7094 Federal Register / Vol. 62, No. 31 / Friday, February 14, 1997 / Proposed Rules

DEPARTMENT OF LABOR

Wage and Hour Division

29 CFR Parts 520, 521, 522, 523 and

527

RIN 1215–AB10

Employment of Student-Learners,

Employment of Apprentices,

Employment of Learners, Employment

of Messengers, and Employment of

Student Workers

AGENCY: Wage and Hour Division,

Employment Standards Administration,

Labor.

ACTION: Proposed rulemaking and

request for comments.

SUMMARY: The Department of Labor

proposes to remove the regulation found

at 29 CFR Part 527 and consolidate the

regulations found at 29 CFR Parts 520,

521, 522, and 523, into a single Part 520.

These rules were promulgated under

section 14(a) of the Fair Labor Standards

Act (FLSA), and provide for

employment under special certificates

of categories of workers who may be

paid less than the statutory minimum

wage to prevent the curtailment of

employment opportunities. These

workers include apprentices,

messengers and learners, including

student-learners and student-workers.

Employers must apply for special

certificates issued by the Wage and

Hour Division of the U. S. Department

of Labor which state the terms and

conditions of employment at

subminimum wages. Many of the

provisions of these individual

regulations are duplicative and can be

merged into one comprehensive

document. The language and context of

the rules have been simplified,

shortened and formatted to make them

easier to use while the essential

requirements of the regulations have

been maintained. The substantive

criteria used to determine an employer’s

eligibility to receive a certificate under

these programs remains generally

unchanged.

DATES: Comments on the proposed rule

are due April 15, 1997.

ADDRESSES: Submit written comments

to Maria Echaveste, Administrator,

Wage and Hour Division, Employment

Standards Administration, U.S.

Department of Labor, Room S–3502, 200

Constitution Avenue, NW., Washington,

D.C. 20210. Commenters who wish to

receive notification of receipt of

comments are requested to include a

self-addressed, stamped postcard or to

submit them by certified mail, return

receipt requested. As a convenience to

commenters, comments may be

transmitted by facsimile (‘‘FAX’’)

machine to (202) 219–5122. This is not

a toll free number. If transmitted by

FAX and a hard copy is also submitted

by mail, please indicate on the hard

copy that it is a duplicate copy of the

FAX transmission.

FOR FURTHER INFORMATION CONTACT:

Arthur M. Kerschner, Jr., Office of

Enforcement Policy, Child Labor and

Special Employment Team, Wage and

Hour Division, Employment Standards

Administration, U.S. Department of

Labor, Room S–3510, 200 Constitution

Avenue, NW., Washington, D.C. 20210:

telephone (202) 219–7640. This is not a

toll free number. Copies of the Notice of

Proposed Rulemaking (NPRM) in

alternative formats may be obtained by

calling (202) 219–7605, (202) 219–4634

(TDD). The alternative formats available

are large print, electronic file on

computer disk and audio-tape.

SUPPLEMENTARY INFORMATION:

I. Paperwork Reduction Act

This rule contains reporting or

recordkeeping requirements subject to

the Paperwork Reduction Act of 1980

(Pub. L. 96–511), which were previously

approved by the Office of Management

and Budget (OMB) under Regulations,

29 CFR Parts 516 and 522, and assigned

OMB control numbers 1215–0017 and

1215–0012, respectively.

The recordkeeping requirements

contained in these regulations have

been submitted to and approved by

OMB under control number 1215–0017

through May 31, 1998. The

recordkeeping requirements contained

in Regulations, 29 CFR Parts 520, 521,

and 522 and 527 were submitted to,

reviewed and approved by OMB in

conjunction with the basic

recordkeeping requirements contained

in Regulations, 29 CFR Part 516,

Records to be Kept by Employers under

the Fair Labor Standards Act (FLSA).

The reporting requirements contained

in Regulations, 29 CFR Parts 520 (OMB

No. 1215–005), and 522 (OMB No.

1215–0012) have been approved by

OMB. However, in this proposed

rulemaking the Department of Labor

intends to consolidate current 29 CFR

Parts 520, 521, and 522 into a revised

29 CFR Part 520 and eliminate 29 CFR

Part 527. Further, the Department is

proposing to amend the current

Application for a Certificate to Employ

Learners at Subminimum Wages (Form

WH–209) so the form may also be used

to apply for a certificate to employ

messengers at subminimum wages. In

addition, the Department is proposing to

reduce the amount of information

requested on the form which will lessen

the reporting burden on the public.

No application form is required to be

completed by an employer to employ

apprentices at subminimum wages,

however, employers are required to

submit a copy of the apprenticeship

agreement, along with evidence of

registration. Information collection

requirements for approval and

registration of apprenticeship

agreements are contained in

Regulations, 29 CFR Part 29, Labor

Standards for the Registration of

Apprenticeship Programs and have been

approved by OMB under control

number 1205–0023.

The reporting requirements contained

in these proposed regulations have been

submitted for review to OMB pursuant

to section 3507(d) of the Paperwork

Reduction Act of 1995.

A. Title: Application for a Certificate

to Employ Learners/Messengers at

Subminimum Wages, Form WH–209

Summary: These regulations

eliminate Regulations, 29 CFR Part 522

and incorporate the procedures to

obtain a certificate to employ learners/

messengers at subminimum wages into

a revised Part 520.

Need: Section 14(a) of the FLSA

provides, in part, that the Secretary of

Labor, to the extent necessary in order

to prevent curtailment of opportunities

for employment, shall by regulation or

order provide for the employment of

learners and messengers at

subminimum wage rates. This section

also authorizes the Secretary to set

limitations on such employment as to

time, number, proportion and length of

service.

Form WH–209 is an application for a

certificate authorizing an employer to

employ learners and/or messengers at

subminimum wage rates for a period up

to one year. The requirements for

application and issuance of a learner

and/or messenger certificate are set forth

in subpart D of these proposed

Regulations, 29 CFR Part 520.

Form WH–209, Application for a

Certificate to Employ Learners and/or

Messengers at Subminimum Wages, is

completed by an employer (in the case

of messengers, such application may be

filed by an employer or group of

employers), in order to obtain a

certificate authorizing the payment of

learners and/or messengers at a wage

rate less than the Federal minimum

wage. Section 14(a) of FLSA requires

that a certificate be issued before

subminimum wages can be paid to

learners or messengers.
Federal Register / Vol. 62, No. 31 / Friday, February 14, 1997 / Proposed Rules 7095

Respondents and proposed frequency

of response: Learners historically was

one of the largest subminimum wage

programs with over 2,200 certificates

issued in the 1960s. However, since

wage rates have risen in many

industries where certificates were

previously issued and an adequate

supply of experienced workers exists in

these industries, the use of learner

certificates has declined drastically over

the last twenty years. No requests to

employ learners at subminimum wages

have been received since 1995.

