will not create a substantial probability of reducing the full-time employment opportunities of persons other than those employed under the certificate. Existing law (section 14(c)) also permits the employment of full-time students in agriculture at wage rates below the applicable minimum wage. Such employment is subject to the conditions described in clauses (1), (2), (3), and (5) of the preceding

sentence.

This section's amendment to section 14 combines the current student exemptions for employment in retail-service establishments and in agriculture into an exemption for employment of students in any occupation other than one of the hazardous ones listed in section 14 (b) (1) or any other one designated by the Secretary.

Students may be employed at a wage rate of not less than 85 per centum of the applicable minimum wage rate or $1.60 an hour ($1.30 an hour in the case of employment in agriculture), whichever is the higher. As in existing law, the employment is to be under special certificates issued by the Secretary. Such special certificates shall provide (as in existing law) that such students shall, except during vacation periods, be employed on a part-time basis (not to exceed 20 hours in any workweek). In the case of an employer who employs five or more students under special certificates, the Secretary may not issue a special certificate for the employment of a number of students which will cause the total employed under certificates to exceed five unless he finds the employment of the student "will not create a substantial probability of reducing the full-time employment opportunities" of other workers. In the case of an employer who employs less than five students under special certificates, the Secretary may issue a special certificate if the employer certifies to the Secretary that he is not thereby reducing the full-time employment opportunities for other workers. Sections 15 (Prohibited Acts) and 16 (Penalties) of the Act would be applicable to an employer who violated the requirements of the new section 14(b). A summary of the special certificates issued under this provision is required to be included in the Secretary's annual report on the Act.

This section also provides that the Secretary may waive the minimum wage and overtime provisions of the Act with respect to a stu̟dent employed by his elementary or secondary school, where such employment constitutes an integral part of the regular education program provided by the school.

Section 207. Laundry and Cleaning Establishments to be Considered Service Establishments for Certain Purposes.-This section requires the consideration of laundries and dry cleaning establishments as service establishments in the administration of sections 7 (i) (relating to commission employees) and 13(a)(1) (relating to executive and administrative personnel and outside salesmen) of the Act.

Section 208. Maids and Custodial Employees of Hotels and Motels.This section amends section 13(b) (8) to repeal the overtime exemption for maids and custodial employees of hotels and motels.

Section 209. Employees of Conglomerates.-This section amends section 13 to preclude the applicability of the minimum wage and overtime exemptions of subsection (a) and (b) of that section (except those relating to employees in executive, administrative, or professional capacities, or in the capacity of outside salesmen, and the overtime exemptions relating to employees whose hours of service are

subject to the provisions of the Motor Carrier Act, Interstate Commerce Act, or Railway Labor Act) to conglomerates with an annual gross volume of sales made or business done in excess of $10 million. A conglomerate is "an establishment (1) which controls, is controlled by, or is under common control with, another establishment the activities of which are not related for a common business purpose to the activities of the establishment employing such employee; and (2) whose annual gross volume of sales made or business done, when combined with the annual gross volume of sales made or business done by each establishment which controls, is controlled by, or is under common control with, the establishment employing such employee, exceeds $10 million (exclusive of excise taxes at the retail level which are separately stated)."

Section 210. Employees of Boat Dealers.-This section amends section 13 (b) (10) to provide an overtime exemption for any salesman, partsman, or mechanic primarily engaged in selling or servicing boats if employed by a nonmanufacturing establishment primarily engaged in the business of selling boats to ultimate purchasers. Existing law provides an overtime exemption for employees engaged in related activities and employed by automobile, trailer, truck, farm implement, or aircraft dealerships.

Section 211. Tobacco Employees. This section amends section 7 to retain the existing overtime exemption applicable to certain employees engaged in activities related to the sale of tobacco. The exemption would otherwise be reduced and ultimately repealed by amendment made by section 204 to section 7(c) of the Act (relating to seasonal industry employees).

