The Ag Law Harvest

By: Jeffrey K. Lewis, Esq. Attorney/Program Coordinator, Income Tax Schools at The Ohio State University

Happy 2024! We hope your new calendar year has gotten off to a delightful start. As we close out the first of twelve months, we bring you another edition of the Ag Law Harvest. In this blog post, we delve into the intricate world of employment contracts and noncompete agreements, classifying workers as independent contractors or employees, Ag-Gag laws, and agricultural policy. 

Ohio Man Violates Employer’s Noncompete Agreement. 

Kevin Ciptak (“Ciptak”), an Ohio landscaping employee, is facing legal trouble for allegedly breaching his employment contract with Yagour Group LLC, operating as Perfection Landscapes (“Perfection”). The contract included a noncompete agreement, which Ciptak is accused of violating by running his own landscaping business on the side while working for Perfection. Perfection eventually discovered the extent of Ciptak’s side business, leading to Perfection filing a lawsuit.

During the trial, Ciptak testified that Perfection was “too busy” to take on the jobs he completed. Additionally, Ciptak stated that the profits from his side jobs amounted to over $60,000. Perfection countered that they would have been able to perform the work and, because of the obvious breach of the noncompete agreement, Perfection lost out on the potential profits. The trial court ruled in favor of Perfection, ordering Ciptak to pay the $60,000 in profits along with attorney’s fees and expenses, exceeding $80,000. Ciptak appealed, arguing that, according to Ohio law, Perfection could only recover its own lost profits, not Ciptak’s gains from the breach. He also claimed that Perfection was not harmed as they were “too busy,” and Perfection failed to provide evidence of lost profits. 

The Eighth District Court of Appeals ultimately found in favor of Perfection.  The court reasoned that “[t]his case came down to a credibility determination.” The court held there was no dispute that Ciptak had violated the noncompete agreement. What was in dispute was whether Perfection could have and would have performed the work. The Eighth District held that the trial court’s finding that Perfection could have performed the work was not unreasonable. The Eighth District noted that although Ciptak claimed that Perfection was “too busy” to do any of those jobs, Ciptak “provided no other evidence to support this assertion.” The Eighth District ruled that the evidence presented at trial showed that Perfection would have realized approximately the same amount of profit on those jobs as Ciptak did and, therefore, Perfection was damaged as a result of Ciptak’s breach of the noncompete agreement. 

New Independent Contractor Rule Announced by Department of Labor. 

The U.S. Department of Labor (“DOL”) has published a final rule to help employers better understand when a worker qualifies as an employee and when they may be considered an independent contractor. The new rule gets rid of and replaces the 2021 rule. As announced by the DOL, the new rule “restores the multifactor analysis used by courts for decades, ensuring that all relevant factors are analyzed to determine whether a worker is an employee or an independent contractor.” Thus, the new rule returns to a “totality of the circumstances” approach and analyzes the following six factors: (1) any opportunity for profit or loss a worker might have; (2) the financial stake and nature of any resources a worker has invested in the work; (3) the degree of permanence of the work relationship; (4) the degree of control an employer has over the person’s work; (5) whether the work the person does is essential to the employer’s business; and (6) the worker’s skill and initiative. The new rule goes into effect on March 11, 2024. 

Federal Appeals Court Reverses Injunctions on Iowa “Ag-Gag Laws.” 

On January 8, 2024, the U.S. Court of Appeals for the Eighth Circuit issued two opinions reversing injunctions against two Iowa “ag-gag laws”. At trial, the two laws were found to have violated the First Amendment of the United States Constitution. In its first opinion, the Eighth Circuit Court of Appeals analyzed Iowa’s “Agricultural Production Facility Trespass” law which makes it illegal to use deceptive practices to obtain access or employment in an “agricultural production facility, with the intent to cause physical or economic harm or other injury to the agricultural production facility’s operations . . .” The Eighth Circuit found that the intent element contained within the Iowa law prevents it from violating the First Amendment. The court reasoned that the Iowa law “is not a viewpoint-based restriction on speech, but rather a permissible restriction on intentionally false speech undertaken to accomplish a legally cognizable harm.” 

In its second opinion, the Eighth Circuit reviewed an Iowa law that penalized anyone who “while trespassing, ‘knowingly places or uses a camera or electronic surveillance device that transmits or records images or data while the device is on the trespassed property[.]’” The court found that the Iowa law did not violate the First Amendment because “the [law’s] restrictions on the use of a camera only apply to situations when there has first been an unlawful trespass, the [law] does not burden substantially more speech than is necessary to further the State’s legitimate interests.”  The court noted that Iowa has a strong interest in protecting property rights by “penalizing that subset of trespassers who – by using a camera while trespassing – cause further injury to privacy and property rights.” 

Both cases have been remanded to the trial courts for further proceedings consistent with the forgoing opinions. 

USDA Announces New Remote Beef Grading Program.

Earlier this month, the U.S. Department of Agriculture (“USDA”) announced a new pilot program to “allow more cattle producers and meat processors to access better markets through the [USDA’s] official beef quality grading and certification.” The “Remote Grading Pilot for Beef” looks to expand on the USDA’s approach to increase competition in agricultural markets for small- and mid-size farmers and ranchers. The pilot program hopes to cut expenses that otherwise deter small, independent meat processors from having a highly trained USDA grader visit their facility. 

Under the pilot program, trained plant employees capture specific images of the live animal and the beef carcass. These images are then sent to a USDA grader that will inspect the images and accompanying plant records and product data, who then assigns the USDA Quality Grade and applicable carcass certification programs. The “Remote Grading Pilot for Beef” is only available to domestic beef slaughter facilities operating under federal inspection and producing product that meets USDA grading program eligibility criteria. More information can be found at https://www.ams.usda.gov/services/remote-beef-grading. 

USDA Accepting Applications for Value-Added Producer Grants Program. 

On January 17, 2024, the U.S. Department of Agriculture (“USDA”) announced that it is “accepting applications for grants to help agricultural producers maximize the value of their products and venture into new and better markets.” These grants are available through the Value-Added Producer Grants Program. Independent producers, agricultural producer groups, farmer or rancher cooperatives, and majority-controlled producer-based business ventures are all eligible for the grants. The USDA may award up to $75,000 for planning activities or up to $250,000 for working capital expenses related to producing and marketing a value-added agricultural product. For more information, visit the USDA’s website or contact your local USDA Rural Development office.

New Year, New Minimum Wage

By: Jeffrey K. Lewis, Attorney and Research Specialist, OSU Agricultural & Resource Law

As 2021 winds down, it is always good to plan for the new year.  Part of that planning includes making sure, as an employer, you are compliant with any updates to current law as we turn the calendars to 2022.  One law that is changing next year, is Ohio’s minimum wage law.  Beginning January 1, 2022, the Ohio minimum wage will rise to $9.30, up from the current $8.80, for non-tipped employees.  However, as an agricultural employer, the law provides some exemptions to paying federal or state minimum wage. In this post, we review minimum wage requirements, agricultural exemptions to minimum wage, and who qualifies for the agricultural exemptions. 