The Wage and Hour Division

narrowly defined what type of firm is

eligible to acquire special certificates for

messengers. No applications for

messengers have been received since

1949.

Estimated total annual burden: It is

estimated that it takes approximately 20

minutes to complete a learner/

messenger application. Since there is no

current activity in this program, there is

no annual burden and no respondent

costs.

B. Title: Application to Employ

Student-Learners at Subminimum

Wages, Form WH–205

Summary: Section 14(a) of the FLSA

provides, in part, that the Secretary of

Labor, to the extent necessary in order

to prevent curtailment of opportunities

for employment, shall by regulation or

order provide for the employment of

learners at subminimum wage rates.

This section also authorizes the

Secretary to set limitations on such

employment as to time, number,

proportion and length of service.

Form WH–205 is used by the

employer to obtain certification to

employ student-learners at wages lower

than the Federal minimum wage to

prevent curtailment of opportunities for

employment. Upon joint application by

the employer, the appropriate school

official, and the student-learner, the

application will provide temporary

authority to employ the named studentlearner at a subminimum wage provided

the school official certifies that the

named student will be receiving

instruction in an accredited school and

will be employed pursuant to a bona

fide vocational training program. At the

end of 30 days, this authority is

extended to become the approved

certificate unless the Administrator or

his/her authorized representative denies

the application, issues a certificate with

modified terms and conditions, or

expressly extends the period of review.

The employer must provide a statement

outlining the vocational program and

showing, particularly, the processes in

which the student-learner will be

engaged when in training on the job; a

statement outlining the school

instruction directly related to the job;

the age of the student-learner; and the

period of employment at subminimum

wages. The requirements concerning the

issuance of certificates for studentlearners are contained in proposed

Regulations, 29 CFR 520, Subpart E.

Respondents and proposed frequency

of response: It is estimated that 800

respondents will each use the WH–205

once annually. It is estimated that 30

minutes is required for the respondent

to complete the form. This results in 400

annual reporting burden hours (800

forms X 30 minutes).

All employees of certain enterprises

having workers engaged in interstate

commerce, producing goods for

interstate commerce, or handling,

selling or otherwise working on goods

or materials that have been moved in or

produced for such commerce by any

person are covered by the Fair Labor

Standards Act (FLSA). In addition,

employees of firms which are not

covered enterprises under FLSA may

still be subject to FLSA if they are

individually engaged in interstate

commerce or in the production of goods

for interstate commerce. Accordingly,

the FLSA covers a wide range of

different sizes and types of employers,

from a small retail store, to a farm, to a

large multi-unit manufacturing

enterprise with locations in several

states. Any one of these employers, or

a designated employee, may choose to

complete the application forms

described in this submission. Without

the availability of specific data on those

employers who complete these forms,

the 1995 average hourly rate for

production or nonsupervisory workers

on nonfarm payrolls of $11.46 is being

utilized to determine respondent costs

(Monthly Labor Review, U.S.

Department of Labor, Bureau of Labor

Statistics, April, 1996). Annual

respondent costs are estimated as $4,854

($11.46 × 400 hours). Estimated mailing

costs for 800 applications are $280 (800

×.$.32 postage + 800 × $.03 envelope).

C. Title: Application to Employ

Apprentices at Subminimum Wages

Summary: Section 14(a) of the FLSA

provides, in part, in order to prevent

curtailment of employment

opportunities, for the payment of

special minimum wage rates to workers

employed as apprentices under special

certificates issued by the Department of

Labor.

Need: There is no application form to

be completed by employers to obtain

authority from the Department to

employ apprentices at subminimum

wages. The employer or apprenticeship

committee must submit a copy of the

registered apprenticeship program or

agreement for such apprentices to the

appropriate Regional Office of the Wage

and Hour Division of the Department of

Labor. A registered apprenticeship

program or agreement is one that has

been approved by a recognized

apprenticeship agency as meeting the

basic standards adopted by the

Department of Labor’s Bureau of

Apprenticeship and Training (BAT),

upon the recommendation of the

Federal Committee on Apprenticeship.

A registered apprenticeship program

constitutes a temporary special

certificate authorizing the employment

of an apprentice at the wages and under

the conditions specified in such

program until a special certificate is

issued or denied, provided that within

90 days from the beginning date of the

employment of such apprentices, the

employer or the apprenticeship

committee sends a copy of each

apprenticeship agreement, with

evidence of registration to the

appropriate Regional Office of the Wage

and Hour Division. The requirements

concerning the issuance of certificates

for apprentices are contained in

proposed Regulations, 29 CFR 520,

Subpart D.

Respondents and proposed frequency

of response: Regulations issued by the

BAT no longer permit the payment of

subminimum wages to apprentices in an

approved program (29 CFR 29.5(b)(5)).

Thus, no apprentice certificates have

been issued since 1987.

Estimated total annual burden: We

estimate the submission of a copy of an

approved apprenticeship program to

take approximately one minute.

However, since no apprenticeship

programs are approved by BAT which

employ apprentices at subminimum

rates there is no annual burden and no

respondent costs.

The public is invited to provide

comments on these information

collection requirements so that the

Department of Labor may:

(1) evaluate whether the proposed

collections of information are necessary

for the proper performance of the

functions of the agency, including

whether the information will have

practical utility;

(2) evaluate the accuracy of the

agency’s estimates of the burdens of the

collections of information, including the

validity of the methodology and

assumptions used;

(3) enhance the quality, utility and

clarity of the information to be

collected; and

(4) minimize the burden of the

collections of information on those who

are to respond, including through the
7096 Federal Register / Vol. 62, No. 31 / Friday, February 14, 1997 / Proposed Rules

use of appropriate automated,

electronic, mechanical, or other

technological collection techniques or

other forms of information technology,

e.g., permitting electronic submission of

responses.

Written comments should be sent to

the Office of Information and Regulatory

Affairs, Office of Management and

Budget, Attention: Desk Officer for

Employment Standards Administration,

U.S. Department of Labor, Washington,

DC 20503.

II. Background

Section 14(a) of the FLSA provides for

employment under special certificates

of categories of workers who may be

paid less than the statutory minimum

wage to prevent the curtailment of

employment opportunities. These

workers include messengers, learners

(including student-learners and studentworkers), and apprentices.

Separate regulations were established

for each of these subminimum wage

categories with many provisions

common to all the separate rules. These

rules were also issued before the

enactment of the Administrative

Procedure Act and other laws and

regulations that impact the content of

regulations. The regulations at 29 CFR

Parts 520, 521, 522, 523, and 527 were

promulgated pursuant to FLSA and

establish a certificate system for

employment of these classes of workers

at subminimum wages. Employers must

apply for special certificates issued by

the Wage and Hour Division of the U.S.

