S)

(S)

20.87

(S)

(S) (S) (S)

20.09 22.35

(S)

20.85

(S) Insufficient number of reports to establish an estimate. 1 Region map on page 30.

10

amount of grains needed for feed worldwide.…The most recent estimate is that one of every four pigs in the world will die because of this disease.”

• “Further indication of the global nature of agriculture is the current decline in U.S.

beef exports to China, in part because of import tariffs. Because Australia is in a drought, cattle herds are being sold off. They are in closer proximity to China and have lower shipping costs, so China is purchasing Australian beef to the detriment of U.S. beef. However, the drought in Australia is likely to help Colorado lamb prices because Australia will be selling more lamb to Asia at lower prices because of the drought, lowering the supply of Australian lamb available in the United States.”

• “Corn farmers had a relatively good year, although prices remain low, at an

estimated average $3.75/bushel for 2019 compared to the $8/bushel farmers fondly remember from 2012. Colorado growers made up for the price deficit with good yields, especially on irrigated corn. They were able to get corn planted in the spring when many in the Midwest were fighting floods and had an advantage in the fall with better harvest conditions as many corn fields in the upper Midwest were covered in early season snowfall and are still waiting to be harvested.…Corn producers will need to continue to increase yields and efficiencies. More corn is expected to be planted throughout the United States as demand and prices for soybeans is low because of the trade situation with China. Soybean exports to China for 2019 are down 47% in Q3 2019. Colorado’s climate is not conducive to growing soybeans, so while Colorado farmers are not directly affected, they are indirectly affected because of down-ward pressure on markets and other farmers across the Midwest switching to corn because it is less expensive to grow than soybeans.”

We highlight these examples as they further demonstrate the economic reality of chronic uncertainty agricultural producers face, not only on an annual basis, but on a daily basis. And no matter how efficient a farmer’s or rancher’s operation may be, or how much planning they do, or how much management they employ to control costs, including labor costs, the potential to be operating at a loss is never far from reality. Operating at a loss when farmers and ranchers do not have the equity to survive market swings results in smaller farms and ranches going out of business, leading to more consolidation in the industry with fewer, larger operations. Any policy proposal that would further facilitate this trend would surely be counter to the interests of consumers, farmers and ranchers, and policy makers. Further illustrating the challenges of operating a financially sound farming operation, the National Farmers Union just last month released its annual Thanksgiving Farmer’s Share. The Farmer’s Share compares the retail food price of traditional holiday dinner items to the amount the farmer receives for each item they grow or raise. The report notes that farmers and ranchers take home just 14.6 cents from every food dollar that consumers

11

spend and that more than 85 percent of food costs cover marketing, processing, wholesaling, distribution and retailing.16 What does this mean for agricultural employers? For Colorado’s wheat growers, they receive $0.11 on two pounds of bread that retail for $3.79. Colorado’s beef producers receive $1.72 for a one-pound top sirloin steak that retails for $10.49. While Colorado has some of the top dairy producers in the country, that one-gallon of fat-free milk that retails at $4.09 returns just $1.71 to the farmer. And that 6-pack of beer that retails at $10.99 returns just $0.04 to the farmer.17 In releasing the most recent Thanksgiving Farmer’s Share, National Farmers Union President Roger Johnson said, “Farmers and ranchers play the most valuable role in actually producing the food that is served at holiday dinners, yet they make just pennies on the dollar for their products. The farmer’s share of the retail food dollar continues its gradual decline from year-to-year as food companies take in record profits and family farmers sell their farms. This is certainly not what the consumer wants, but it is what is happening behind the scenes of their Thanksgiving holiday.”18 Conclusion In closing, we are pleased the proposed COMPS Order recognizes that agricultural production is fundamentally different from other forms of work, and that the Order provides both reasonable and appropriate flexibility to Colorado's farms and ranches in managing, and paying, their workforces. We thank you for your attention to and consideration of the concerns we have raised and we look forward to continued dialogue. Sincerely, Terry Fankhauser Terry Fankhauser, Chair Colorado Agriculture Council

16 National Farmers Union, The Farmer’s Share, Thanksgiving Special, November 18,2019 (available at https://nfu.org/farmers-share/) 17 See The Farmer’s Share, Thanksgiving Special. 18 AGDAILY, “Farmers receive 12 cents of the Thanksgiving food dollar”, November 22, 2019 (available at https://www.agdaily.com/news/farmers-12-cents-thanksgiving-dollar/).

Documents

Rule Coordinator Division of Labor Standards and ......Iowa, Minnesota, Montana, Nebraska, Nevada, New Mexico, North Dakota, Oregon, South Dakota, Texas, Utah, Washington, and Wyoming