Ohio versus federal minimum wage.  As discussed above, Ohio’s minimum wage will rise to $9.30 for non-tipped employees but federal minimum wage will remain at $7.25.  An agricultural employer is required to follow both state and federal laws, but when the two sets of laws differ, there may be some confusion about which one applies.  Normally, federal law reigns supreme and usually preempts, or overrides, state law.  But in this case, the federal law sets the floor for minimum wage.  This means that employers across the country that are subject to the Fair Labor Standards Act (“FLSA”) cannot pay less than $7.25 per hour to their employees.  However, if a state law requires that employers pay their employees more than the federal minimum wage, then the employer must meet the state’s minimum wage standard.  Thus, Ohio employers must pay the Ohio minimum wage, unless an exemption applies. 

Ohio’s “small employer” exemption. Starting in 2022, Ohio employers that grossed less than $342,000 in 2021 are not required to pay Ohio’s $9.30 minimum wage.  Instead, those employers are required to pay the $7.25 federal minimum wage to their employees, unless another exemption applies. 

Ohio and federal agricultural exemptions.  Under both Ohio and federal law, agricultural employers are exempt from paying the federal or Ohio minimum wage to their employees if any of following apply: 

1. The employer did not use more than 500 man-days of agricultural labor during any calendar quarter during the preceding year. 
2. The employee is the parent, spouse, child, or other member of the employer’s immediate family. 
3. The employee: 
   • is employed as a hand-harvest laborer; 
   • is paid on a piece-rate basis; 
   • commutes daily from their permanent residence to the farm; and 
   • was employed in agriculture for less than 13 weeks during the previous calendar year. 
4. The employee is: 
   • 16 years of age or younger; 
   • employed as a hand-harvest laborer; 
   • paid on a piece-rate basis; 
   • employed on the same farm as their parent or legal guardian; and 
   • paid the same piece-rate wage as employees over the age of 16. 
5. The employee is engaged in range production of livestock. 

500 man-days exemption.  The “man-days” exemption was intended to exempt small and family-sized farms.   A “man-day” is any day during which an employee performs at least one hour of agricultural labor.  To calculate a “man-day”, an agricultural employer needs to keep track of the number of people who worked each day and for how long.  500 “man-days” is roughly equal to having seven employees working for at least one hour each, five days a week during a calendar quarter.  It is also not just full-time employees that are counted towards the 500 “man-day” exemption, temporary and seasonal workers also count towards the “man-day” exemption.  

Family member exemption.  An agricultural employer is not required to pay family members the minimum wage.  This family member exemption applies to employees engaged in agriculture and are either the parent, spouse, child or other member of the employer’s immediate family.  However, not every blood relative is considered “other immediate family.”  According to the U.S. Department of Labor, the following will be considered as part of the employer’s “other immediate family”: stepchildren, foster children, stepparents, and foster parents.  Other family members, including siblings, cousins, nieces, nephews, uncles, and aunts do not count as immediate family members.  

Employed in agriculture.  Ohio law closely resembles, if not mirrors, FLSA requirements when it comes to agricultural exemptions to minimum wage and overtime requirements.  But, to qualify for the agricultural exemptions discussed above, an employer must have employees that are employed in “agriculture.”  Under the FLSA, “agriculture” has two distinct branches, primary agriculture and secondary agriculture.  Employees engaged in primary agriculture are considered to be employed in agriculture for that workweek.  Employees engaged in secondary agriculture are only considered to be employed in agriculture if the activities are performed by a farmer or on a farm in connection with the farming operations.  

What is considered primary agriculture?  Primary agriculture “includes farming in all its branches” and are those activities traditionally viewed as agricultural, including: 

• Cultivating and tilling the soil; 
• Dairying;    
• Producing, cultivating, growing, and harvesting agricultural or horticultural commodities; and 
• Raising livestock, bees, fur-bearing animals, or poultry. 

Activities that qualify as primary agriculture do not necessarily have to take place on a farm.  For example, someone employed in a hatchery that is located in an industrial complex is engaged in a primary agriculture activity (raising poultry) and is considered to be employed in agriculture.  On the other hand, even though an activity takes place on a farm, it does not necessarily mean it is considered to be a primary agriculture activity.  For example, courts have determined that employees of Dairy Farm A are not engaged in a primary agriculture activity when they process milk produced by Dairy Farm B.  

What is secondary agriculture?  Secondary agriculture includes all activities, including forestry or lumbering operations, that may not themselves be considered agricultural practices but are necessary to agriculture.  For an activity to be considered secondary agriculture it must meet two requirements:

1. the activity must either be performed by a farmer or on a farm; and 
2. the activity must be incidental to or in conjunction with such farming operations. 

Secondary agriculture includes preparing an agricultural product for market, delivering agricultural products to storage, to market, or to carriers for transportation to market.  

Any activity that is performed by a farmer’s employees, is also considered to be “performed by a farmer.” Moreover, an activity is considered “incidental to or in conjunction with” farming activities if the work being performed is: 

1. An established part of agriculture; 
2. subordinate to the farming operations of the farm; and 
3. not an independent business. 

Mixing it up.  After understanding what work is considered agricultural, it is important to understand the impact of an employee performing both exempt and non-exempt work.  If an employee does both exempt and non-exempt work in the same week, then the employee loses their exemption status and must be paid according to federal/Ohio minimum wage and overtime requirements.  However, if an employer can separate the employee’s exempt and non-exempt work into separate weeks, then the employer would only have to pay the employee federal/Ohio minimum wage and overtime for those weeks that the employee performed non-exempt work.  

This especially important to agricultural employers that also engage in agritourism activities.  Having a farm employee perform work related to an agritourism activity does not qualify for the agricultural exemptions under federal/Ohio law.  Agricultural employers should be careful when assigning their employees tasks.  Assigning tasks outside the realm of agriculture will subject the employer to the provisions of federal and state minimum wage and overtime laws.

Overtime.  Agricultural employers are exempt from paying their agricultural employees an overtime wage rate.  This exemption applies to all agricultural employees, not just small farm employees or immediate family members.  

Conclusion.  Determining whether your employees qualify for an agricultural exemption can be a complex issue, with multiple layers of analysis.  It is always best to ask an attorney to help clarify whether your employees are considered to be “employed in agriculture” and thus qualify for the agricultural exemptions to minimum wage and overtime laws.  Further, it is always a good idea to seek a lawyer’s counsel every so often to help make sure your operation is continuing to be compliant with labor and employment laws.  