Section 212. Substitute Parents for Institutionalized Children.This section amends section 13 (a) to establish an exemption from the minimum wage and overtime compensation provisions of the Act for an employee who is employed with his spouse by a nonprofit educational institution to serve as parents to children who have been placed in such institution by or through a public agency or by parents or guardians who are financially unable to care for and educate their children or children under their guardianship. The substitute parents must also reside in the facilities of the institution, receive room and board without cost, and jointly receive cash compensation at an annual rate of not less than $10,000.

Title III-Conforming Amendments: Effective Date and

Regulations

Section 301. Conforming Amendments. This section amends section 6(e) of the Act to eliminate the minimum wage differential for employees employed under a service contract with the United States. Currently, certain linen service employees must receive not less than the section 6(a) (1) rate and the remainder are to receive the section 6(b) rate. Under the amendment, all would be required to be paid. not less than the section 6(a) (1) rate. Additionally, technical amendments are made to section 8.

Section 302. Effective Date and Regulations.-This section provides that unless otherwise indicated, the effective date of the 1973 Amendments shall be the first day of the second full month which begins after the date of enactment, or August 1, 1973, whichever occurs first.

CHANGES IN EXISTING LAW MADE BY H.R. 7935,
AS REPORTED

In compliance with clause 3 of Rule XIII of the Rules of the House of Representatives, changes in existing law made by the bill, H.R. 7935, as reported, are shown as follows (existing law proposed to be omitted is enclosed in black brackets, new matter is printed in italics, existing law in which no change is proposed is shown in roman):

FAIR LABOR STANDARDS ACT OF 1938

AN ACT To provide for the establishment of fair labor standards in employments in and affecting interstate commerce, and for other purposes

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That this Act may be cited as the "Fair Labor Standards Act of 1938."

FINDING AND DECLARATION OF POLICY

SEC. 2. (a) The Congress hereby finds that the existence, in industries engaged in commerce or in the production of goods for commerce, of labor conditions detrimental to the maintenance of the minimum standard of living necessary for health, efficiency, and general well-being of workers (1) causes commerce and the channels and instrumentalities of commerce to be used to spread and perpetuate such labor conditions among the workers of the several States; (2) burdens commerce and the free flow of goods in commerce; (3) constitutes an unfair method of competition in commerce; (4) leads to labor disputes burdening and obstructing commerce and the free flow of goods in commerce; and (5) interferes with the orderly and fair marketing of goods in commerce.

(b) It is hereby declared to be the policy of this Act, through the exercise by Congress of its power to regulate commerce among the several States and with foreign nations, to correct and as rapidly as practicable to eliminate the conditions above referred to in such industries without substantially curtailing employment or earning

power.

DEFINITIONS

SEC. 3. As used in this Act—

(a) "Person" means an individual, partnership, association, corporation, business trust, legal representative, or any organized group of persons.

(b) "Commerce" means trade, commerce, transportation, transmission, or communication among the several States or between any State and any place outside thereof.

(c) "State" means any State of the United States or the District of Columbia or any Territory or possession of the United States.

(51)

(d) "Employer" includes any person acting directly or indirectly in the interest of an employer in relation to an employee [but shall not include the United States or any State or political subdivision of a State (except with respect to employees of a State, or a political subdivision thereof, employed (1) in a hospital, institution, or school referred to in the last sentence of subsection (r) of this section, or (2) in the operation of a railway or carrier referred to in such sentence), or any labor organization (other than when acting as an employer), of anyone acting in the capacity of officer or agent of such labor organization.] and includes the United States or any State or political subdivision of a State, but does not include any labor organization (other than when acting as an employer) or anyone acting in the capacity of officer or agent of such labor organization.