Department of Labor, which state the

terms and conditions of employment at

subminimum wages.

Under Part 522, learners may be

employed at less than the applicable

minimum wage in certain skilled

occupations. Certificates specify the

number and proportion of learners

authorized on any date, the

subminimum wage rates permitted

during the learning period, and length

of the learning period in each

occupation (ranging by occupation from

160 to 960 hours, and normally limited

to not more than one year; new or

expanding plants not more than six

months). Certificates are conditioned

upon there being an inadequate supply

of qualified, experienced workers and

the applicant making reasonable efforts

to recruit experienced workers. The use

of learners must not create unfair

competitive labor cost advantages nor

depress wages or working standards for

experienced workers in comparable

work. Employers submit separate

applications for each establishment and

must demonstrate that efforts to hire

experienced workers have been

ineffective.

Under Part 520, student-learners are

pupils at least sixteen years old

(eighteen if employed in certain

hazardous occupations) who are

enrolled in an accredited school, college

or university and who are employed

part-time under a bona fide vocational

training program approved by a State

board of vocational education. Certified

student-learners must be paid at least 75

percent of the applicable minimum

wage, with limits on the number of

hours of employment training each

week at subminimum wages.

Employment of a student-learner must

not have the effect of displacing an

employee of the establishment, nor

depress wages or working standards for

experienced workers in comparable

work, nor impair the development or

continuation of apprenticeship

standards in the occupation or

industries. Separate applications must

be submitted for each student-learner,

describing the vocational training

program in detail and demonstrating

how it relates to the jobs to be

performed by the student-learner.

Under Part 527, student-workers are

pupils enrolled in an educational

institution who are at least 16 years old

(18 if employed in certain hazardous

occupations) and who are employed on

a part-time basis in shops owned by the

educational institution for the purpose

of enabling the students to defray part

of their school expenses. Studentworkers employed under a special

certificate must be paid no less than 75

percent of the applicable minimum

wage. Certificates specify the number of

students authorized on any day, the

rates permitted during the training

period, and length of the training period

for each occupation (not to exceed one

school year). Certificates are submitted

by each educational institution seeking

to employ student-workers.

Under Part 521, apprentices at least

sixteen years old (eighteen if employed

in certain hazardous occupations) may

be employed at less than the applicable

minimum wage in skilled trades under

registered apprenticeship programs.

Apprentices must receive a

progressively increasing schedule of

wages which average at least 50 percent

of the journeyman level rate over the

period of apprenticeship (one year or

more [2,000 or more hours] of work

experience). The Department of Labor’s

Bureau of Apprenticeship and Training

(BAT) establishes criteria and

registration procedures for both

individual apprentices and employer

apprenticeship plans.

Under Part 523, messengers employed

primarily to deliver letters and messages

may be paid subminimum wages to

prevent curtailment of employment

opportunities. Applications may be filed

by an employer or an employee or group

of employers or employees.

The use of these certificates was

prevalent when the wages paid in many

industries were equal to or very near the

minimum wage. As the prevailing wage

rates increased to levels well above the

statutory minimum wage, fewer

employees were willing to work at

subminimum wage rates. Over the last

twenty-five years, very few employers

have applied for special certificates,

except in the student-learner program.

The learner program, which includes

learners, student-learners, and studentworkers, historically was one of the

largest subminimum wage programs. As

wage rates rose in many industries

employing learners and an adequate

supply of experienced workers was

available, the use of learner certificates

declined. At its peak in 1962, over 2,200

certificates covering more than 46,000

learners were issued. The use of

student-learner certificates rose to over

17,000 in 1975, but has fallen in recent

years. Currently less than 800 studentlearner certificates are issued each year.

Because of the narrow focus of the

student-worker program, the most

certificates ever issued was 33 (covering

1,320 workers) in 1961.

About 900 apprentice certificates

were issued in 1967, mostly in the

Caribbean area (838). Regulations issued

by the BAT no longer permit the

payment of subminimum wages to

apprentices. The Wage and Hour

Division, therefore, has not issued any

special certificates for apprentices since

1987.

On March 29, 1976, the Secretary of

Labor presented a report to Congress in

response to the directive of section

4(d)(2) of FLSA to conduct studies on

the justification or lack thereof of each

special exemption issued under section

14 of the Act. The Secretary reported

that section 14(d), added by the 1974

FLSA Amendments, which made

provision for a minimum wage and

overtime exemption without requiring a

special certificate for elementary or

secondary school students employed by

their schools, may have the impact of

eliminating the need for the studentworker program. The Secretary

recommended, however, that section

14(a) continue to make provisions for

special employment of student-workers

until the impact of section 14(d) could

be evaluated.

No regulations regarding the

provisions of section 14(d) were
Federal Register / Vol. 62, No. 31 / Friday, February 14, 1997 / Proposed Rules 7097

promulgated. In the absence of

regulations, the Department decided to

take no action with respect to public or

private elementary or secondary school

students employed by their schools in

various school-related work programs if

their employment complied with the

FLSA child labor provisions. Since

enactment of section 14(d), no studentworker certificates have been issued.

In his report of March 29, 1976, the

Secretary of Labor also recommended

that the provisions authorizing

subminimum wages for messengers be

deleted from the FLSA. He also

determined that the special provisions

for learners could no longer be justified

and should be limited to studentworkers and student-learners. The

report also recommended that the

provisions for apprentices be retained

until the impact of proposed BAT

regulations could be evaluated. No

action was taken on these

recommendations and the section 14

requirements remain in the FLSA; thus

there is a continuing need for these

rules.

III. Summary and Discussion

This rule proposes to remove the

regulation at 29 CFR Part 527,

Employment of Student-Workers, and

reserve the part. Section 14(d) of the

FLSA makes provision for a minimum

wage and overtime exemption for

elementary or secondary school

students employed by their schools

where such employment is an integral

part of the regular education program. In

the absence of regulations regarding

section 14(d), the Department has taken

no action with respect to public or

private elementary or secondary school

students employed by their school in

various school-related work programs if

employed in compliance with the FLSA

child labor provisions. Since section

14(d) of the FLSA was enacted in 1974,

no applications for student-worker

certificates have been submitted by any

type of school, elementary, secondary or

any other. The existing rule is

unnecessary.

This rule proposes to merge the

regulations at 29 CFR Parts 520, 521,

522, and 523 into one new Part 520 and

to reserve the remaining sections. This

proposal eliminates repetition of text

contained in each separate regulation.

Those sections overtaken by

requirements of the Administrative

Procedure Act were also deleted. The

essential requirements contained in the

current regulations are maintained in

this revision. The language and context

of these regulations have been

simplified, shortened, and formatted to

make them easier to understand.