References and Resources. 

29 U.S. Code Chapter 8 – Fair Labor Standards, https://www.law.cornell.edu/uscode/text/29/chapter-8

29 U.S. Code § 206 – Minimum wage, https://www.law.cornell.edu/uscode/text/29/206

29 CFR Chapter 5 – Wage and Hour Division, Department of Labor, https://www.ecfr.gov/cgi-bin/text-idx?SID=9215c26baf64464cdfbd4073e46247d3&mc=true&tpl=/ecfrbrowse/Title29/29chapterV.tpl

29 C.F.R. §§ 780 et seq. – Exemptions Applicable to Agriculture, https://www.ecfr.gov/cgi-bin/text-idx?SID=09461535e9555139c7d6471d1b26598d&mc=true&node=pt29.3.780&rgn=div5#se29.3.780_1103

Ohio Constitution, Article II, Section 34 – Minimum Wage, https://codes.ohio.gov/ohio-constitution/section-2.34a

Ohio Department of Commerce, 2022 Minimum Wage Poster, https://www.com.ohio.gov/documents/dico_2022MinimumWageposter.pdf

Ohio Revised Code Chapter 4111 – Minimum Fair Wage Standards, https://codes.ohio.gov/ohio-revised-code/chapter-4111

U.S. Department of Labor Wage and Hour Division, Field Operations Handbook Chapter 20 – Agriculture: Related and Seasonal Exemptions, https://www.dol.gov/sites/dolgov/files/WHD/legacy/files/FOH_Ch20.pdf

U.S. Department of Labor Wage and Hour Division, Fact Sheet #12: Agricultural Employers Under the Fair Labor Standards Act (FLSA), https://www.dol.gov/sites/dolgov/files/WHD/legacy/files/whdfs12.pdf

Help Wanted: Recruiting During a Labor Shortage

By: Jeffrey K. Lewis, Attorney and Research Specialist, OSU Agriculture and Resource Law

Over the past few months, we have all heard about the labor shortage affecting American employers in various industries all over the country.  Now is as difficult a time as ever to find employees.  As an agricultural employer, it may be easy to relax some of your established policies and procedures when going through the employee recruitment process, especially while navigating the labor shortage.  But, as an employer, you are obligated to comply with state and federal law regardless of the labor climate.  Below we review a few important concepts to help refresh employers of their obligations under Ohio and federal law when they engage in the recruitment process. 

Walking the fine line of job descriptions.  One of the first thing an employer should do when beginning the recruitment process is to define the job qualifications in order to identify the minimum qualifications an employer is willing to accept in a new employee.  However, some care should be taken in this step.  If an employer has unrealistic expectations, it may make it difficult to fill the position.  Then, out of frustration or urgency, an employer will fill the position with someone that does not meet the stated minimum qualifications.  This creates a problem if an employer ends up hiring an employee that does not meet the minimum qualifications after previously rejecting other applicants with similar qualifications.  Those rejected applicants may have a lawsuit for employment discrimination.  On the other hand, if an employer’s written expectations are too low, an employer may have a difficult time defending its decision to reject an individual who met the stated minimum qualifications while the employer searched for someone who met what the employer was really looking for.  An employer needs to be consistent and stick to its stated qualifications when making employment decisions or risk opening itself up to employment discrimination lawsuits.  

Defining the essential functions of the job is essential.  Creating a comprehensive and detailed job description and a list of job qualifications helps employers narrow its applicant pool and provides a basis to make certain employment decisions.  It also helps employers define the essential functions of a job which helps employers stay compliant with Ohio and federal employment laws.  For example, The American with Disabilities Act (“ADA”) makes it clear that an employer does not need to employ someone who cannot perform the essential functions of the job.  This does not mean that every function performed by an employee is “essential.”  The Equal Employment Opportunity Commission (“EEOC”) makes it clear that marginal functions of the job are not “essential.”  Some of the factors that help determine what functions are essential include: 

• The employer’s judgment as to which functions are essential; 
• Written job descriptions prepared before advertising or interviewing applicants; 
• The amount of time spent on the job performing the function; and 
• The consequences of not requiring the employee to perform the function.    

Job Applications.  Most employers understand it is unlawful to discriminate against employees or potential employees based on race, religion, sex, national origin, age, or disability.  On job applications, however, employers need to be careful when asking what may seem like innocent questions that relate to things like age, religion, national origin, marital status, children, criminal history, U.S. citizenship, medical history, or disability.  Asking these types of questions may lead to a finding that an employer engaged in a discriminatory practice.  For example, it is permissible to ask if an applicant is legally permitted to work in the United States; it is impermissible to ask where someone was born.  It is permissible to ask if someone is able to perform the essential functions of the job; it is impermissible to ask if someone has any health issues that would prevent them from doing the job.  These are just a couple examples of the types of questions an employer is allowed to ask on an application.  Employers should consult with an attorney to make sure that all questions on an application are compliant with state and federal standards.  

Pre-employment drug and alcohol testing.  There are no laws that prohibit employers from testing its employees for drugs and alcohol.  However, there are laws that regulate the timing of such tests.  To help employers, the ADA separates testing into two categories, “pre-offer” testing and “post-offer” testing.  In the pre-offer stage, an employer may test a potential employee for any illegal drug use but cannot test for alcohol.  Illegal drug use is not protected under the law.  However, employers need to be careful from automatically disregarding all employees that test positive for controlled substances.  A person with chronic back pain may have a perfectly legal reason for having certain substances in their system, especially if they are under a strict pain management program.  Once an employer learns of an employee’s legal justifications for certain controlled substances, an employer cannot use the information as basis to refuse employment, terminate, or discipline an employee.  In the post-offer stage, employers are allowed to test for alcohol.  Testing for alcohol is considered a medical examination, and employers are only allowed to subject their employees to medical examinations once an offer of an employment has been given.  Regardless of which type of testing an employer seeks to use, employers must be consistent in the way they implement such testing.  Testing must be done in a non-discriminatory manner, meaning an employer must make all employees take the same test or forgo any testing at all. 

Background Checks.  Ohio does not prohibit the use of background or credit checks on potential employees.  There are, however, several regulations that relate to employers that use background or credit checks.  First, background and credit checks are subject to the federal Fair Credit Reporting Act (“FCRA”) which requires employers to obtain written consent from the applicant, give the applicant notice of the employer’s intention to reject their application based on the results of the background check, and notify the applicant of any final decision to reject the applicant because of the background check.  Additionally, employers need to be careful about how they handle prior arrests and convictions.  If an employer does decide to reject an application based on any prior arrests or convictions, the employer needs to consider the nature of the job, the nature and severity of the offense, and how much time has passed since the offense.  For example, if a farmer is looking to hire a general farm laborer, a conviction for driving under the influence from 10 years ago may not be sufficient grounds to reject an application.  Unless the position requires the applicant to drive on a consistent basis, the offense may not really be related to the nature of the job.  Furthermore, enough time may have passed that would make it discriminatory to reject an application for this type of offense.  

