In a word, yes, it’s okay to pay wages in the form of food and lodging. The good news is that if minimum wage is not owed at all—either at the state or federal level—in-kind wages can be offered without having to jump through any hoops. In this case, farmers need to at least be sure to keep records proving that they are exempt from the minimum wage requirements.

In addition, if in-kind compensation is provided on top of a cash payment of at least the minimum wage, there are no legal restrictions on how in-kind payments must be made. For example, let’s say that farmer Amanda must pay her workers at least the federal minimum wage of $7.25 per hour. If she pays them $7.25 per hour in cash and on top of that provides lunchtime meals as a bonus, Amanda doesn’t have to comply with the legal requirements for valuing and recording the costs of the lunches provided (discussed below). With that said, farmers must always be sure to abide by any promises or agreements they enter into with the employee when paying in-kind.