as its objective the exemption of the "fishery industry", broadly defined. This amendment had been defeated (83 Cong. Rec. 7408), as had an amendment subsequently offered by Congressman Mott of Oregon (to a pending amendment proposed by Congressman Coffee of Nebraska) which would. have provided an exemption for "industries engaged in producing, processing, distributing, or handling *** fishery or seafood products which are seasonal or perishable" (83 Cong. Rec. 7421– 7423). Against this background, when Congressman Bland offered his amendment which ultimately became section 13(a) (5) of the Act he took pains to explain: "This amendment is not the same. In the last amendment I was trying to define the fishery industry. I am now dealing with those persons who are exempt, and I call the attention of the Committee to the language with respect to the employment of persons in agriculture *** I am only asking for the seafood and fishery industry that which has been done for agriculture." It was after this explanation that the amendment was adopted (83 Cong. Rec. 7443). When the conference committee included in the final legislation this provision from the House bill, it omitted from the bill another House provision granting an hour's exemption for "employees in any place of employment" where the employer was "engaged in the processing of or in canning fresh fish or fresh seafood" and the provision of the Senate bill providing an hour's exemption for employees "employed in connection with" the canning or other packing of fish, etc. (see Mitchell v. Stinson, 217 F. 2d 210; McComb v. Consolidated Fisheries, 75 F. Supp. 798). The indication in this legislative history that the exemption in its final form was intended to depend upon the employment of the particular employee in the specified activities is in accord with the position of the Department of Labor and the weight of judicial authority.

Section 784.104 The 1949 amendments.

In deleting employees employed in canning aquatic products from the section 13 (a) (5) exemption and providing them with an exemption in like language from the overtime provisions only in section 13(b) (4), the conferees on the Fair Labor Standards Amendments of 1949 did not indicate any intention to change in any way the category of employees who would be exempt as "em

ployed in the canning of" the aquatic products. As the Supreme Court has pointed out in a number of decisions, "When Congress amended the Act in 1949 it provided that pre-1949 rulings and interpretations by the Administrator should remain in effect unless inconsistent with the statute as amended 63 Stat. 920" (Mitchell v. Kentucky Finance Co., 359 U.S. 290). In connection with this exemption the conference report specifically indicates what operations are included in the canning process (see section 784.143). In a case decided before the 1961 amendments to the Act, this was held to "indicate that Congress intended that only those employees engaged in operations physically essential in the canning of fish, such as cutting the fish, placing it in cans, labelling and packing the cans for shipment are in the exempt category" (Mitchell v. Stinson, 217 F. 2d 210).

Section 784.105 The 1961 amendments.

(a) The statement of the Managers on the Part of the House in the conference report on the Fair Labor Standards Amendments of 1961 (H. Rep. No. 327, 87th Cong., 1st Sess., p. 16) refers to the fact that the changes made in sections 13 (a) (5) and 13(b) (4) originated in the Senate amendment to the House bill and were not in the bill as passed by the House. In describing the Senate provision which was retained in the final legislation, the Managers stated that it "changes the exemption in the act for" the operations transferred to section 13(b) (4) from section 13 (a) (5) "from a minimum wage and overtime exemption to an overtime only exemption." They further stated: "The present complete exemption is retained for employees employed in catching, propagating, taking, harvesting, cultivating, or farming fish and certain other marine products, or in the first processing, canning, or packing such marine products at sea as an incident to, or in conjunction with, such fishing operations, including the going to and returning from work and loading and unloading when performed by such an employee." In the report of the Senate committee on the provision included in the Senate bill (S. Rep. No. 145, 87th Cong., 1st Sess., p. 33), the committee stated: "The bill would modify the minimum wage and overtime exemption in section 13(a) (5) of the act for employees engaged in fishing and in specified activities on aquatic products." In further explanation, the report states that the bill would amend this sec

tion "to remove from this exemption those so-called on-shore activities and leave the exemption applicable to 'offshore' activities connected with the procurement of the aquatic products, including first processing, canning or packing at sea performed as an incident to fishing operations, as well as employment in loading and unloading such products for shipment when performed by any employee engaged in these procurement operations." It is further stated in the report that "persons who are employed in the activities removed from the section 13(a)(5) exemption will have minimum wage protection but will continue to be exempt from the Act's overtime requirements under an amended section 13 (b) (4). The bill will thus have the effect of placing fish processing and fish canning on the same basis under the Act. There is no logical reason for treating them differently and their inclusion within the Act's protection is desirable and consistent with its objectives."