Interviewing.  Interviews are ripe for potential discrimination claims because they are less structured than applications and insert the “human element.”  When conducting an interview, employers should stick to a script.  A script will help an employer avoid potential discrimination lawsuits and gives the employer the ability to carefully select its interview questions.  When asking questions, an employer is not liable for any information that an applicant willingly provides.  For example, if the questions is “tell me about yourself” and an applicant provides information about a medical condition or their family, an employer cannot be found liable for any discriminatory practices.  An employer cannot, however, use the information to make any employment decisions.  If an applicant is providing too much information, it is best for the employer to quickly move on to the next subject to avoid eliciting any other information that could be used against an employer in a discrimination lawsuit.   

Hiring.  When deciding to choose one applicant over another, employers need to have a fair and equal system in place.  Employers need to be able to point to a specific procedure that demonstrates an employer’s nondiscriminatory reason for choosing on applicant over another.  For example, if one applicant is more qualified than another for a job, it is easy to prove a nondiscriminatory purpose for hiring the more qualified candidate.  If there are two equally qualified candidates, it is even more important to have a nondiscriminatory procedure in place when deciding between the two applicants. For example, an employer could have a policy in place that states if two equally qualified candidates apply for the same position, the candidate that applies first shall be given the job offer.  

New hire reporting.  All employers are required by the U.S. Customs and Immigration Services to verify the identity and employment eligibility of all employees by filing out Form I-9.  Ohio employers are also required by the Ohio Department of Family and Job Services (“ODFJS”) to report the hiring, rehiring, and return to work of paid employees.  The new hire report must be completed within 20 days after the employee is hired or returned to work.  

Conclusion.  In these trying and difficult times, compliance with state and federal regulations may be the last thing on an employer’s mind.  However, these laws are always in effect, regardless of circumstance.  Complying with state and federal laws will only help employers defend any employment decisions and to avoid potential employment discrimination lawsuits. 

References and Resources

Ohio Revised Code Chapter 4112 – Civil Rights Commission

Americans with Disability Act, 42 U.S.C. §§ 12101-12117

Title VII of the Civil Rights Act, 42 U.S.C. § 2000e et seq.

The Ag Law Harvest

By:Jeffrey K. Lewis, Attorney and Research Specialist, OSU Agricultural & Resource Law 

Did you know that the Nile Crocodile has the strongest bite of any animal in the world?  The deadly jaws can apply 5,000 pounds of pressure per square inch, which is about 10 times more powerful than the crunch of the Great White Shark. Humans?  Well, they can apply about 100 pounds of pressure per square inch.  

This edition of the Ag Law Harvest takes a bite out of some federal lawsuits, Department of Labor developments, and USDA announcements affecting agriculture and the environment. 

Animal advocates lack standing to sue poultry producer.  In 2020, animal advocacy groups In Defense of Animals (“IDA”) and Friends of the Earth (“FoE”) (collectively the “Plaintiffs”) filed a lawsuit against Sanderson Farms (“Sanderson”), a Mississippi poultry producer, alleging that Sanderson engaged in false advertising as it relates to its chicken products.  According to Plaintiffs, Sanderson advertises that its chickens are “100% natural” with no “hidden ingredients.”  However, Plaintiffs allege that Sanderson has been misleading the public after many of Sanderson’s products tested positive for antibiotics and other unnatural substances.  This however is not the first court battle between FoE and Sanderson.  In 2017, FoE sued Sanderson for the same false advertising.  However, the 2017 case was dismissed because the court held that FoE did not have standing to bring the lawsuit.  The 2017 case was appealed to the Ninth Circuit Court of Appeals where the decision to dismiss the lawsuit was upheld.  Fast forward to 2020, FoE joined forces with a new plaintiff, IDA, hoping to file a lawsuit that would finally stick.  Recently however, a federal district court in California dismissed the most recent lawsuit because FoE was precluded, or prohibited, from suing Sanderson again on the same claims and because IDA lacked the standing to bring the lawsuit.  The California district court found that FoE could not bring its claims against Sanderson because those same claims were litigated in the 2017 lawsuit.  This legal theory, known as issue preclusion, prevents the same plaintiff from a previous lawsuit from bringing the same claims against the same defendant in a new lawsuit, when those claims were resolved or disposed of in a prior lawsuit.  Issue preclusion did not affect IDA, however, because it was a new plaintiff.  But the California district court still found that IDA lacked standing to bring this lawsuit against Sanderson.  IDA argued that because it expended resources to launch a campaign against Sanderson to combat the allegedly false advertising, it had organizational standing to bring the lawsuit.  Standing requires a plaintiff to show they suffered an “injury-in-fact” before they can maintain a lawsuit.  Organizational standing is the theory that allows an organization like IDA to establish an “injury-in-fact” if it can demonstrate that: (1) defendant frustrated its organizational mission; and (2) it diverted resources to combat the defendant’s conduct.  IDA argued that because it diverted resources including writing letters to Sanderson and the Federal Trade Commission, filing a complaint with the Better Business Bureau, publishing articles and social media posts, and diverting staff time from other campaigns to focus on countering Sanderson’s advertising, it had the organizational standing to bring the lawsuit.  The Court disagreed.  The Court reasoned that the diverting of resources by IDA was totally voluntary and not a result of Sanderson’s advertising.  The Court determined that in order to obtain organizational standing, IDA must have been forced to take the actions it did as a result of Sanderson’s advertising, the diverting of resources cannot be self-inflicted.  The Court held that Sanderson’s advertising did not ultimately frustrate IDA’s organizational mission and that any diverting of resources to counter Sanderson’s advertising was the normal course of action taken by a group like IDA.  