As discussed above, the use of special

certificates to employ messengers,

learners, and apprentices at

subminimum wages has declined

considerably. It is appropriate to replace

extended pages of obsolete regulations

by consolidating these rules. This

proposal, where possible, supplants the

current language containing specific

requirements with more general criteria

common to all of the programs. Since

long-standing regulatory requirements

are being removed, a comment period is

being provided. The Department does

not expect to increase the number of

certificates issued under these proposals

because the economic conditions stated

above are unchanged.

The specific criteria currently

contained in 29 CFR Parts 520, 521, 522,

and 523 will be replaced by the

requirements of 29 CFR Part 520,

subparts D and E. Applicants will be

required to demonstrate that the criteria

for issuance of special certificates have

been met. Those situations where

special certificates will not be issued

have been clarified.

The proposed rule eliminates the

previous industry specific learning

periods for learners and replaces them

with a standardized period of 240 hours

absent extraordinary circumstances

relating to a particular occupation

warranting a longer learning period. It

also removes the different learner

program standards for new plants and

established plants. The Department

welcomes comments from the public

regarding the establishment of a

standardized learning period and

whether 240 hours is an appropriate

length.

The requirement to publish in the

Federal Register a list of learner

certificates issued has been removed as

they are so few in number in recent

years and no purpose is served by the

publication of such a list. Interested

parties may contact the agency for this

information. This proposal removes any

requirement that a hearing be held when

an interested party objects to a

certificate being issued or denied and

replaces it with an informal

reconsideration procedure that is more

responsive to such parties. The period

for requesting reconsideration and

review has been extended to 60 days to

accommodate those programs that

previously required publishing a list of

certificates issued in the Federal

Register. The proposed rule also

removes a section which allowed

nonregistered apprenticeship

agreements to be submitted for

consideration when applying for a

special certificate. Only properly

registered apprenticeship agreements

will be accepted in the future.

The proposed rule permanently fixes,

as the basis for establishing the special

minimum wages that may be paid to

messengers and learners (including

student-learners) under section 14(a),

the minimum wage applicable under

section 6(a). This precludes combining

the use of the youth opportunity wage

established under section 6(g) with the

special minimum wages authorized by

section 14(a). It has been determined

that the minimum wage applicable

under section 6(a), which is greater than

the youth opportunity wage, is both a

necessary and a sufficient basis to

establish special minimum wages which

prevent the curtailment of employment

opportunities as required by section

14(a).

The proposed rule also permanently

sets the subminimum wage rate that

may be paid messengers and learners at

95 percent of the minimum wage

required by section 6(a) of the FLSA.

This reflects the historical difference

between the minimum wage and the

authorized subminimum wage rate for

learners, but it has always been stated

in these sections as a dollar amount (i.e.

$4.10 per hour, $3.65 per hour). By

setting the authorized subminimum

wage at a fixed percentage of the

applicable minimum wage, we will no

longer have to amend these sections

each time the minimum wage is

changed. All certificates issued under

this rule will list the authorized

subminimum wage rate.

The proposal incorporates the

Division’s long-standing policy of

limiting the availability of special

certificates for messengers to those firms

whose principal business is the delivery

of such letters and messages.

The changes discussed above will

have no significant effect on the current

operation of these programs.

Executive Order 12866 and Significant

Regulatory Actions

This rule is not a ‘‘significant

regulatory action’’ within the meaning

of Executive Order 12866. The

consolidation of the current regulations

at 29 CFR Parts 520, 521, 522, and 523,

and the removal of Part 527 does not

affect the current operation of any

program and this action will not: (1)

have an annual effect on the economy

of $100 million or more or adversely

affect in a material way the economy, a

sector of the economy, productivity,

competition, jobs, the environment,

public health or safety, or State, local,

or tribal governments or communities;

(2) create a serious inconsistency or

otherwise interfere with an action taken
7098 Federal Register / Vol. 62, No. 31 / Friday, February 14, 1997 / Proposed Rules

or planned by another agency; (3)

materially alter the budgetary impact of

entitlements, grants, user fees, or loan

programs or the rights and obligations of

recipients thereof; or (4) raise novel

legal or policy issues arising out of legal

mandates, the President’s priorities, or

the principles set forth in Executive

Order 12866. Therefore, no regulatory

impact analysis has been prepared.

Executive Order 12875 and Section 202

of the Unfunded Mandates Reform Act

of 1995

For purposes of the Unfunded

Mandates Reform Act of 1995, as well

as Executive Order 12875, this rule does

not include any federal mandate that

may result in increased expenditures by

either state, local and tribal

governments in the aggregate, or by the

private sector.

Regulatory Flexibility Analysis

This rule will not have a significant

economic impact on a substantial

number of small entities. The

obligations and responsibilities

established under the existing

regulations will remain essentially the

same under the proposed rule. The

Department has certified to this effect to

the Chief Counsel for Advocacy of the

U.S. Small Business Administration.

Therefore, no Regulatory Flexibility

Analysis is required.

Document Preparation: This

document was prepared under the

direction and control of Maria

Echaveste, Administrator, Wage and

Hour Division, Employment Standards

Administration, U.S. Department of

Labor.

List of Subjects

29 CFR Part 520

Minimum wages, Reporting and

recordkeeping requirements, Students,

Wage and Hour Division.

29 CFR Part 521

Manpower training programs,

Minimum wages, Reporting and

recordkeeping requirements, Wage and

Hour Division.

29 CFR Part 522

Cigar and cigarettes, Clothing,

Electronic products, Manpower training

programs, Minimum wages, Reporting

and recordkeeping requirements, Wage

and Hour Division.

29 CFR Part 523

Minimum wages, Wage and Hour

Division.

29 CFR Part 527

Minimum wages, Reporting and

recordkeeping requirements, Students,

Wage and Hour Division.

For the reasons set forth above, 29

CFR Part 520, 29 CFR Part 521, 29 CFR

Part 522, 29 CFR Part 523, and 29 CFR

Part 527 are proposed to be amended as

set forth below.

Signed at Washington, D.C. on the 6th day

of February, 1997.

Maria Echaveste,

Administrator, Wage and Hour Division.

PART 521—[REMOVED AND

RESERVED]

1.–2. Under the authority of Sec. 14,

52 Stat. 1068, as amended, 29 U.S.C.

214, unless otherwise noted, Title 29,

Code of Federal Regulations is proposed

to be amended by removing part 521.

PART 522—[REMOVED AND

RESERVED]

3. Under the authority of Sec. 14, 52

Stat. 1062, 1064 (29 U.S.C. 214); secs. 2–

12, 60 Stat. 237–244 (5 U.S.C. 1001–

1011), 29 U.S.C. 214, Title 29, Code of

Federal Regulations is proposed to be

amended by removing part 522.

PART 523—[REMOVED AND

RESERVED]

4. Under the authority of Sec. 14, 52

Stat. 1068, as amended, 29 U.S.C. 214,

Title 29, Code of Federal Regulations is

proposed to be amended by removing

part 523.