(b) The language of the Managers on the Part of the House in the conference report and of the Senate committee in its report, as quoted above, is consistent with the position supported by the earlier legislative history and by the courts, that the exemption of an employee under these provisions of the Act depends on what he does. The Senate report speaks of the exemption "for employees engaged in fishing and in specified activities" and of the "activities now enumerated in this section". While this language confirms the legislative intent to continue to provide exemptions

for employees employed in specified activities rather than to grant exemption on an industry, employer, or establishment basis (see Mitchell v. Trade Winds, Inc., 289 F. 2d 278), the report also refers with apparent approval to certain prior judicial interpretations indicating that the list of activities set out in the exemption provisions is intended to be "a complete catalog of the activities involved in the fishery industry" and that an employee, to be exempt, need not engage directly in the physical acts of catching, processing, canning, etc. of aquatic products which are included in the operation specifically named in the statute (McComb v. Consolidated Fisheries Co., 174 F. 2d 74). It was stated that an interpretation of section 13(a) (5) and section 13(b) (4) which would include within their purview "any employee who participates in activities which are necessary to the conduct of the operations specifically described in the exemptions" is "consistent with the congressional purpose" of the 1961 amendments. (See Sen. Rep. No. 145, 87th Cong., 1st sess., p. 33; Statement of Representative Roosevelt, 107 Cong. Rec. (daily ed.) p. 6716, as corrected May 4, 1961.) From this legislative history the intent is apparent that the application of these exemptions under the Act as amended in 1961 is to be determined by the practical and functional relationship of the employee's work to the performance of the operations specifically named in section 13 (a) (5) and section 13(b) (4).

Section 784.106 Relationship of employee's work to the named operations.

It is clear from the language of section 13 (a) (5) and section 13(b) (4) of the Act, and from their legislative history as discussed in sections 784.102784.105, that the exemptions which they provide are applicable only to those employees who are "employed in” the named operations. Under the Act as amended in 1961 and in accordance with the evident legislative intent (see section 784.105), an employee will be considered to be "employed in" an operation named in section 13(a) (5) or 13(b) (4) where his work is an essential and integrated step in performing such named operation (see Mitchell v. Myrtle Grove Packing Co., 350 U.S.

cal matter, "employed in" such operations. It is also possible for an employee to come within the exemption provided by section 13 (a) (5) or section 13 (b) (4) even though he does not directly participate in the physical acts which are performed on the enumerated marine products in carrying on the operations which are named in that section of the Act. However, it is not enough to establish the applicability of such an exemption that an employee is hired by an employer who is engaged in one or more of the named operations or that the employee is employed by an establishment or in an industry in which operations enumerated in section 13 (a) (5) or section 13(b) (4) are performed. The relationship between what he does and the performance of the named operations must be examined to determine whether an application of the above-stated principles to all the facts and circumstances will justify the conclusion that he is "employed in" such operations within the intendment of the exemption provision.

Section 784.107 Relationship of employee's work to operations on the specified aquatic products.

It is also necessary to the application of the exexemptions that the operations of which the employee's work is a part be performed on the marine products named in the Act. Thus, the operations described in section 13 (a) (5) must be performed with respect to "any kind of fish, shellfish, crustacea, sponges, seaweeds, or other aquatic forms of animal and vegetable life". The operations enumerated in section 13 (b) (4) must be performed with respect to "any kind of fish, shellfish, or other aquatic forms of animal or vegetable life, or any byproduct thereof". Work performed on products which do not fall within these descriptions is not within the exemptions (Fleming v. Hawkeye Pearl Button Co., 113 F. 2d 52; Mitchell v. Trade Winds, Inc., 289 F. 2d 278; Walling v. Haden, 153 F.2d 196).

Section 784.108 Operations not included in named operations on forms of aquatic "life".

Since the subject matter of the exemptions is concerned with "aquatic forms of animal and vege

table life", the courts have held that the manufacture of buttons from clam shells or the dredging of shells to be made into lime and cement are not exempt operations because the shells are not living things (Fleming v. Hawkeye Pearl Button Co., 113 F. 2d 52; Walling v. Haden, 153 F. 2d 196, certiorari denied 328 U.S. 866). Similarly, the production of such items as crushed shell and grit, shell lime, pearl buttons, knife handles, novelties, liquid glue, isinglass, pearl essence and fortified or refined fish oil is not within these exemptions. Section 784.109 Manufacture of supplies for

named operations is not exempt.

Employment in the manufacture of supplies for the named operations is not employment in the named operations on aquatic forms of life. Thus, the exemption is not applicable to the manufacture of boxes, barrels, or ice by a seafood processor for packing or shipping its seafood products or for use of the ice in its fishing vessels. These operations, when performed by an independent manufacturer, would likewise not be exempt (Dize v. Maddrix, 144 F. 2d 284 (C.A. 4), affirmed 324 U.S. 697, and approved on this point in Farmers' Reservoir Co. v. McComb, 337 U.S. 755). Section 784.110 Performing operations both

on nonaquatic products and named aquatic products.

By their terms, sections 13 (a) (5) and 13(b) (4) provide no exemption with respect to operations performed on any products other than the aquatic products named in these subsections (see section 784.107). Accordingly, neither of the exemptions is applicable to the making of any commodities from ingredients only part of which consist of such aquatic products, if a substantial amount of other products is contained in the commodity so produced (compare Walling v. Bridgeman-Russell Co., 6 Labor Cases 61,422, 2 WH Cases 785 (D. Minn.) and Miller v. Litchfield Creamery Co., 11 Labor Cases 63,247, 5 WH Cases 1039 (N.D. Ind.), with Mitchell v. Trade Winds, Inc., 289 F. 2d 278). Thus, the first processing, canning, or processing of codfish cakes, clam chowder, dog food, crabcakes, or livestock food containing aquatic products is often not exempt within the meaning of the relevant exemptions.