Joshua trees, a threatened species?  WildEarth Guardians (“Plaintiff”), a conservation organization, brought suit against the U.S. Secretary of the Interior and the U.S. Fish and Wildlife Service (“Defendants”) for failing to list the Joshua tree as a threatened species under the Endangered Species Act (“ESA”).  Plaintiff argued that the Defendants’ decision not to list the Joshua tree as threatened was arbitrary, capricious, contrary to the best scientific and commercial data available, and otherwise not in line with the standards set forth by the ESA.  In 2015 Plaintiff filed a petition to have the Joshua tree listed as a threatened species after Plaintiff provided scientific studies showing that climate change posed a serious threat to the continued existence of the Joshua tree.  The U.S. Fish and Wildlife Service (“FWS”) issued a 90-day finding that Plaintiff’s petition presented credible information indicating that listing the Joshua tree as threatened may be warranted.  However, the FWS’s 12-month finding determined that listing the Joshua tree as threatened or endangered under the ESA was not necessary due to the Joshua tree’s long lifespan, wide range, and ability to occupy multiple various ecological settings.  That’s when Plaintiff decided to bring this lawsuit asking the federal district court in California to set aside the 12-month finding and order the Defendants to prepare a new finding, and the Court agreed.  The Court held that Defendants’ decision was arbitrary, capricious, and contrary to the ESA and ordered the Defendants to reconsider Plaintiff’s petition.  The Court reasoned that the FWS’s climate change conclusions were arbitrary and capricious because it failed to consider Plaintiff’s scientific data and failed to explain why in its 12-month finding.  Further, the Court noted that the FWS’s findings regarding threats to the Joshua tree posed by climate change and wildfire were unsupported, speculative, or irrational.  And finally, the Court determined that the FWS’s conclusion that Joshua trees are not threatened in a significant portion of their range was arbitrary and capricious.  The FWS must now prepare a new finding that addresses all the above deficiencies.  

Department of Labor announces expanded measures to protect workers from extreme heat.  The U.S. Department of Labor (“DOL”) announced that the Occupational Safety and Health Administration (“OSHA”) is working on ways to protect workers in hot environments and reduce the dangers associated with exposure to high heat.  According to the DOL, OSHA will be implementing an enforcement initiative on heat-related hazards,  developing a National Emphasis Program on heat inspections, and launching a rulemaking process to develop a workplace heat standard.  Current and future extreme heat initiatives and rules apply to indoor and outdoor worksites in general industry, construction, agriculture and maritime where potential heat-related hazards exist. 

Deadline to apply for pandemic assistance to livestock producers extended.  The USDA announced that it is providing additional time for livestock and poultry producers to apply for the Pandemic Livestock Indemnity Program (“PLIP”).  Producers who suffered losses during the Covid-19 pandemic due to insufficient access to processing may now apply for relief for those losses through October 12, 2021.  Payments are based on 80% of the fair market value of the livestock and poultry and for the cost of depopulation and disposal of the animals.  Eligible livestock include swine, chickens, and turkeys.  For more information on PLIP, and how to apply, visit farmers.gov/plip.

Employee v. Independent Contractor: When is an Ag Employer Responsible?

By: Jeffrey K. Lewis, Attorney and Research Specialist, OSU Agricultural & Resource Law 

Agricultural workers are usually categorized in two ways.  They are either an “employee” or an “independent contractor.”  Depending on how an agricultural worker is labeled determines the duties and liabilities of the agricultural employer.  

Generally speaking, if an ag employer has the right to control the work of an ag worker, then the ag worker is probably an employee.  This means that the ag employer must abide by a whole host of federal and state laws that relate to labor and employment and can be found liable for any damages caused by their employees under the doctrine of vicarious liability.  Vicarious liability is a legal doctrine that may hold an employer responsible for the actions of an employee — so long as the employee was acting in the ordinary course of business.  A good example of the vicarious liability doctrine in action is when a court decides to hold a farmer and/or farm business responsible for any spray drift damages resulting from an employee’s application of herbicide. 

On the other hand, ag employers that use independent contractors are usually not liable for any damages that result from the actions of an independent contractor.  This obviously makes the use of independent contractors very appealing but comes at a higher cost than using an employee to do the work.   

Simple enough right? Be careful with employees and spray drift or use independent contractors and be worry free.  Not really.  Although a big concern for ag employers are the liability issues that stem from employees’ actions, having employees requires ag employers to fulfill multiple obligations under state and federal labor and employment laws, obligations that otherwise would not exist if an ag employer used an independent contractor to complete the work.  Those obligations can include wages, overtime pay, hour restrictions, migrant and seasonal worker protections, tax concerns, and others.  So, you see, labeling a worker as an employee or independent contractor goes far beyond just preventing a lawsuit against the ag employer.  

Ag employers often think they are using independent contractors to complete work around the farm.  But innocently, the ag employer may actually be using an employee to complete work around the farm and is probably violating federal and state law and exposing itself to fines and lawsuits.  An ag employer must be careful when determining who is an employee and who is an independent contractor when looking for help on the farm.  Below is a brief summary of Ohio and federal law that determine when an ag worker is an employee and when an ag worker is an independent contractor.  

How do I determine who is an employee and who is an independent contractor? 

The simple answer to that is, it depends.  Different tests are used at the federal level and in Ohio.  However, one thing that all these tests have in common is the ag employer’s right to control the work being done.  This means that if an ag employer can direct, monitor, correct, or otherwise control how the work is being done, then the ag worker is likely an employee.  Even if an ag employer never exerts or directly controls how the work is being done, courts only care that the ag employer has or had the ability to do so. 

What are the tests to determine if a worker is an employee or independent contractor?

The Economic Realities Test.  The Fair Labor Standards Act (“FLSA”) is the federal law that governs minimum wage, overtime pay, recordkeeping, and youth employment standards.  “Employee” is defined very broadly under the FLSA and more often than not, a worker is found to be an employee rather than an independent contractor.  To help determine who is an employee and who is an independent contractor, the FLSA uses an Economic Realities Test.  The Economic Realities Test looks at the reality of the economic relationship between the parties and if a worker is more reliant on the employer for economic gain and security, then the worker is more likely an employee.  Factors under this test include: 

1. The degree of control that an employer can exert over the worker and the work being performed.  
2. Whether the work being performed is an integral part of the employer’s business. 
3. The permanency of the relationship. 
4. The amount of the worker’s investment in facilities and equipment.  
5. The worker’s opportunities for profit and loss.  
6. The amount of initiative, judgment, foresight, and skill required for the worker’s success.  

The Internal Revenue Service (“IRS”) Standard.  The IRS has a separate test to help taxpayers determine whether an individual should be considered an employee or independent contractor for tax purposes.  The IRS analyzes three areas – behavioral control, financial control, and the relationship of the parties.  

1. Behavioral Control – a worker is an employee when the business has the right to direct and control the work performed.  Factors include: (a) the type of instructions given; (b) degree of instruction given; (c) evaluation of work done; and (d) training. 
2. Financial Control – If a business has the right to direct or control the financial and business aspects of the worker’s job, then the worker is likely in employee.  A major factor is how the worker is paid.  Employees are guaranteed regular pay whereas independent contractors are paid by the job. 
3. Relationship of parties – the IRS takes into consideration what the parties think their relationship is.  The IRS will look at written contracts, whether any benefits are offered, the length and permanency of the relationship, and whether the worker is performing work that is an integral part of the business of the employer.  

