Or. Admin. Code § 150-315-0072

Current through Register Vol. 63, No. 10, October 1, 2024

Section 150-315-0072 - Agricultural Employer Overtime Tax Credit Full-Time Equivalency (FTE) Calculation

(1) Definitions. For purposes of this rule:

(a) Eligible employer. A producer of crops, animals, or aquaculture that employs agricultural workers directly, or indirectly through contract with a labor contractor.

(b) Employee. A person employed for wages or salary.

(c) Farm labor contractor has the same meaning as OAR 839-015-0004.

(2) For purposes of determining the applicable percentage of the credit allowed under Oregon Laws 2022, chapter 115, section 9, an eligible employer's number of full-time equivalent (FTE) employees is equal to the total hours worked by all employees of the eligible employer during the calendar year divided by 2,080. The total hours include all hours worked by agricultural employees subject to overtime compensation requirements, and:

(a) Agricultural employees exempt from overtime compensation requirements under Oregon Laws 2022, chapter 115, section 4a, such as managerial employees and immediate family members of the eligible employer;

(b) Employees that do not perform services in agriculture; and

(c) Employees that perform work partially or entirely outside of Oregon.

(3) For purposes of this rule, hours worked by agricultural workers employed by a farm labor contractor on behalf of an eligible employer are considered hours worked by an employee of the eligible employer.

Example 1: Alpha Corp, Inc. employs 50 agricultural employees on Oregon farms. Five of those employees perform managerial work and are paid on a salary basis. The 45 agricultural employees subject to overtime compensation requirements worked a combined 70,000 hours during the calendar year, while the managerial employees worked a combined 12,000 hours. Because the hours of all employees are used to determine the number of FTE employees, Alpha Corp, Inc. has 39.42 (82,000 divided by 2,080) FTE employees for purposes of determining the applicable percentage of the credit.

Example 2: Same facts as Example 1, but Alpha Corp, Inc. also operates a farm in California. The farm in California uses permanent employees as well as agricultural workers contracted through a labor contractor. The employees and labor contractor agricultural workers in California work a combined total of 40,000 hours. Because the hours worked by out-of-state employees and the hours worked by agricultural workers contracted through a labor contractor are included in total hours used to determine the number of FTE employees, Alpha Corp, Inc. employees have a combined total of 122,000 hours worked and a total of 58.65 (122,000 divided by 2,080) FTE employees.

Example 3: Robin operates a hazelnut orchard in Oregon as a single-member LLC. He employs 25 unrelated employees throughout the year, but also employs his sister and his son. Recently, Robin has been branching out to offer junk removal services during slow periods of the year. His 25 unrelated agricultural workers work a combined total of 50,000 hours during the calendar year, with 10,000 of those hours spent working on the junk removal services. His sister and son work a combined total of 5,000 hours. Because employee hours worked in nonagricultural work and hours worked by overtime-exempt employees are both included in the total hours worked by employees, Robin has 26.44 (55,000 divided by 2,080) FTE employees for purposes of determining the applicable percentage of the credit.

Or. Admin. Code § 150-315-0072

REV 26-2023, adopt filed 12/26/2023, effective 1/1/2024

Statutory/Other Authority: ORS 305.100 & 2022 Oregon Laws Chapter 115, Section 9

Statutes/Other Implemented: 2022 Oregon Laws Chapter 115, Section 9