PART 527—[REMOVED AND

RESERVED]

5. Under the authority of Sec. 14, 52

Stat. 1068, as amended, 29 U.S.C. 214,

Title 29, Code of Federal Regulations is

proposed to be amended by removing

part 527.

PART 520—[REVISED]

6. Under the authority of Sec. 14, 52

Stat. 1068, as amended, 29 U.S.C. 214,

Title 29, Code of Federal Regulations is

proposed to be amended by revising

part 520 to read as follows:

PART 520—EMPLOYMENT UNDER

SPECIAL CERTIFICATE OF

MESSENGERS, LEARNERS

(INCLUDING STUDENT-LEARNERS),

AND APPRENTICES

Subpart A—[Reserved]

Subpart B—What Are The General

Provisions Governing the Employment of

Messengers, Learners (Including StudentLearners), and Apprentices at Subminimum

Wages?

Sec.

520.200 What is the legal authority for

payment of wages lower than the

minimum wage required by section 6(a)

of the Fair Labor Standards Act?

520.201 How are those classifications of

workers which may be paid

subminimum wages under section 14(a)

of the Fair Labor Standards Act defined?

520.202 How do persons who want to apply

for a particular certificate find out what

is needed?

520.203 What records does an employer

have to keep when subminimum wage

certificates are granted? How long do

they have to be kept?

520.204 If someone does not agree with the

Department of Labor’s decision on a

certificate, can the decision be appealed?

520.205 How do these rules affect other

Federal, state and local laws and

collective bargaining agreements?

Subpart C—Definitions

Subpart D—Messengers, Learners

(Excluding Student-Learners), and

Apprentices

520.400 Who are messengers, learners, and

apprentices?

520.401 Are there any industries,

occupations, etc. that do not qualify for

a certificate to employ messengers,

learners, or apprentices at subminimum

wages?

520.402 How do I obtain authority to

employ messengers, learners, or

apprentices at subminimum wages?

520.403 What information is required when

applying for authority to pay less than

the minimum wage?

520.404 What must I demonstrate in my

application for a messenger, learner, or

apprentice certificate to receive a

favorable review?

520.405 Must I notify my employees that I

am applying for a certificate to employ

messengers and/or learners at

subminimum wages?

520.406 What happens once I have

submitted my request for authorization

to pay messengers, learners, or

apprentices subminimum wages?

520.407 What is the subminimum wage for

messengers and what must I do to

comply with the terms of my certificate?

520.408 What is the subminimum wage for

learners and what must I do to comply

with the terms of my certificate?

520.409 When will authority to pay

apprentices special minimum wages

become effective and what is the special

minimum wage rate?
Federal Register / Vol. 62, No. 31 / Friday, February 14, 1997 / Proposed Rules 7099

520.410 How long does a messenger,

learner, or apprentice certificate remain

in effect?

520.411 Does a certificate authorizing

payment of subminimum wages to

messengers and/or learners remain in

effect during the renewal process?

520.412 What records, in addition to those

required by part 516 of this chapter and

§ 520.203 of this part, must I keep

relating to the employment of

messengers, learners, or apprentices

under special certificate?

Subpart E—Student-Learners

520.500 Who is a student-learner?

520.501 How do I obtain authority to

employ student-learners at subminimum

wages?

520.502 What information must an

application to employ student-learners at

subminimum wages contain?

520.503 What must I demonstrate in my

application for a student-learner

certificate to receive a favorable review?

520.504 When will authority to pay

student-learners subminimum wages

become effective?

520.505 How will I be notified that my

request to employ student-learners at

subminimum wages has been denied and

can I appeal the denial?

520.506 What is the subminimum wage for

student-learners and what must I do to

comply with the terms of my studentlearner certificate?

520.507 How long does my certificate

remain in effect?

520.508 What records, in addition to those

required by part 516 of this chapter and

§ 520.203 of this part, must I keep when

student-learners are employed?

Authority: Sec. 14, 52 Stat. 1062, 1064 (29

U.S.C. 214); secs. 2–12, 60 Stat. 237–244; (5

U.S.C. 1001–1011); 52 Stat. 1068, as

amended, 29 U.S.C. 214.

PART 520—EMPLOYMENT UNDER

SPECIAL CERTIFICATE OF

MESSENGERS, LEARNERS

(INCLUDING STUDENT-LEARNERS),

AND APPRENTICES

Subpart A—[Reserved]

Subpart B—What Are the General

Provisions Governing the Employment

of Messengers, Learners (Including

Student-Learners), and Apprentices at

Subminimum Wages?

§ 520.200 What is the legal authority for

payment of wages lower than the minimum

wage required by section 6(a) of the Fair

Labor Standards Act?

Section 14(a) of the Fair Labor

Standards Act provides, in order to

prevent curtailment of employment

opportunities, for the payment of

special minimum wage rates to workers

employed as messengers, learners

(including student-learners), and

apprentices under special certificates

issued by the Department of Labor.

§ 520.201 How are those classifications of

workers which may be paid subminimum

wages under section 14(a) of the Fair Labor

Standards Act defined?

(a) A messenger is a worker who is

primarily engaged in delivering letters

and messages for a firm whose principal

business is the delivery of such letters

and messages.

(b) A learner is a worker who is being

trained for an occupation, which is not

customarily recognized as an

apprenticeable trade, for which skill,

dexterity and judgment must be learned

and who, when initially employed,

produces little or nothing of value.

Except in extraordinary circumstances,

an employee cannot be considered a

‘‘learner’’ once he/she has acquired a

total of 240 hours of job-related and/or

vocational training with the same or

other employer(s) or training facility(ies)

during the past three years. An

individual qualifying as a ‘‘learner’’ may

only be trained in two qualifying

occupations.

(c) A student-learner is a student who

is at least sixteen years of age, or at least

eighteen years of age if employed in an

occupation which the Secretary has

declared to be particularly hazardous,

who is receiving instruction in an

accredited school, college or university

and who is employed on a part-time

basis, pursuant to a ‘‘bona fide

vocational training program’’ as defined

in subpart C of this part.

(d) An apprentice is a worker, at least

sixteen years of age unless a higher

minimum age standard is otherwise

fixed by law, who is employed to learn

a skilled trade through a registered

apprenticeship program. Training is

provided through structured on-the-job

training combined with supplemental

related theoretical and technical

instruction. This term excludes preapprentices, trainees, learners, and

student-learners. The terms learner and

student-learner are defined in subpart C

of this part. Standards governing the

registration of apprenticeship programs

are established and administered by the

U. S. Department of Labor, Employment

and Training Administration, Bureau of

Apprenticeship and Training (BAT) and

are found in part 29 of this title.