Ohio’s standard.  Ohio uses two separate, yet very similar tests to determine employee or independent contractor status.  For wage and hour purposes, Ohio uses the Economic Realities Test that is used by the FLSA.  

However, for workers’ compensation, unemployment insurance, and Ohio’s vicarious liability law, Ohio uses a “right to control” test.  Under Ohio’s “right to control” test courts consider the following factors: 

1. Whether the worker is engaged in a distinct occupation or business; 
2. Whether the worker or the employer supplies the place and tools to complete the work; 
3. Whether the work is done by a specialist requiring a particular skill; 
4. How the worker is paid; 
5. The length of time a worker is employed; 
6. Whether the work performed is part of the regular business of the employer; 
7. Whether the employer controls the details and quality of the work to be performed; and 
8. The terms of any agreements or contracts between the parties.  

Why is determining who is an employee and independent contractor important? 

First and foremost, determining who is and is not an employee defines an ag employer’s obligations under the law.  If an ag employer has employees, then the ag employer must abide by federal and state wage, hour, antidiscrimination, unemployment insurance, workers compensation, and safety laws.  Those same obligations do not arise when using an independent contractor. 

Secondly, misclassifying a worker as an independent contractor when they are actually an employee can lead to severe legal fines and penalties.  Some of the consequences for incorrectly classifying a worker could include: 

• Lawsuits for unpaid wages; 
• Fines for failing to comply with federal and Ohio antidiscrimination laws; 
• Discrimination and wrongful termination claims; 
• Lawsuits for the negligence or other civil wrongs of the worker; and
• Fines for failing to maintain Ohio Workers’ Compensation Insurance and Unemployment Insurance. 

Conclusion.  Determining who is and isn’t an employee defines an ag employer’s legal obligations, so it is always important to ensure that whenever someone is doing work for you, you categorize them correctly.  If you have any doubts, it’s always best to air on the side of caution and treat a worker as an employee.  If you should have any questions contact your attorney to help you determine what your legal obligations are as an employer, it can save you time, money, and stress.  

To learn more about distinguishing between an employee and an independent contractor visit: 

U.S. Department of Labor Wage and Hour Division, Fact Sheet 13: Employment Relationship Under the Fair Labor Standards Act (FLSA)

U.S. Department of Labor Wage and Hour Division, Fair Labor Standards Act Advisor: Independent Contractors

U.S. Department of Labor Wage and Hour Division, Misclassification of Employees as Independent Contractors

U.S. Internal Revenue Service, Understanding Employee vs. Contractor Designation

Ohio Administrative Code § 4141-3-05, Definition of Employment

Agriculture loses more cases than it wins in recent federal decisions

Perhaps it’s an overused phrase but “sometimes you win, sometimes you lose” has relevance to agriculture lately.  It’s a fitting response to several new decisions from the federal courts.  Some of the decisions align with positions advocated by agricultural interests but others do not.  We wrote last week about a case in the “sometimes you lose” category–the Court’s ruling in favor of small refineries claiming exemptions from renewable fuels mandates.  Several members of Congress have already proposed legislation that would nullify the Court’s decision in that case.  A second loss came with a challenge to California’s animal welfare standards and a third with the court striking down a waiver of E15 ethanol blends.  The sole win came with a challenge to a California statute allowing union organizing activities on private property.  Here’s a summary.

California Proposition 12 – North American Meat Institute v. Bonta

The U.S. Supreme Court announced that it would not grant certiorari and review a decision by the Ninth Circuit Court of Appeals’ on California Proposition 12.  Voters approved Proposition 12, the “Prevention of Cruelty to Farm Animals Act,” in 2018.  The Act establishes housing standards for egg-laying hens, breeding hogs and veal calves and prohibits the confinement of animals in spaces that don’t meet the standards.  Business owners and operators in California may not sell meat or egg products from animals that are not confined according to the standards.  Standards for calves (43 square feet) and egg laying hens (1 square foot) became effective in 2020 while standards for breeding pigs and their offspring (24 square feet) and cage-free provisions for egg laying hens are to be effective beginning January 1, 2022.

The North American Meat Institute (NAMI) sought a preliminary injunction against Proposition 12 in 2019, arguing that it violates the Interstate Commerce Clause of the U.S. Constitution, which grants only Congress the authority to regulate commerce among the states.  NAMI claimed that the Act establishes a “protectionist trade barrier” that would protect California producers from out-of-state competition and control conduct outside of its state borders. 

Both the federal District Court and the Ninth Circuit Court of Appeals disagreed with NAMI.   The appellate court affirmed the District Court’s conclusions that Proposition 12 is not discriminatory on its face and does not have a discriminatory purpose or effect, as there was no evidence that the state had a protectionist intent and the Act treats in-state and out-of-state producers the same.  Nor does the Act try to directly regulate out-of-state conduct or impose burdens on out-of-state producers, but instead only precludes sale of meats resulting from certain practices, the courts concluded.  The federal government and 20 states joined NAMI in a request for a rehearing of the case by the full panel of judges on the Ninth Circuit but were unsuccessful.

NAMI turned to the U.S. Supreme Court, seeking a review of the case on the basis that the Ninth Circuit’s decision conflicts with holdings by other appellate courts and the U.S. Supreme Court.  The Supreme Court denied the request for review on June 28, offering no explanation for its decision.  The legal challenges to Proposition 12 do not end with that denial, however.  A separate case filed by the National Pork Producers Association and American Farm Bureau Federation is pending before the Ninth Circuit Court of Appeals.  It also argues that Proposition 12 negatively impacts interstate commerce and will increase consumer costs for pork and that the federal district court judge who dismissed the case failed to examine the practical effects the law would have on producers.  The Ninth Circuit heard the appeal in April, so we may see a decision in the next few months.

E15 waiver:  American Fuel & Petrochemical Manufacturers v. EPA

The D.C. Circuit Court of Appeals held in favor of a claim by the American Fuel and Petrochemical Manufacturers (AFPM) challenging a Trump Administration rule in 2019 that waived restrictions on summer sales of E15 due to higher fuel volatility in summer temperatures.  The decision could mean that current sales of E15 must end unless further legal challenges follow.

The 2019 Reid Vapor Pressure (RVP) waiver for E15 allowed fuel stations to sell 15% ethanol blends during the summer months rather than limiting those sales to 10% ethanol, a move that would increase ethanol sales.   As expected, the oil and gas refining industry responded to the waiver issuance with a legal challenge, arguing that the administration lacked the authority to grant the RVP waiver for fuels over 10% ethanol. 

