29 C.F.R. Subpart I—Employment in Ginning of Cotton and Processing of Sugar Beets, Sugar-Beet Molasses, Sugarcane, or Maple Sap into Sugar or Syrup; Exemption From Overtime Pay Requirements Under Section 13(b)(15)
Title 29 - Labor
Subpart A of this part 780 and this subpart I constitute the official interpretative bulletin of the Department of Labor with respect to the meaning and application of section 13(b)(15) of the Fair Labor Standards Act of 1938, as amended. This section provides an exemption from the overtime pay provisions of the Act for two industries (a) for employees engaged in ginning of cotton for market in any place of employment located in a county where cotton is grown in commercial quantities and (b) for employees engaged in the processing of sugar beets, sugar-beet molasses, sugarcane or maple sap, into sugar (other than refined sugar) or syrup. The limited overtime exemptions provided for cotton ginning and for sugar processing under sections 7(c) and 7(d) (see part 526 of this chapter) are not discussed in this subpart. Section 13(b)(15) of the Fair Labor Standards Act exempts from the overtime requirements of section 7:
Any employee engaged in ginning of cotton for market, in any place of employment located in a county where cotton is grown in commercial quantities, or in the processing of sugar beets, sugar-beet molasses, sugarcane, or maple sap, into sugar (other than refined sugar) or syrup. Section 13(b)(15) supplants two exemptions that were contained in the Act prior to the Fair Labor Standards Amendments of 1966. The first is former section 13(a)(18), having identical language, which provided a complete exemption for those employed in the ginning of cotton. The second is the former section 7(c) which provided an overtime exemption for the employees of an employer engaged in sugar processing operations resulting in unrefined sugar or syrup. It is apparent from the language of section 13(b)(15) that the application of this exemption depends upon the nature and purpose of the work performed by the individual employee for whom exemption is sought, and in the case of ginning of cotton on the location of the place of employment where the work is done and other factors as well. It does not depend upon the character of the business of the employer. A determination of whether an employee is exempt therefore requires an examination of that employee's duties. Some employees of the employer may be exempt while others may not. Under the first part of section 13(b)(15) of the Act, the ginning of cotton, all the following conditions must be met in order for the exemption to apply to an employee: (a) He must be “engaged in ginning.” (b) The commodity ginned must be cotton. (c) The ginning of the cotton must be “for market.” (d) The place of employment in which this work is done must be “located in a county where cotton is grown in commercial quantities.” The following sections discuss the meaning and application of these requirements.
Title 29: Labor
PART 780—EXEMPTIONS APPLICABLE TO AGRICULTURE, PROCESSING OF AGRICULTURAL COMMODITIES, AND RELATED SUBJECTS UNDER THE FAIR LABOR STANDARDS ACT
Subpart I—Employment in Ginning of Cotton and Processing of Sugar Beets, Sugar-Beet Molasses, Sugarcane, or Maple Sap into Sugar or Syrup; Exemption From Overtime Pay Requirements Under Section 13(b)(15)
Introductory
§ 780.800 Scope and significance of interpretative bulletin.
§ 780.801 Statutory provisions.
§ 780.802 What determines application of the exemption.
§ 780.803 Basic conditions of exemption; first part, ginning of cotton.
Ginning of Cotton for Market
§ 780.804 “Ginning” of cotton.
The term “ginning” refers to operations performed on “seed cotton” to separate the seeds from the spinnable fibers. (Moore v. Farmer's Manufacturing and Ginning Co., 51 Ariz., 378, 77 F. 2d 209; Frazier v. Stone, 171 Miss. 56, 156 So. 596). “Seed cotton” is cotton in its natural state (Burchfield v. Tanner, 142 Tex. 404, 178 S.W. 2d 681, 683) and the ginning to which section 13(b)(15) refers is the “first processing” of this agricultural commodity (107 Cong. Rec. (daily ed.) p. 5887), which converts it into the marketable product commonly known as “lint cotton” (Wirtz v. Southern Pickery Inc. (W.D. Tenn.) 278 F. Supp. 729; Mangan v. State, 76 Ala. 60, 66) by removing the seed from the lint and then pressing and wrapping the lint into bales.
§ 780.805 Ginning of “cotton.”
