Under Section 13(a)(1) of the act, employers of persons employed "in a bona fide executive, administrative, or professional capacity" (EAP employees) are freed from the act's otherwise applicable minimum wage and overtime pay requirements. On March 31, 2003, the Wage and Hour Division, United States Department of Labor (DOL), proposed revision of the regulations (29 CFR 541) that define the terms executive, administrative and professional and govern implementation of the FLSA exemption. This report sketches the evolution of the Section 13(a)(1) since 1938, noting the occasions on which the regulations governing the exemption (29 CFR 541) were modified. Among them was the following:
The provisions of sections 6 and 7 shall not apply with respect to (1) any employee employed in a bona fide executive, administrative, professional ... capacity ... (as such terms are defined and delimited by regulations of the Administrator....)
The act went on to create within the Department of Labor a sub-unit—the Wage and Hour Division—to be presided over by an Administrator to be "appointed by the President with the advice and consent of the Senate." No earnings threshold was set for a professional. Among the changes in the regulation was an increase in the earnings threshold: to be exempt, an executive was to be paid "on a salary basis at a rate of not less than $55 per week ($30 in Puerto Rico or the Virgin Islands)"; an administrator was to be paid "on a salary or fee basis at a rate of not less than $75 per week ($200 per month in Puerto Rico or the Virgin Islands)"; and a professional was to be paid "on a salary or fee basis at a rate of not less than $75 per week ($200 per month in Puerto Rico or the Virgin Islands)." Special sub-minima were set at $130 per week for executive and administrative employees and at $150 per week for professionals in Puerto Rico, the Virgin Islands, and American Samoa. Reconsidering the Threshold Issue

The process remained open but did not reach fruition. In a Federal Register notice for November 14, 1994, DOL recalled that the thresholds had not been updated since 1975 when they were set "on an interim basis." It stated that it would re-open the comment period—continuing from the Reagan era initiatives of 1985. A New Rule Proposed

On March 31, 2003, Wage and Hour Administrator Tammy McCutchen posted in the Federal Register a "proposed rule with request for comments." Thus, both the Senate and the House were on record with respect to the Harkin amendment and the proposed revision of the Section 13(a)(1) regulation. H.R. 2660 remained in conference, having been by-passed. 2673 ( H.Rept. But, objection was heard. For example, how would a bona fide "professional" be defined for Section 13(a)(1) purposes? It was not added. First responders, it doesn't—it's only white-collar workers. So that is not true. The Secretary then responded more generally. "It was required by the regs." Among them was H.R. SECTION III

	Promulgation of the Final Rule: April 23, 2004

The final rule governing Section 13(a)(1) was published on April 23, 2004. Most bona fide executive, administrative, or professional workers can be expected to earn in excess of $23,660. Above that level, exemption rests, largely, upon the duties test. Fortney praised the "primary duty" test. First . Amending the JOBS Act (S. 1637, H.R. 4520 , DOL's new overtime provisions had already been in place for nearly a month. As debate continued, two perspectives seem to have appeared. Second .
Section 13(a)(1) of the Fair Labor Standards Act permits exemption of employers of bona fide executive, administrative and professional employees from the minimum wage and overtime pay requirements of the act; that is, from the basic wage and hour provisions of the statute. What constitutes a bona fide executive, administrative, or professional employee has been left by Congress for the Secretary of Labor to define and delimit. That process, begun in 1938, lapsed after 1975 and was renewed by the Bush Administration in 2003 (see 29 CFR 541).
The first Section 13(a)(1) regulation appeared in 1938. Inter alia, it imposed two classification tests. First. To qualify as bona fide, a worker had to be paid at a rate befitting an executive or administrator. Second. The worker had to perform the actual work (duties) of an executive or administrator. A salary threshold was set at $30 a week. Initially, professionals were subject only to a duties test. In 1940, an earnings threshold ($50 a week) was set for professionals.
Definitions were modified periodically (both the earnings and duties tests) so that they could serve, credibly, as indicators of who might be deemed an executive, administrator or professional for Section 13(a)(1) purposes. Updates were always contentious. With lower thresholds, greater numbers of workers would find themselves unprotected by the terms of the FLSA. Thus, it was in the interests of employers to keep the thresholds low—and the duties tests as broad as possible. Workers, in turn, sought a higher threshold and a narrow definition of duties.
The last general revision occurred in 1975, but the effort encountered significant objections from employers. In 1978, a further update was proposed; but, in 1981, it was withdrawn by the new Reagan Administration. It never reappeared. The thresholds remain at 1975 levels: $155 per week for executives and administrators and $170 for professionals—with slightly lower levels for Puerto Rico, the Virgin Islands and American Samoa. The duties tests have evolved, slowly, since 1938 but remain heavily anchored in regulations from the act's early history.
On March 31, 2003, Wage/Hour Administrator Tammy McCutchen published in the Federal Register a proposed update of the Section 13(a)(1) regulation. The proposal sparked an intense public and legislative debate. (See, inter alia, H.R. 2660, H.R. 2673, H.R. 2665, H.R. 4520, S. 1485, S. 1611, and S. 1637 of the 108th Congress.) On April 23, 2004, DOL issued the rule in final form (Federal Register, April 23, 2004, pp. 22122-22274) to take effect the last week of August 2004. The new provisions have now been placed in effect. It seems unlikely that any further revisions can be expected to take place for the foreseeable future.
This report sketches the evolution of the Section 13(a)(1) regulation and explores the arguments, pro and con, that it has encountered.