The volatility waiver authority derives from the Clean Air Act, which establishes when the EPA may alter volatility limits through the waiver process and specifically allows the EPA to grant an ethanol waiver for “fuel blends containing gasoline and 10 percent denatured anhydrous ethanol” in Section 745(h)(4).  The EPA relied upon the ethanol waiver language in the Clean Air Act back in 1992 to waive volatility standards for E10.  But whether the EPA could use the Clean Air Act language to issue a waiver for ethanol beyond 10 percent is the question at the heart of the dispute.  The EPA and intervenors in the case representing biofuel interests claimed the language was ambiguous enough to allow the EPA to grant waivers for fuel with 10% ethanol or more.

In a unanimous decision, the Court of Appeals concluded that “the text, structure, and legislative history” of the Clean Air Act do not allow EPA to extend a waiver to E15.  The court found the statutory language straightforward, lacking any modifiers that would establish a range of ethanol blends rather than the 10 percent stated in the statute.  Legislative actions at the time also supported an interpretation that the 10 percent language addressed E10 and not ethanol blends in excess of 10 percent. 

The next critical question for this case is what the Biden Administration EPA will do with case and the E15 waiver.  A request for further review of the D.C. Circuit’s opinion is possible.  Or perhaps the EPA will pursue a legislative fix that increases the statutory reference from 10 percent to 15 percent ethanol.  And it’s always possible that no further action will occur and E15 summer sales will no longer be an option.

Union organizer access as a taking – Cedar Point Nursery v Hassid

In the “win” column for agricultural employers is a case that asks whether a state regulation granting access to private property for union activities is a “taking” of property under the Constitution.  The U.S. Supreme Court’s answer to the question is “yes,” although three of the Justices dissented from the majority opinion. 

A regulation formed under the California Agricultural Labor Relations Act of 1975 gives labor organizations a “right to take access” to an agricultural employer’s property “for the purpose of meeting and talking with employees and soliciting their support.”  The regulation requires agricultural employers to allow union organizers to be on the property up to three hours per day and four 30-day periods per year but cannot be “disruptive” and must provide written notice to employers.   An employer who interferes with the organizers can be subject to sanctions. 

After representatives from United Farm Workers accessed Cedar Point Nursery and engaged in disruptive conduct and sought to access Fowler Packing Company, both occasions without notice to the employers, the companies filed a lawsuit seeking an injunction from the federal District Court.  They argued that the regulation was a physical taking of their properties because it granted an easement to the union organizers, which required compensation under the Fifth and Fourteenth amendments of U.S. Constitution.

The District Court did not grant the injunction and held that the regulation is not a physical taking because it doesn’t allow the public a permanent and continuous right of access to the property for any reason.  The Ninth Circuit Court of Appeals affirmed that decision, agreeing that it wasn’t a physical taking, but a strong dissent argued that the union activities were a physical occupation and taking of property.  The agricultural companies sought but were denied a hearing before all of the Ninth Circuit judges, leading to a request for review granted by the U.S. Supreme Court.

The majority of the Justices concluded that the California regulation is a physical taking because it grants union organizers a right to invade an agricultural employer’s property.  Particularly important to the majority was the regulation’s removal of an owner’s right to exclude people from their private property, which is a “fundamental element” of property rights according to the Court.  The Court rejected the argument that the access must be continuous and permanent to be a physical taking and dispensed with claims that the holding could endanger regulations that allow government entries onto private land.  The Court’s holding was clear:  the access regulation amounts to simple appropriation of private property.

Read the court opinions in these three cases here:

Ninth Circuit’s Opinion North American Meat Institute v. Becerra/Bonta

American Fuel & Petrochemical Manufacturers v. EPA

Cedar Point Nursery v. Hassid

Ohio Ag Law Blog–The Ag Law Harvest

Written by: Ellen Essman and Peggy Hall

October is almost over, and while farmers have thankfully been busy with harvest, we’ve been busy harvesting the world of ag law.  From meat labeling to RFS rules to backyard chickens and H-2A labor certification, here’s our latest gathering of agricultural law news you may want to know:

Federal judge upholds Missouri’s meat labeling law—for now.  Missouri passed a law in 2018, which among other things, prohibited representing a product as “meat” if it is not derived from livestock or poultry.  As you can imagine, with the recent popularity of plant-based meat products, this law is controversial, and eventually led to a lawsuit.  However, U.S. District Judge Fernando Gaitan Jr. decided not issue a preliminary injunction that would stop the Missouri Department of Agriculture from carrying out the labeling law.  He reasoned that since companies like Tofurky, who brought the suit, label their products as plant-based or lab-grown, the law does not harm them.  In other words, since Tofurky and other companies are not violating the law, it doesn’t make sense to stop enforcement on their account. Tofurky, the American Civil Liberties Union, and the good Food Institute have appealed Judge Gaitan’s decision, asserting that Missouri’s law infringes upon their right to free speech.  This means that the Missouri law can be enforced at the moment, but the decision is not final, as more litigation is yet to come.

Oregon goes for cage-free egg law.   In August, Oregon passed a new law that would require egg-laying chickens, turkeys, ducks, geese, or guinea fowl to be kept in a “cage-free housing system.” This law will apply to all commercial farms with more than 3,000 laying hens.  A cage-free housing system must have both indoor and outdoor areas, allow the hens to roam unrestricted, and must have enrichments such as scratch areas, perches, nest boxes and dust bathing areas.  As of January 1, 2024, all eggs sold in the state of Oregon will have to follow these requirements for hens.  The law does allow hens to be confined in certain situations, like for veterinary purposes or when they are part of a state or county fair exhibition.

City can ban backyard chickens, says court.   The Court of Appeals for Ohio’s Seventh District upheld the city of Columbiana’s ordinances, which ban keeping chickens in a residential district, finding that they were both applicable to the appellant and constitutional. In this case, the appellant was a landowner in Columbiana who lived in an area zoned residential and kept hens in a chicken coop on his property.  The appellant was eventually informed that keeping his hens was in violation of the city code.  A lawsuit resulted when the landowner would not remove his chickens, and the trial court found for the city. The landowner appealed the trial court’s decision, arguing that he did not violate the city ordinances as they were written, and that the city applied the ordinances in an arbitrary and unreasonable way because his chickens did not constitute a nuisance. Although keeping chickens is not explicitly outlawed in Columbiana, the Court of Appeals for Ohio’s Seventh District found that reading the city’s zoning ordinances all together, the “prohibition on agricultural uses within residential districts can be inferred.”  Furthermore, the court pointed out that the city’s code did not ban chickens in the whole city, but instead limited them to agricultural districts, and that the prohibition in residential areas was meant to ensure public health.  For these reasons, the court found that the ordinances were not arbitrarily and unreasonably applied to the appellant, and as a result, the ordinances are constitutional.  To read the decision in its entirety, click here.