Only the ginning of “cotton” is within the first part of the exemption. An employee engaged in ginning of moss, for example, would not be exempt. The reconditioning of cotton waste resulting from spinning or oil mill operations is not included, since such waste is not the agricultural commodity in its natural state for whose first processing the exemption was provided. (See 107 Cong. Rec. (daily ed.) p. 5887.) The “cotton,” “seed cotton,” and “lint cotton” ginned by ordinary gins do not include “linter” or “Grabbot” cotton, obtained by reginning cotton seed and hard locks of cotton mixed with hulls, bolls, and other substances which could not be removed by ordinary ginning (Mississippi Levee Com'rs v. Refuge Cotton Oil Co., 91 Miss. 480, 44 So. 828, 829). Mote ginning, the process whereby raw motes (leaves, trash, sticks, dirt, and immature cotton with some cottonseed) are run through a ginning process to extract the short-fiber cotton, is not included in the ginning of cotton unless it is done as a part of the whole ginning process in one gin establishment as a continuous and uninterrupted series of operations resulting in useful cotton products including the regular “gin” bales, the “mote” bales (short-fiber cotton), and the cottonseed.
§ 780.806 Exempt ginning limited to first processing.
As indicated in §780.804, the ginning for which the exemption is intended is the first processing of the agricultural commodity, cotton, in its natural form, into lint cotton for market. It does not include further operations which may be performed on the cottonseed or the cotton lint, even though such operations are performed in the same establishment where the ginning is done. Delinting, which is the removal of short fibers and fuzz from cottonseed, is not exempt under section 13(b)(15). It is not first processing of the seed cotton; rather, it is performed on cottonseed, usually in cottonseed processing establishments, and even if regarded as ginning (Mitchell v. Burgess, 239 F. 2d 484) it is not the ginning of cotton for market contemplated by section 13(b)(15). It may come within the overtime exemption provided in section 7(d) of the Act for certain seasonal industries. (See §526.11(b)(1) of part 526 of this chapter.) Compressing of cotton, which is the pressing of bales into higher density bales than those which come from the gin, is a further processing of the cotton entirely removed from ginning (Peacock v. Lubbock Compress Co., 252 F. 2d 892). Employees engaged in compressing may, however, be subject to exemption from overtime pay under section 7(c). (See §526.10(b)(8) of this chapter.)
§ 780.807 Cotton must be ginned “for market.”
As noted in §780.804, it is ginning of seed cotton which converts the cotton to marketable form. Section 13(b)(15), however, provides an exemption only where the cotton is actually ginned “for market.” (Wirtz v. Southern Pickery, Inc. (W.D. Tenn.) 278 F. Supp. 729.) The ginning of cotton for some other purpose is not exempt work. Cotton is not ginned “for market” if it is not to be marketed in the form in which the ginning operation leaves it. Cotton is not ginned “for market” if it is being ginned preliminary to further processing operations to be performed on the cotton by the same employer before marketing the commodity in an altered form. (Compare Mitchell v. Park (D. Minn.), 14 WH Cases 43, 36 Labor Cases 65, 191; Bush v. Wilson & Co., 157 Kans. 82, 138 P. 2d 457; Gaskin v. Clell Coleman & Sons, 2 WH Cases 977.)
Employees “Engaged in” Ginning
§ 780.808 Who may qualify for the exemption generally.
The exemption applies to “any employee engaged in” ginning of cotton. This means that the exemption may apply to an employee so engaged, no matter by whom he is employed. Employees of the gin operator, of an independent contractor, or of a farmer may come within the exemption in any workweek when all other conditions of the exemption are met. To come within the exemption, however, an employee's work must be an integral part of ginning of cotton, as previously described. The courts have uniformly held that exemptions in the Act must be construed strictly to carry out the purpose of the Act. (See §780.2, in subpart A of this part.) No operation in which an employee engages in a place of employment where cotton is ginned is exempt unless it comes within the meaning of the term “ginning.”
§ 780.809 Employees engaged in exempt operations.
Employees engaged in actual ginning operations, as described in §780.804 will come within the exemption if all other conditions of section 13(b)(15) are met. The following activities are among those within the meaning of the term “engaged in ginning of cotton”:
(a) “Spotting” vehicles in the gin yard or in nearby areas before or after being weighed.