(e) "Employee" includes any individual employed by an employer, except that such term shall not, for the purposes of section 3 (u), include

(1) any individual employed by an employer engaged in agriculture if such individual is the parent, spouse, child, or other member of the employer's immediate family, or

(2) any individual who is employed by an employer engaged in agriculture if such individual (A) is employed as a hand harvest laborer and is paid on a piece rate basis in an operation which has been, and is customarily and generally recognized as having been, paid on a piece rate basis in the region of employment, (B) commutes daily from his permanent residence to the farm on which he is so employed, and (C) has been employed in agriculture less than thirteen weeks during the preceding calendar year.

(f) "Agriculture" includes 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 (including commodities defined as agricultural commodities in section 15(g) of the Agricultural Marketing Act, as amended), the raising of livestock, bees, furbearing 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.

(g) "Employ" includes to suffer or permit to work.

"Industry" means a trade, business, industry, or branch thereof, or group of industries, in which individuals are gainfully employed. (i) "Goods" means goods (including ships and marine equipment), wares, products, commodities, merchandise, or articles or subjects of commerce of any character, or any part or ingredient thereof, but does not include goods after their delivery into the actual physical possession of the ultimate consumer thereof other than a producer, manufacturer, or processor thereof.

(j) "Produced" means produced, manufactured, mined, handled, or in any other manner worked on in any State; and for the purposes of this Act an employee shall be deemed to have been engaged in the production of goods if such employee was employed in producing, manufacturing, mining, handling, transporting, or in any other man

ner working on such goods, or in any closely related process or occupation directly essential to the production thereof, in any State.

(k) "Sale" or "sell" includes any sale, exchange, contract to sell, consignment for sale, shipment for sale, or other disposition.

(1) "Oppressive child labor" means a condition of employment under which (1) any employee under the age of sixteen years is employed by an employer (other than a parent or a person standing in place of a parent employing his own child or a child in his custody under the age of sixteen years in an occupation other than manufacturing or mining or an occupation found by the Secretary of Labor to be particularly hazardous for the employment of children between the ages of sixteen and eighteen years or detrimental to their health or well-being) in any occupation, or (2) any employee between the ages of sixteen and eighteen years is employed by an employer in any occupation which the Secretary of Labor shall find and by order declare to be particularly hazardous for the employment of children between such ages or detrimental to their health or well-being; but oppressive child labor shall not be deemed to exist by virtue of the employment in any occupation of any person with respect to whom the employer shall have on file an unexpired certificate issued and held pursuant to regulations of the Secretary of Labor certifying that such person is above the oppressive child labor age. The Secretary of Labor shall provide by regulation or by order that the employment of employees between the ages of fourteen and sixteen years in occupations other than manufacturing and mining shall not be deemed to constitute oppressive child labor if and to the extent that the Secretary of Labor determines that such employment is confined to periods which will not interfere with their schooling and to conditions which will not interfere with their health and well-being.

(m) "Wage" paid to any employee includes the reasonable cost, as determined by the Secretary of Labor, to the employer of furnishing such employee with board, lodging, or other facilities, if such board, lodging, or other facilities are customarily furnished by such employer to his employees: Provided, That the cost of board, lodging, or other facilities shall not be included as a part of the wage paid to any employee to the extent it is excluded therefrom under the terms of a bona fide collective-bargaining agreement applicable to the particular employee: Provided further, That the Secretary is authorized to determine the fair value of such board, lodging, or other facilities for defined classes of employees and in defined areas, based on average cost to the employer or to groups of employers similarly situated, or average value to groups of employees, or other appropriate measures of fair value. Such evaluations, where applicable and pertinent, shall be used in lieu of actual measure of cost in determining the wage paid to any employee. In determining the wage of a tipped employee, the amount paid such employee by his employer shall be deemed to be increased on account of tips by an amount determined by the employer, but not by an amount in excess of 50 per centum of the applicable minimum wage rate, except that in the case of an employee who (either himself or acting through his representative) shows to the satisfaction of the Secretary that the actual amount of tips received by him was less than the amount determined by the employer as the amount by which the wage paid him was deemed to be increased under