EPA proposes controversial Renewable Fuel Standard rule.   On October 15, EPA released a notice of proposed rulemaking, asking for more public comment on the proposed volumes of biofuels to be required under the Renewable Fuel Standard (RFS) program in 2020.  The RFS program “requires a certain volume of renewable fuel to replace the quantity of petroleum-based transportation fuel” and other fuels.  Renewable fuels include biofuels made from crops like corn, soybeans, and sugarcane.  In recent years, the demand for biofuels has dropped as the Trump administration waived required volumes for certain oil refiners.  The administration promised a fix to this in early October, but many agricultural and biofuels groups feel that EPA’s October 15 proposed rule told a different story. Many of these groups are upset by the proposed blending rules, claiming that way the EPA proposes calculate the biofuel volumes would cause the volumes to fall far below what the groups were originally promised by the administration. This ultimately means the demand for biofuels would be less.  On the other hand, the EPA claims that biofuels groups are misreading the rule, and that the calculation will in fact keep biofuel volumes at the level the administration originally promised. The EPA plans to hold a public hearing on October 30, followed by a comment period that ends November 29, 2019.  Hopefully the hearing and comments will help to sort out the disagreement. More information is available here, and a preliminary version of the rule is available here.

New H-2A labor certification rule is in effect.    The U.S. Department of Labor has finalized one of many proposed changes to the H-2A temporary agricultural labor rules.  A new rule addressing labor certification for H-2A became effective on October 21, 2019.  The new rule aims to modernize the labor market test for H-2A labor certification, which determines whether qualified American workers are available to fill temporary agricultural positions and if not, allows an employer to seek temporary migrant workers.   An employer may advertise their H-2A job opportunities on a new version of the Department’s website, SeasonalJobs.dol.gov, now mobile-friendly, centralized and linked to third-party job-search websites.  State Workforce Agencies will also promote awareness of H-2A jobs.  Employers will no longer have to advertise a job in a print newspaper of general circulation in the area of intended employment. For the final rule, visit this link.

And more rules:  National Organic Program rule proposals.  The USDA has also made two proposals regarding organic production rules.  First is a proposed rule to amend the National List of Allowed and Prohibited Substances for organic crops and handling.  The rule would allow blood meal made with sodium citrate to be used as a soil amendment, prohibit the use of natamycin in organic crops, and allow tamarind seed gum to be used as a non-organic ingredient in organic handling if an organic form is not commercially available.  That comment period closes on December 17, 2019.  Also up for consideration is USDA’s request to extend the National Organic Program’s information collection reporting and recordkeeping requirements, which are due to expire on January 31, 2020.  The USDA’s Agricultural Marketing Service specifically invites comments by December 16, 2019 on:  (1) whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency’s estimate of the burden of the proposed collection of information including the validity of the methodology and assumptions used; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on those who are to respond, including the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology.

Great Lakes restoration gets a boost from EPA.  On October 22, 2019, the EPA announced a new action plan under the Great Lakes Restoration Initiative (GLRI).  The plan will be carried out by federal agencies and their partners through fiscal year 2024.  Past GLRI action plans have removed environmental impairments on the lakes and prevented one million pounds of phosphorus from finding its way into the lakes.  The plans are carried out by awarding federal grant money to state and local groups throughout the Great Lakes, who use the money to carry out lake and habitat restoration projects.  Overall, the new plan’s goals are to remove toxic substances from the lakes, improve and delist Areas of Concern in the lakes, control invasive species and prevent new invasive species from entering the lakes, reduce nutrients running off from agriculture and stormwater, protect and restore habitats, and to provide education about the Great Lakes ecosystem.  You can read EPA’s news release on the new plan here, and see the actual plan here. We plan to take a closer look at the plan and determine what it means for Ohio agriculture, so watch for future updates!

USDA website revamp helps with H-2A applications and managing loans

Written by Evin Bachelor, Law Fellow, OSU Extension Agricultural & Resource Law Program

The United States Department of Agriculture (USDA) announced last week that farmers.gov will now feature two new tools.  One will help farmers navigate the application process for obtaining temporary agricultural workers under H-2A, and the second will help farmers understand and manage their USDA-backed farm loans.  The press release explained that the USDA values the experience of its customers, and that it developed these tools after hearing feedback on the need for simple, technology based resources to help farmers.  Unveiled in 2018, farmers.gov allows users to apply for USDA programs, process transactions, and manage their accounts.

Customized H-2A checklists based on the needs of an individual farmer

Many farmers need seasonal or temporary workers for planting, cultivating, and harvesting crops.  The seasonal nature of agriculture can make it difficult for farmers to find an adequate supply of domestic labor willing to fill the temporary positions.  To relieve this difficulty, the federal government created the H-2A temporary agricultural worker program to allow these farmers to hire workers from foreign countries to supplement the domestic labor market on a temporary or seasonal basis.  Farmers must demonstrate that there are not enough U.S. workers able, willing, qualified, and available for the temporary work, and that the H-2A workers will not result in reduced wages for other U.S. workers.

Understanding the H-2A process has long been complex and confusing, but a new tool focused on education for smaller producers includes a revamped website and an interactive checklist tool.  The new website explains the basics of the program, includes an interactive checklist tool to create custom checklists, and gives an estimate of the costs of hiring H-2A workers.

The interactive checklist tool is a helpful way for producers to learn about the steps they need to take to obtain the labor that they need.  In the past, websites would rely heavily on producers to sift through information and determine the requirements that they needed to follow.  Now, the interactive tool asks questions one at a time to generate a custom checklist.

When using the tool, producers will first be asked whether this will be their first time hiring workers using the H-2A Visa Program.  If the producer answers yes, they will be asked when they need the labor.  If the producer answers no to the first question, they will be asked whether they are extending the contract of workers that they are currently employing.  Ultimately, the producer will be asked when they need the labor.  At the end of the questions, the tool will provide a checklist that the producer will use to determine what steps he or she needs to take to obtain H-2A labor.  The checklists are designed to be easy to understand and to make the process less confusing.

View information about your USDA-backed farm loan online

The USDA offers farm ownership and operating loans through the Farm Services Agency to family-size farmers and ranchers who cannot obtain commercial credit.  Farmers.gov now allows producers to view information about these USDA-backed farm loans through a secure online account.  Producers can view loan information, history, and payments from a desktop computer, tablet, or smartphone.  Producers will need to sign up for a USDA online account in order to create an account profile with a password.

At this time, the program only allows producers doing business on their own behalf as individuals to view this information through farmers.gov.  Other entities such as LLCs and trusts or producers acting on behalf of another cannot utilize this tool yet, although the USDA indicates that this is planned for in the future.

The USDA’s press release made clear that the addition of these tools represents a step toward providing better customer service and increased transparency.  As only a step, producers can expect more tools and features to be added to farmers.gov in the future.  As this happens, we will be sure to keep you up to date about the website’s new bells and whistles.