(e) Additional terms used in this part

are defined in subpart C.

§ 520.202 How do persons who want to

apply for a particular certificate find out

what is needed?

The application process, terms,

conditions and requirements of

certificates and other matters are

discussed in subparts D and E of this

part. Messengers, learners (excluding

student-learners), and apprentices are

discussed in subpart D and studentlearners in subpart E.

§ 520.203 What records does an employer

have to keep when subminimum wage

certificates are granted? How long do they

have to be kept?

(a) In addition to other records

required under the record-keeping

regulations (part 516 of this chapter),

the employer is required to keep records

specific to certification under section

14(a) of the Fair Labor Standards Act.

All workers employed under a

subminimum wage certificate shall be

designated as such on the employer’s

payroll records. Further recordkeeping

requirements are described in each

applicable subpart of this part (see

§§ 520.412 and 520.508).

(b) Employers must maintain and

preserve all required records for at least

three years from the last date of

employment under a subminimum wage

program. The employer’s copy of the

application and the certificate shall also

be maintained for three years. Such

records shall be kept secure and

accessible at the place of employment or

where payroll records are customarily

maintained. All records must be

available for inspection and copying by

the Administrator.

§ 520.204 If someone does not agree with

the Department of Labor’s decision on a

certificate, can the decision be appealed?

(a) Any person, applicant, trade

union, association, etc. who does not

agree with action granting or denying a

certificate (pursuant to §§ 520.406 and

520.505) may, within 60 days of that

action or such additional time as the

Administrator may allow, file with the

Administrator a petition for review. The

decision of the Administrator becomes

final unless such a written request is

timely filed.

(b) Such requests should contain a

statement of the additional evidence

which the person believes may

materially affect the decision and

establish that there were reasonable

grounds for failure to present such

evidence during the original

certification process.

(c) If a request for reconsideration or

review is granted, the Administrator, to

the extent it is deemed appropriate, may

afford other interested persons an

opportunity to present data and views.

(d) The Administrator may conduct

an investigation, which may include a

hearing, prior to taking any action

pursuant to this part.
7100 Federal Register / Vol. 62, No. 31 / Friday, February 14, 1997 / Proposed Rules

§ 520.205 How do these rules affect other

Federal, state and local laws and collective

bargaining agreements?

No provision of this part, or of any

special minimum wage certificate

issued thereunder, shall excuse

noncompliance with any other Federal

or state law or municipal ordinance or

collective bargaining agreement

establishing higher standards.

Subpart C—Definitions

Administrator means the

Administrator of the Wage and Hour

Division, Employment Standards

Administration, United States

Department of Labor, or his/her

authorized representative.

Apparel industry means the

manufacturing of the following products

as referred to in subpart D of this part:

(1) Rainwear means the manufacture

of waterproofed garments and raincoats

from oiled cloth or other materials,

whether vulcanized, rubberized,

cravenetted, or otherwise processed.

(2) Leather and sheep-lined clothing

means the manufacture of leather,

leather-trimmed and sheeplined

garments for men, women or children.

(3) Women’s apparel division of the

apparel industry for the manufacture of

women’s, misses’, and juniors’ dresses

means the production of women’s,

misses’ and juniors’ dresses; washable

service garments; blouses from woven or

purchased knit fabric; women’s, misses’,

children’s and infants’ underwear,

nightwear and negligees from woven

fabrics; corsets and other body

supporting garments from any material;

infants’ and children’s outerwear; and

other garments similar to them.

(4) Robes, means the manufacture of

robes from any woven material or from

purchased knitted materials, including,

without limitation, men’s women’s and

children’s bath, lounging and beach

robes and dressing gowns.

Apprentice means a worker, at least

sixteen years of age unless a higher

minimum age standard is otherwise

fixed by law, who is employed to learn

a skilled trade through a registered

apprenticeship program. Training is

provided through structured on-the-job

training combined with supplemental

related theoretical and technical

instruction. This term excludes preapprentices, trainees, learners, and

student-learners. The terms learner and

student-learner are defined in this

subpart.

Apprenticeship agreement means a

written agreement between an

apprentice and either his/her employer,

or an apprenticeship committee acting

as agent for employer(s), which

agreement contains the terms and

conditions of the employment and

training of the apprentice.

Apprenticeship committee means

those persons designated by the sponsor

to act for it in the administration of the

program. A committee may be ‘‘joint’’,

i.e., it is composed of an equal number

of representatives of the employer(s)

and of the employees represented by a

bona fide collective bargaining agent(s)

and has been established to conduct,

operate, or administer an apprenticeship

program and enter into apprenticeship

agreements with apprentices. A

committee may be ‘‘unilateral’’ or ‘‘nonjoint’’ and shall mean a program

sponsor in which a bona fide collective

bargaining agent is not a participant.

Apprenticeship program means a plan

containing all terms and conditions for

the qualification, recruitment, selection,

employment and training of

apprentices, including such matters as

the requirements for a written

apprenticeship agreement.

BAT means the Bureau of

Apprenticeship and Training,

Employment and Training

Administration, United States

Department of Labor.

Bona fide vocational training program

means a program authorized and

approved by a state board of vocational

education or other recognized

educational body that provides for parttime employment training which may

be scheduled for a part of the work day

or workweek, for alternating weeks or

for other limited periods during the

year, supplemented by and integrated

with a definitely organized plan of

instruction designed to teach technical

knowledge and related industrial

information given as a regular part of

the student-learner’s course by an

accredited school, college, or university.

Department means the United States

Department of Labor.

Experienced worker means a worker

whose total experience in an authorized

learner occupation in the industry,

including vocational training, within

the past three years is equal to 240

hours or such other period as authorized

by a learner certificate issued pursuant

to the regulations in this part.

Experienced worker available for

employment means an experienced

worker residing within the area from

which the plant/business customarily

draws its labor supply or within a

reasonable commuting distance of such

area, and who is willing and able to

accept employment in the plant/

business; or an experienced worker

residing outside of the area from which

the plant/business customarily draws its

labor supply, who has in fact made

himself or herself available for

employment at the plant/business.

FLSA means the Fair Labor Standards

Act of 1938 as amended (29 U.S.C 201

et seq.).

Learner means a worker who is being

trained for an occupation, which is not

customarily recognized as an

apprenticeable trade, for which skill,

dexterity and judgment must be learned

and who, when initially employed

produces little or nothing of value.

Except in extraordinary circumstances,

an employee cannot be considered a

‘‘learner’’ once he/she has acquired a

total of 240 hours of job-related and/or

vocational training with the same or

other employer(s) or training facility(ies)

during the past three years. An

individual qualifying as a ‘‘learner’’ may

only be trained in two qualifying

occupations.