(b) Moving vehicles in the gin yard or from nearby areas to the “Suction” and reparking them subsequently.
(c) Weighing the seed cotton prior to ginning, weighing lint cotton and seed subsequent to ginning (including preparation of weight records and tickets in connection with weighing operations).
(d) Placing seed cotton in temporary storage at the gin and removing the cotton from such storage to be ginned.
(e) Operating the suction feed.
(f) Operating the gin stands and power equipment.
(g) Making gin repairs during the ginning season.
(h) Operating the press, including the handling of bagging and ties in connection with the ginning operations of that gin.
(i) Removing bales from the press to holding areas on or near the gin premises.
(j) Others whose work is so directly and physically connected with the ginning process itself that it constitutes an integral part of its actual performance.
§ 780.810 Employees not “engaged in” ginning.
Since an employee must actually be “engaged in” ginning of cotton to come within the exemption, an employee engaged in other tasks, not an integral part of “ginning” operations, will not be exempt. (See, for rule that only the employees performing the work described in the exemption are exempt, Wirtz v. Burton Mercantile and Gin Co., Inc., 234 F. Supp. 825, aff'd per curiam 338 F. 2d 414, cert. denied 380 U.S. 965; Wirtz v. Kelso Gin Co., Inc. (E.D. Ark.) 50 Labor Cases 31, 631, 16 WH Cases 663; Mitchell v. Stinson, 217 F. 2d 210; Phillips v. Meeker Cooperative Light and Power Ass'n 63 F. Supp. 743, affirmed 158 F. 2d 698; Jenkins v. Durkin, 208 F. 2d 941; Heaburg v. Independent Oil Mill, Inc., 46 F. Supp. 751; Abram v. San Joaquin Cotton Oil Co., 46 F. Supp. 969.) The following activities are among those not within the meaning of the term “engaged in ginning of cotton”:
(a) Transporting seed cotton from farms or other points to the gin.
(b) General maintenance work (as opposed to operating repairs).
(c) General office and custodial duties.
(d) “Watching” duties.
(e) Working in the seed house.
(f) Transporting seed, hulls, and ginned bales away from the gin.
(g) Any activity performed during the “off-season.”
County Where Cotton Is Grown in Commercial Quantities
§ 780.811 Exemption dependent upon place of employment generally.
Under the first part of section 13(b)(15), if the employee's work meets the requirements for exemption, the location of the place of employment where he performs it will determine whether the exemption is applicable. This location is required to be in a county where cotton is grown in commercial quantities. The exemption will apply, however, to an employee who performs such work in “any” place of employment in such a county. The place of employment in which he engages in ginning need not be an establishment exclusively or even principally devoted to such operations; nor is it important whether the place of employment is on a farm or in a town or city in such a county, or whether or to what extent the cotton ginned there comes from the county in which the ginning is done or from nearby or distant sources. It is enough if the place of employment where the employee is engaged in ginning cotton for market is “located” in such a county.
§ 780.812 “County.”
As used in the section 13(b)(15) exemption, the term “county” refers to the political subdivision of a State commonly known as such, whether or not such a unit bears that name in a particular State. It would, for example, refer to the political subdivision known as a “parish” in the State of Louisiana. A place of employment would not be located in a county, within the meaning of the exemption, if it were located in a city which, in the particular State, was not a part of any county.
§ 780.813 “County where cotton is grown.”
For the exemption to apply, the employee must be ginning cotton in a place of employment in a county where cotton “is grown” in the described quantities. It is the cotton grown, not the cotton ginned in the place of employment, to which the quantity test is applicable. The quantities of cotton ginned in the county do not matter, so long as the requisite quantities are grown there.
§ 780.814 “Grown in commercial quantities.”
