Average Employment The proposal would extend coverage to relatively fow farms, about 5%, but about 30% of all farm employment. Effect of Proposed Ul Coverage of Agricultural Wage and Salary Employment. Benefit Cost Rates and Average Tax Rates for Selected Industries by State (selected years) 1/ Benefits paid as a percent of taxable wages. For Arizona, Connecticut, Nebraska, and 2/ Benefit cost rates not available for these industries. Average tax rates are only Effect of the Proposed Change in Definition of Agricultural Labor The language used in H.R. 12625 to redefine agricultural labor affecting coverage of employment in the processing of agricultural products and certain other types of employment is identical to the language found in E.R. 15119 which was passed by both Houses of Congress in 1966. The present definition of agricultural labor found in Section 3306(k) of the Internal Revenue Code of 1954, excludes from unemployment insurance protection workers performing services in the processing of agricultural products, such as handling, drying, grading and packing of such products, if these services are incidental to ordinary farming operations. Under the definition, employers hiring workers for the performance of these processing services, produce a portion of the crop on which such processing is performed and also render processing services to other farm operators. One major effect of the proposed definition is to apply a specific test (see following example) to employers of such labor to determine whether they are employers of agricultural or non-agricultural labor. If, for example, a farm operator raises and harvests tomatoes and also sorts and grades his own tomatoes and provides such sorting and grading of tomatoes for other farm operators the proposed 50-percent criterion would be applied, [see H.R. 12625, Sec. 103(k) and FICA, Sec. 3121(g)(4)(A) and (4)(B). If such a farm operator produced 50 percent or less of the tomatoes upon which the processing services (sorting, grading, etc.) were performed, the labor used in this processing would not meet the proposed test of agricultural labor, as defined, and therefore, the employer would then be subject to the same provisions of the Federal Unemployment Tax Act (FUTA) and the State unemployment insurance law as vould any other non-agricultural employer. If, however, the farm operator produced more than 50 percent of the tomatoes upon which the processing services vere performed he would be deemed an employer of agricultural labor and be subject to the Federal and State provisions of the unemployment insurance laws applicable to employers of agricultural labor. The second major effect of the proposed definition is to remove from the definition of agricultural labor, services performed in connection with the production or harvesting of maple syrup or maple sugar, or in connection with the hatching of poultry. Employers engaged in these activities would be treated the same as any other non-agricultural employer subject to the provisions of the FUTA. The proposed change in definition of agricultural labor would extend unemployment insurance coverage to about 200,000 jobs. Comparison of Definitions of "Agricultural Labor", FICA and FUTA 3121 FICA 3306 FUTA (8) AGRICULTURAL LABOR--For purposes of this chapter, (1) on a farm, in the employ of any person, in connection with cultivating the soil, or in connection with raising or harvesting any agricultural or horticultural commodity, including the raising, shearing, feeding, caring for, training, and management of livestock, bees, poultry, and fur-bearing animals and wildlife; (2) in the employ of the owner or tenant or other operator of a farm, in connection with the operation, management, conservation, improvement, or maintenance of such farm and its tools and equipment, or in salvaging timber or clearing land of brush and other debris left by a hurricane, if the major part of such service is performed on a farm; (3) in connection with the production or harvesting of any commodity defined as an agricultural commodity in section 15(g) of Agricultural Marketing Act, as amended (K) AGRICULTURAL LABOR--For purposes of this chap- (1) on a farm, in the employ of any person, in connection with cultivating the soil, or in connection with raising or harvesting any agricultural or horticultural commodity, including the raising, shearing, feeding, caring for, training, and management of livestock, bees, poultry, and fur-bearing animals and wildlife; (2) in the employ of the owner or tenant or other operator of a farm, in connection with the operation, management, conservation, improvement, or maintenance of such farm and its tools and equipment, or in salvaging timber or clearing land of brush and other debris left by a hurricane, if the major part of such service is performed on a farm; (3) in connection with the production or harvesting of maple syrup or maple sugar or any commodity defined as an agricultural commodity in section 15(g) of the Agricultural Marketing Act, June 25, 1969 Comparison of Definitions of "Agricultural Labor", FICA and FUTA (con't) p. 2 FICA (46 Stat. 1550 § 3; 12 U.S.C. 1141j), or (4)(A) in the employ of the operator of a farm in handling, planting, drying, (B) in the employ of a group of operators rooms FUTA as amended (46 Stat. 1550 3; 12 U.S.c. 1141j), or (4) in handling, planting, drying, packing, packaging, |