Learning period means a period of

time measured in work hours and

vocational training hours that is

normally required to fully train an

inexperienced worker in a particular

occupation within an industry where

the learner is employed. The learning

period will not exceed 240 hours for any

qualifying occupation except in

extraordinary circumstances where the

employer demonstrates that the

occupation to be learned requires an

extended period of specialized training.

Men’s and boys’ clothing industry

means the industry which manufactures

men’s, youths’, and boys’ suits, coats,

and overcoats.

Messenger means a worker who is

primarily engaged in delivering letters

and messages for a firm whose principal

business is the delivery of such letters

and messages.

Minimum wage means the wage rate

required by section 6 of FLSA. For

purposes of this part, subminimum

wage rates are based exclusively on the

applicable minimum wage provided by

section 6(a).

Recognized apprenticeship agency

means either a state apprenticeship

agency recognized by the BAT, or if no

such apprenticeship agency exists in the

state, the BAT.

Registered apprenticeship program or

agreement means a program or

agreement which has been approved by

a recognized apprenticeship agency as

meeting the basic standards of

apprenticeship adopted and published

by BAT.

Secretary or Secretary of Labor means

the Secretary of Labor, United States

Department of Labor or his/her

authorized representative.

Shoe manufacturing industry means

the manufacture or partial manufacture

of footwear from any material and by
Federal Register / Vol. 62, No. 31 / Friday, February 14, 1997 / Proposed Rules 7101

any process except knitting, vulcanizing

of the entire article or vulcanizing (as

distinct from cementing) of the sole to

the upper, including the manufacturing

of the following: athletic shoes; boots;

boot tops; burial shoes; custom-made

boots or shoes; moccasins; puttees,

except spiral puttees; sandals; shoes

completely rebuilt in a shoe factory;

slippers. This term also includes the

manufacture from leather or from any

shoe-upper material of all cut stock and

findings for footwear, including bows,

ornaments, and trimmings. It also

includes the manufacture of cutsoles;

midsoles; insoles; taps; lifts; rands;

toplifts; bases; shanks; boxtoes;

counters; stays; stripping; sock linings;

and heel pads. Shoe manufacturing also

includes the manufacture of heels from

any material except molded rubber, but

not including the manufacture of

woodheel blocks; the manufacture of cut

upper parts for footwear, including

linings, vamps and quarters; and the

manufacture of pasted shoe stock; as

well as the manufacture of boot and

shoe patterns. However, the

manufacture of cut stock and findings is

included within this definition only

when performed by companies engaged

in the production of shoes who

incorporate most of the cut stock and

findings in the manufacture of their

product(s).

Skilled trade means an apprenticeable

occupation which possesses all of the

following characteristics:

(1) It is customarily learned in a

practical way through a structured,

systematic program of on-the-job

supervised training.

(2) It is clearly identified and

commonly recognized throughout an

industry.

(3) It involves manual, mechanical or

technical skills and knowledge which

require a minimum of 2,000 hours of onthe-job work experience.

(4) It requires related instruction to

supplement the on-the-job training.

(5) It is not merely a part of an

apprenticeable occupation and does not

fall into any of the following categories:

marketing; sales administration;

administrative support; executive and

managerial; professional and semiprofessional occupations (this category

covers occupations for which entrance

requirements customarily include

education of college level).

Standards of apprenticeship means

the apprenticeship program is an

organized, written plan embodying the

terms and conditions of employment,

training, and supervision of one or more

apprentices in the apprenticeable

occupation, which meets the

requirements established by BAT, and is

subscribed to by a sponsor who has

undertaken to carry out the apprentice

training program.

State means any state of the United

States or the District of Columbia or any

territory or possession of the United

States.

Student-learner means a student who

is at least sixteen years of age, or at least

eighteen years of age if employed in an

occupation which the Secretary has

declared to be particularly hazardous,

who is receiving instruction in an

accredited school, college or university

and who is employed by an

establishment on a part-time basis,

pursuant to a bona fide vocational

training program.

Subminimum wage means the rates

which may be paid under temporary

authorization or under certificate as

provided by section 14(a) of FLSA and

this part.

Vocational Training Program. See

‘‘Bona fide vocational training

program’’.

Wage and Hour Division means the

Wage and Hour Division, Employment

Standards Administration, United States

Department of Labor.

Subpart D—Messengers, Learners

(Excluding Student-Learners), and

Apprentices

§ 520.400 Who are messengers, learners,

and apprentices?

The terms messenger, learner, and

apprentice are defined in subpart C of

this part.

§ 520.401 Are there any industries,

occupations, etc. that do not qualify for a

certificate to employ messengers, learners,

or apprentices at subminimum wages?

(a) Certificates to employ messengers

at subminimum wages are available to

only those establishments engaged in

the business of providing messenger

service, i.e., the delivery of letters and

messages. Requests for such certificates

are uniformly denied to applicants

whose principal business purpose is not

the delivery of messages and letters.

(b) All applications for special

certificates authorizing the employment

of learners at subminimum wage rates in

the manufacture of products in the

following industries shall be denied

(definitions for all listed activities can

be found in subpart C of this part):

(1) In the apparel industry:

(i) Rainwear;

(ii) Leather and sheep-lined clothing;

(iii) Women’s apparel division of the

apparel industry for the manufacture of

women’s, misses’, and juniors’ dresses;

(iv) Robes;

(2) Shoe manufacturing industry; and

(3) Men’s and boys’ clothing industry.

(c) No certificates will be granted

authorizing the employment of learners

at subminimum wage rates as

homeworkers; in maintenance

occupations such as guard, porter, or

custodian; in office and clerical

occupations in any industry; or in

operations of a temporary or sporadic

nature.

(d) Authorization to employ

apprentices at subminimum wages will

only be granted if permitted by the BAT

regulations (29 CFR part 29).

§ 520.402 How do I obtain authority to

employ messengers, learners, or

apprentices at subminimum wages?

(a) Employers wishing to employ

messengers, learners, or apprentices as

defined in subpart C of this part at

subminimum wages must apply for

authority to do so from the

Administrator at the Wage and Hour

Division’s Regional Office having

administrative jurisdiction over the

geographic area in which the

employment is to take place. To obtain

the address of the Regional Office which

services your geographic area, please

contact your local Wage and Hour Office

(under ‘‘Department of Labor’’ in the

blue pages of your local telephone

book).

(b) In the case of messengers, such

application may be filed by an employer

or group of employers. Preferential

consideration will be given to

applications filed by groups or

organizations which are deemed to be

representative of the interests of a whole

industry or branch thereof.

§ 520.403 What information is required

when applying for authority to pay less than

the minimum wage?

