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A renewed push to offset the impacts of California’s agricultural overtime law has stalled in its first committee hearing, exposing a widening divide between labor advocates defending overtime protections and farm groups arguing Sacramento subsidizes nearly every major industry except agriculture.
The Senate Labor, Public Employment and Retirement Committee declined to advance legislation by Sen. Shannon Grove, R-Bakersfield, that would create a payroll tax credit tied to overtime wages paid to farmworkers. The proposal, backed by the California Farm Bureau and the California Association of Winegrape Growers, closely mirrors a bill Grove carried last year that also failed in the same committee.
Supporters framed the measure as a way to restore lost farmworker earnings after California’s landmark agricultural overtime law phased in overtime pay after eight hours a day or 40 hours a week. Opponents countered that the bill would effectively force taxpayers to subsidize employers complying with existing labor law.
The debate highlighted a broader shift in agriculture’s political strategy. Rather than seeking to roll back labor mandates outright, farm groups are increasingly pressing lawmakers for tax relief to offset mounting labor, water and regulatory costs they say are squeezing growers and reducing worker hours.
“This is one of the only costs that they can control,” Grove told lawmakers, pointing to rising water prices, fuel costs, Sustainable Groundwater Management Act compliance and other regulatory pressures bearing down on farms.
Sen. Shannon Grove (office photo)Senate Bill 921 would allow agricultural employers covered under Wage Order 14 to claim a payroll tax credit equal to overtime wages paid during a fiscal quarter. The measure would not alter California’s overtime requirements, Grove repeatedly emphasized.
“It does not touch the overtime law,” she said during the hearing. “It simply allows a tax credit and hopefully a funding mechanism to help farmers pay for the overtime work that the employees perform.”
California enacted the overtime law nearly a decade ago through Assembly Bill 1066 by then-Asm. Lorena Gonzalez, D-San Diego. It gradually extended overtime protections to farmworkers that already applied to most other industries. Before the law, agricultural workers generally received overtime after 10 hours a day or 60 hours a week.
Farm groups have spent years warning the policy would reduce worker hours rather than increase pay. Several legislative attempts have followed. In 2024, Asm. James Gallagher, R-Yuba City, unsuccessfully sought to partially roll back the overtime thresholds through AB 3056. Last year, Grove introduced SB 628, another overtime tax credit proposal that also failed in the Senate Labor Committee.
Farmworkers, growers say hours disappeared
This year’s effort leaned heavily on research from University of California, Berkeley, economist Alexandra Hill, which shows farmworkers lost hours and earnings after the overtime changes took effect. According to the study cited by supporters, California farmworkers reported working between 4.2 and 4.7 fewer hours per week in 2022 than in 2012, while annual earnings declined by roughly $2,800.
Farmworker testimony became central to supporters’ arguments.
“When I began to work at Bar 20 Dairy Farms in 2017, I had consistent opportunities to work extended hours and earn additional income over time,” said Emmanuel Torres, a supervisor at the Fresno County operation. “However, overtime opportunities steadily declined and schedules were adjusted to avoid triggering overtime pay requirements.”
Torres said he eventually took a second job to make ends meet and told lawmakers many farmworkers now specifically seek employers willing to offer overtime hours.
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The farm bureau and Grove have compared the proposal to California’s recently expanded film tax credit program, arguing lawmakers had shown a willingness to subsidize Hollywood while rejecting assistance for agriculture.
“Last year, the Legislature decided to help California’s iconic film industry by providing global entertainment companies with substantial tax subsidies,” said Bryan Little, senior director of policy advocacy at the California Farm Bureau. “Agriculture is an iconic California industry too.”
Grove sharpened the contrast in her closing remarks.
“You exempted and voted for a tax credit for the film industry,” she said. “These people produce our food that we eat every single day.”
The hearing drew visible farmworker participation, with several agricultural employees testifying that overtime opportunities had diminished since the law took effect. The farm bureau later highlighted the turnout as evidence the bill had direct worker backing rather than solely grower support.
Still, organized labor remained firmly opposed to reopening the overtime debate.
“This is not a tax credit for farmworkers,” said Sara Flocks, legislative and strategic campaigns director at the California Federation of Labor Unions, which is now under Gonzalez’s leadership. “This is a tax credit paid for by the public — by the taxpayers of California — for the employers.”
Flocks argued farmworkers were excluded from federal overtime protections for decades and said California’s law corrected a historic inequity rooted in discriminatory labor policy.
Committee members appeared sympathetic to both sides but wary of establishing a precedent that reimburses employers for wages already legally required under state law.
Sen. Dave Cortese, D-Silicon Valley, acknowledged commodity pricing pressures unique to agriculture and suggested lawmakers may eventually need broader conversations about how labor standards interact with competitive farm markets. But he cautioned against opening “the flood gates” to similar employer tax credits across industries.
Alexandra Hill (Agri-Pulse/Fred Greaves)Committee Chair Lola Smallwood-Cuevas, D-Los Angeles, similarly praised Grove for raising legitimate concerns about farmworker wages while defending overtime protections as “sacred policy.”
“I just don’t think overtime is where we do it,” said Smallwood-Cuevas. “I don't think we want to in any way infringe on all of the progress that's been made in overtime.”
Governor’s race adds pressure to debate
The issue is also emerging in the 2026 governor’s race, where several candidates have openly questioned whether the overtime law is functioning as intended.
At an agriculture-focused gubernatorial forum in Fresno earlier this month, multiple candidates criticized the state’s broader regulatory environment and pointed specifically to the overtime law as an example of unintended consequences for farmworkers and growers alike.
Former Rep. Katie Porter said the law “has resulted in farmworkers earning less, not more,” citing the UC Berkeley study.
“That [college] is not exactly a bastion of conservative politics,” Porter later told Agri-Pulse. “Those are the hard facts. That law is not working as desired.”
She added that “we are seeing farm activity move to Arizona, move across the border because of the overtime law.” She promised to take “a hard look” at the policy while also reviewing other labor rules affecting agriculture.
Former Los Angeles Mayor Antonio Villaraigosa similarly pointed to studies showing workers lost income after the overtime changes. “It’s about $2,500 that they lose on average,” he said during the debate. Villaraigosa later called for a moratorium on new farming regulations, arguing agriculture, energy and film were all facing existential pressure from Sacramento’s regulatory climate.
For now, lawmakers appear unwilling to reopen the core framework of AB 1066. But the hearing — and the growing attention from gubernatorial candidates — suggest the political fight over its economic consequences is far from over.