Cotton must be “grown in commercial quantities” in the county where the place of employment is located if an employee ginning cotton in such place is to be exempt under section 13(b)(15). The term “commercial quantities” is not defined in the statute, but in the cotton-growing areas of the country there should be little question in most instances as to whether commercial quantities of cotton are grown in the county where the ginning is done. If it should become necessary to determine whether commercial quantities are grown in a particular county, it would appear appropriate in view of crop-year variations to consider average quantities produced over a representative period such as 5 years. On the question of whether the quantities grown are “commercial” quantities, the trade understanding of what are “commercial” quantities of cotton would be important. It would appear appropriate also to measure “commercial” quantities in terms of marketable lint cotton in bales rather than by acreage or amounts of seed cotton grown, since seed cotton is not a commercially marketable product (Mangan v. State, 76 Ala. 60). Also, production of a commodity in “commercial” quantities generally involves quantities sufficient for sale with a reasonable expectation of some return to the producers in excess of costs (Bianco v. Hess (Ariz.), 339 P. 2d 1038; Nystel v. Thomas (Tex. Civ. App.) 42 S.W. 2d 168).
§ 780.815 Basic conditions of exemption; second part, processing of sugar beets, sugar-beet molasses, sugarcane, or maple sap.
Under the second part of section 13(b)(15) of the Act, the following conditions must be met in order for the exemption to apply to an employee:
(a) He must be engaged in the processing of sugar beets, sugar-beet molasses, sugarcane, or maple sap.
(b) The product of the processing must be sugar (other than refined sugar) or syrup.
§ 780.816 Processing of specific commodities.
Only the processing of sugar beets, sugar-beet molasses, sugarcane, or maple sap is within the exemption. Operations performed on commodities other than those named are not exempt under this section even though they result in the production of unrefined sugar or syrup. For example, sorghum cane or refinery syrup (which is a byproduct of refined syrup) are not named commodities and employees engaged in processing these products are not exempt under this section even though the resultant product is raw sugar. The loss of exemption would obtain for the same reason for employees engaged in processing sugar, glucose, or ribbon cane syrup into syrup.
§ 780.817 Employees engaged in processing.
Only those employees who are engaged in the processing will come within the exemption. The processing of sugarcane to which the exemption applies and in which the employee must be engaged in order to come within it is considered to begin when the processor receives the cane for processing and to end when the cane is processed “into sugar (other than refined sugar) or syrup.” Employees engaged in the following activities of a sugarcane processing mill are considered to be engaged in “the processing of” the sugarcane into the named products, within the meaning of the exemption:
(a) Loading of the sugarcane in the field or at a concentration point and hauling the cane to the mill “if performed by employees of the mill.” (Such activities performed by employees of some other employer, such as an independent contractor, are not considered to be within the exemption.)
(b) Weighing, unloading, and stacking the cane at the mill yard.
(c) Performing sampling tests (such as a trash test or sucrose content test) on the incoming cane.
(d) Washing the cane, feeding it into the mill crushers and crushing.
(e) Operations on the extracted cane juice in the making of raw sugar and molasses: Juice weighing and measurement, heating, clarification, filtration, evaporating, crystallization, centrifuging, and handling and storing the raw sugar or molasses at the plant during the grinding season.
(f) Laboratory analytical and testing operations at any point in the processing or at the end of the process.
(g) Loading out raw sugar or molasses during the grinding season.
(h) Handling, baling, or storing bagasse during the grinding season.
(i) Firing boilers and other activities connected with the overall operation of the plant machinery during grinding operations, including cleanup and maintenance work and day-to-day repairs. (This includes shop employees, mechanics, electricians, and employees maintaining stocks of various items used in repairs.)
§ 780.818 Employees not engaged in processing.
Employees engaged in operations which are not an integral part of processing of the named commodities will not come within the exemption. The following activities are not considered exempt under section 13(b)(15):
(a) Office and general clerical work.
(b) Feeding and housing millhands and visitors (typically this is called the “boarding house”).
(c) Hauling raw sugar or molasses away from the mill.
(d) Any work outside the grinding season.
§ 780.819 Production must be of unrefined sugar or syrup.
The second part of the section 13(b)(15) exemption is specifically limited to the production “of sugar (other than refined sugar) or syrup.” The production of “refined sugar” a term which is commonly understood to refer to the refinement of “raw sugar” is expressly excluded. Thus, the exemption does not apply to the manufacture of sugar that is produced by melting sugar, purifying the melted sugar solution through a carbon medium process and the recrystallization of the sugar from this solution. Nor does the exemption apply to the processing of cane syrup into refined sugar or to the further processing of sugar, as for example, beet sugar into powdered or liquid sugar.
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