SALEM — After an emotional three-hour debate, the Oregon House voted 37-23 on Tuesday, March 1, to end the state’s agricultural exemption from higher overtime wages.

The measure is awaiting a vote in the Senate.

The overtime exemption would be phased out over five years under House Bill 4002, and tax credits would cover some of the higher wages paid by farmers, But critics claimed those provisions won’t prevent the inevitable loss of family farms.

“They could be the nail in the coffin for farmers who can’t absorb any more increased costs,” said Rep. David Brock-Smith, R-Port Orford.

Many growers operate on razor-thin margins and would likely go out of business while waiting for the promised money from tax credits, since they can’t afford higher overtime payments, he said.

Rep. Raquel Moore-Green, R-Salem, said House Bill 4002 also isn’t likely to help farmworkers, since their employers likely will seek to reduce weekly hours, switch crops or simply exit the industry.

“They could reduce their operation size or cease farming altogether and sell out,” she said.

Supporters of HB 4002 cast the legislation as a matter of constitutional fairness and noted if an ongoing lawsuit against the agricultural overtime exemption is successful, farmers won’t get assistance to ease the economic blow.

“I believe it’s time to live up to the promise of equal protection of the law,” said Rep. Paul Holvey, D-Eugene. “We owe basic protections to farmworkers and we owe it to farmers not to make a major change to their bottom line without a safety net.”

Before approving HB 4002, the House voted 32-27 against remanding the bill back to a joint committee to consider an amendment favored by Republican lawmakers.

“There is still time to find a more workable solution. An Oregon solution,” said Rep. Shelly Boshart-Davis, R-Albany.

Under that amendment, farmworkers would receive overtime relief payments from the state government after they’d worked more than 40 hours per week.

Meanwhile, farmers would pay workers time-and-a-half overtime wages after a weekly threshold of 48 hours during most of the year and after 55 hours during a 15-week “peak labor period.”

“It is more generous to farmworkers than any other policy,” said Rep. Daniel Bonham, R-The Dalles. “They won’t have their hours cut nearly as much and will still earn overtime wages after 40 hours.”

Holvey said he opposed the amendment because the state overtime payments wouldn’t include contributions to social security insurance, unemployment insurance or worker’s compensation insurance.

Farmworkers also would have to wait up to two months to receive the relief payments from the state government, he said.

The Joint Committee on Farm Worker Overtime thoroughly discussed and rejected the amendment, Holvey said. “Sending the bill back to committee would not end up with a different outcome.”

Under the version of HB 4002 the House passed, the weekly threshold for farmworker overtime would begin at 55 hours next year and incrementally drop to 40 hours in 2027.

Most farms will be divided into three tax credit tiers based on their number of employees:

• Growers employing fewer than 25 workers would qualify for tax credits of 90% of their added overtime payments next year, which would decrease to 60% in 2028, after which they’d expire.

• During that time, the tax credit rate would shift from 75% to 50% for growers with 25 to 50 employees, and from 60% to 15% for farmers with more than 50 workers.

• Dairies would be treated differently due to their round-the-clock need for animal care. Those with fewer than 25 workers would be eligible for a permanent tax credit rate of 100% of overtime payments, while those with more employees would qualify for a rate that incrementally shifts from 75% in 2023 to 50% in 2028, its final year.

Rep. Andrea Valderrama, D-Portland, said lawmakers heard from thousands of farmers and workers while deliberating the bill, but said she was most moved by the testimony of employees.

Farmworkers testified about enduring chemicals, dust and injuries while not having enough money to cover their rent, education and healthcare needs, she said. “Why is it the people who do the most sacred work are the most oppressed, the most exploited?”

Rep. Andrea Salinas, D-Lake Oswego, said the agricultural exemption was created more than 80 years ago at the national level to appease Southern lawmakers who wanted to maintain segregated conditions for Black farmworkers.

“It was not about economics back then, it was about race,” she said.

Rep. Paul Evans, D-Monmouth, said HB 4002 was not the bill he’d hoped for but it will be possible for lawmakers to tweak it as it’s implemented in future years.

“This bill is just the beginning of the conversation,” Evans said.

As lawmakers, it’s their obligation to recognize the equality of human labor and not to tolerate injustice, he said. “We are supposed to confront it, not sweep it under the rug.”