May 13, 2024
Rembolt Ludtke Agriculture and Employment & Labor Law Practice Groups
The general rule under the federal Fair Labor Standards Act of 1938 (“FLSA”) is that an employee is entitled to overtime for all hours worked over 40 in a workweek unless the employer can demonstrate the employee qualifies for an overtime exemption. Recently, a federal district court was tasked with deciding whether a “manure handler” qualified for the agriculture overtime exemption.
In Porter v. T.J. Crowder & Sons, LLC, 2024 WL2111571 (D. Colo. May 10, 2024), employer T.J. Crowder and Sons, LLC, doing business as Humalfa (“Humalfa”), is a composting company that converts raw cattle manure into fertilizer. Humalfa operated at a cattle feedlot owned by a third-party/customer. Feedlot employees were responsible for cleaning the cattle pens and piling the manure in the pens. Humalfa employees would then load the manure piles onto a dump truck and haul the manure to the compost yards where it would be unloaded. Once the manure was unloaded, a machine would turn and compost the manure for about eight weeks after which the compost was spread out on pastures and elsewhere as fertilizer.
Plaintiff Christopher Porter was employed by Humalfa as a “manure handler.” His duties included loading the piles of manure from the pens, hauling manure from the cattle pens to the compost yard, and dumping the manure in windrows for turning.
Although Porter worked up to 70 hours per week, Humalfa paid him just straight time for all hours worked and did not pay time and one-half for overtime wages, claiming the FLSA’s agricultural exemption applied. As Humalfa’s owner testified at trial, “You don’t get more ag than dealing with cattle manure; that’s about as ag as it gets.”
Unfortunately, it’s not that simple.
The court began its analysis by noting that under the FLSA, “any employee employed in agriculture” is exempt from the overtime pay requirement. 29 U.S.C. § 213(b)(12). The FLSA defines “agriculture” as including:
farming in all its branches and among other things includes the cultivation and tillage of the soil, dairying, the production, cultivation, growing, and harvesting of any agricultural or horticultural commodities..., the raising of livestock, bees, fur-bearing animals, or poultry, and any practices (including any forestry or lumbering operations) performed by a farmer or on a farm as an incident to or in conjunction with such farming operations, including preparation for market, delivery to storage or to market or to carriers for transportation to market.
29 U.S.C. § 203(f).
Courts have interpreted the definition of agriculture in the FLSA to include “farming in both a primary and a secondary sense.” Here, the employer argued that Humalfa’s activity falls within the definition of secondary agriculture. To fall within the secondary sense of agriculture, Humalfa was required to prove that Porters’ work was: “(1) performed by a farmer or on a farm, and (2) incident to or in conjunction with such farming operations.”
It was undisputed that Porter’s work took place “on a farm.” Thus, the dispute centered on whether Humalfa’s work in composting was “incident to or in conjunction with farming operations.” Here, the court looked to federal regulations for guidance as to when work is incident to or in conjunction with farming operations:
Generally, a practice performed in connection with farming operations is within the statutory language only if it constitutes an established part of agriculture, is subordinate to the farming operations involved, and does not amount to an independent business. Industrial operations and processes that are more akin to manufacturing than to agriculture are not included. This is also true when on-the-farm practices are performed for a farmer.
29 C.F.R. § 780.144. Quoting from the United States Supreme Court’s 1949 decision in Farmers Reservoir & Irrigation Co. v. McComb, the trial court noted that “[w]hether a particular type of activity is agricultural depends, in large measure, upon the way in which that activity is organized.” For example, “[t]he fashioning of tools, the provision of fertilizer, the processing of the product, to mention only a few examples, are functions which [may be] performed on the farm by farmers as part of their normal agricultural routine,” but maybe completed through industrial processes under other systems. To illustrate this divide, the McComb Court contrasted “the compost heap” with "factory produced fertilizer,” and power “derived from electricity and gasoline” with power “supplied by the farmer’s mules.” As one final illustrative comparison, the McComb Court concluded that “[t]he farmhand who cares for the farmer’s mules or prepares his fertilizer is engaged in agriculture,” while “the maintenance man in a power plant and the packer in a fertilizer factory are not.”
Here, the trial court found that the FLSA’s agriculture exemption applied and that Porter was not entitled to overtime. As the trial court noted, Porter was engaged in manually loading manure directly from livestock pens on a farm and transporting it to a “compost heap” located in a pasture on the same farm. Once there, the manure was simply turned in the field for eight weeks, with no additives or further industrial processing. Moreover, Humalfa’s services were provided in conjunction with the primary cattle feeding operation. As one witness described it, the feedlot needed "the manure out and they like to have the fertilizer on the pastures.”
Takeaways:
As noted at the outset, the FLSA requires every employee to be paid time and a-half for all hours worked over 40 in a workweek unless the employer can demonstrate the employee qualifies for an overtime exemption. The burden is on the employer to establish that a particular overtime exemption exists, making it especially important for employers to analyze each and every position in their organization to determine whether it is “exempt” or “non-exempt” from overtime.
This is especially true now with respect to what are called the white-collar overtime exemptions. On April 29, 2024, the U.S. Department of Labor released a final rule that substantially increases the minimum salary requirements for the executive, administrative, and professional employee overtime exemptions. Effective July 1st, the rule will raise the salary requirement to $844 per week, which is equivalent to a $43,888 annual salary. Beginning January 1, 2025, the threshold jumps to $1,128 per week, or $58,656 per year. These new thresholds are significant increases over the current salary thresholds of $684 per week, or $35,568 per year. Employers failing to correctly categorize employees as “exempt” or “non-exempt” risk significant backpay, liquidated damage and attorney’s fee liability.
Rembolt Ludtke is available to assist employers in all industries, including agriculture, with questions regarding the FLSA’s requirements and other legal and workplace issues.
This article is provided for general information purposes only and should not be construed as legal advice. Those requiring legal advice are encouraged to consult with their attorney.