(a) A separate application must be

made for each plant or establishment

requesting authorization for

employment of messengers and/or

learners at subminimum wages, on the

official form furnished by the Wage and

Hour Division, containing all

information required by the form

including:

(1) Information concerning efforts

made by the applicant to obtain

experienced workers in occupation(s)

for which learners are requested;

(2) The occupations/industry in

which the messenger(s) and/or

learner(s) are to be employed;

(3) A statement explaining why

employment of messenger(s) and/or

learner(s) at subminimum wages is

needed to prevent curtailment of

employment opportunities;

(4) The number of messengers and/or

learners the applicant anticipates

employing at subminimum wages under

special certificate;
7102 Federal Register / Vol. 62, No. 31 / Friday, February 14, 1997 / Proposed Rules

(5) If requesting authorization for the

employment of learners at subminimum

wages for a learning period greater than

240 hours, information pertinent to the

extraordinary circumstances

necessitating such a request. While each

such request will be considered on its

own merit, it is anticipated that such

authorizations would be limited to

occupations requiring an extended

period of specialized training;

(6) The number of messengers and/or

learners hired at subminimum wages

during the twelve-month period prior to

making application;

(7) Total number of nonsupervisory

workers in the particular plant or

establishment for which a certificate is

requested;

(8) The number of experienced

workers in the learner occupations and

their straight-time average hourly

earnings during the last payroll period

and the corresponding payroll period in

the prior year; and

(9) The type of equipment to be used

by learners.

(b) For apprentices, the employer or

apprenticeship committee must submit

a copy of the registered apprenticeship

program.

(c) Any applicant may also submit

such additional information as may be

pertinent. Applications which fail to

provide the information required by the

form may be returned to the applicant

with a notation of deficiencies and

without prejudice against submission of

a new or revised application.

§ 520.404 What must I demonstrate in my

application for a messenger, learner, or

apprentice certificate to receive a favorable

review?

(a) The application must demonstrate

that a certificate is necessary in order to

prevent the curtailment of opportunities

for employment.

(b) The issuance of a messenger and/

or learner certificate must not tend to

create unfair competitive labor cost

advantages nor have the effect of

impairing or depressing wage rates or

working standards of experienced

workers performing work of a like or

comparable character in the industry.

(c) Abnormal labor conditions such as

a strike, lock-out, or other similar

condition, must not exist at the plant or

establishment for which a messenger

and/or learner certificate is requested.

(d) It must be shown that an adequate

supply of qualified experienced workers

is not available for employment in those

occupations for which authorization to

pay subminimum wages to learners has

been requested; that the experienced

workers presently employed in the plant

or establishment in occupations in

which learners are requested are

afforded an opportunity, to the fullest

extent possible, for full-time

employment upon completion of the

learning period; and that learners are

available for employment.

(e) Reasonable efforts must have been

made to recruit workers paid at least the

minimum wage in those occupations in

which certificates to employ learners at

subminimum wages have been

requested. This includes the placement

of an order with the local State or

Territorial Public Employment Service

Office (except in possessions where

there is no such office) not more than

fifteen days prior to the date of

application. Written evidence from such

office that the order has been placed

shall be submitted by the employer with

the application.

(f) The occupation or occupations in

which learners are to receive training

must involve a sufficient degree of skill

to necessitate an appreciable learning

period.

(g) An apprenticeship program must

conform with or substantially conform

with the standards of apprenticeship as

defined in subpart C of this part.

(h) There must be no serious

outstanding violations involving the

employee(s) for whom a certificate is

being requested nor any serious

outstanding violations of a certificate

previously issued, nor any serious

violations of the FLSA which provide

reasonable grounds to conclude that the

terms of a certificate may not be

complied with, if issued.

§ 520.405 Must I notify my employees that

I am applying for a certificate to employ

messengers and/or learners at subminimum

wages?

Upon making application for a

messenger and/or learner certificate or

for renewal thereof, an employer shall

post a copy of the first page of the

completed application form in a

conspicuous place in each department

of the plant or establishment where he/

she proposes to employ messengers

and/or learners at subminimum wage

rates. Such notice shall remain posted

until the application is acted upon by

the Administrator.

§ 520.406 What happens once I have

submitted my request for authorization to

pay messengers, learners, or apprentices

subminimum wages?

(a) All applications submitted for

authorization to pay wages lower than

those required by section 6(a) of the

FLSA will be considered and acted

upon (issued or denied) subject to the

conditions specified in §§ 520.403 and

520.404.

(b) If, in the case of messengers and/

or learners, available information

indicates that the requirements of this

part are satisfied, the Administrator

shall issue a special certificate which

will be mailed to to the employer. If a

special certificate is denied, the

employer shall be given written notice

of the denial. If a messenger and/or

learner certificate is denied, notice of

such denial shall be without prejudice

to the filing of any subsequent

application.

(c) If, in the case of apprentices, the

apprenticeship agreement and others

available information indicate that the

requirements of this part are satisfied,

the Administrator shall issue a special

certificate. The special certificate, if

issued, shall be mailed to the employer

or the apprenticeship committee and a

copy shall be mailed to the apprentice.

If a special certificate is denied, the

employer or the apprenticeship

committee, the apprentice and the

recognized apprenticeship agency shall

be given written notice of the denial.

The employer shall pay the apprentice

the minimum wage applicable under

section 6(a) of the FLSA from the date

of receipt of notice of such denial.

§ 520.407 What is the subminimum wage

for messengers and what must I do to

comply with the terms of my certificate?

(a) A messenger certificate, if issued,

shall specify:

(1) The subminimum wage rate of not

less than 95 percent of the applicable

minimum wage required by section 6(a)

of the FLSA; and

(2) The effective and expiration dates

of the certificate.

(b) The employer shall post a copy of

the messenger certificate during its

effective period in a conspicuous place

where it can be readily seen by

employees.

(c) No messenger shall be hired under

a messenger certificate while abnormal

labor conditions such as a strike, lockout, or other similar condition, exist.

§ 520.408 What is the subminimum wage

for learners and what must I do to comply

with the terms of my certificate?

(a) All learner certificates shall

specify:

(1) The subminimum wage rate of not

less than 95 percent of the applicable

minimum wage required by section 6(a)

of the FLSA;

(2) The number or proportion of

learners authorized to be employed on

any one day;

(3) The occupations in which learners

may be employed;

(4) The authorized learning period of

not more than 240 hours, except in
Federal Register / Vol. 62, No. 31 / Friday, February 14, 1997 / Proposed Rules 7103

extraordinary situations as discussed in

§ 520.403; and

(5) The effective and expiration dates

of the certificate.

(b) Learners properly hired prior to

the date on which a learner certificate

expires may be continued in

employment at subminimum wage rates

for the duration of their authorized

learning period under the terms of the

certificate, even though the certificate

may expire before the learning period is

completed.

(c) The employer shall post a copy of

the learner certificate during its effective

period and thereafter until all

authorized learners have completed

their learning period(s). The certificate

shall be posted in a conspicuous place

in each department of the plant where

learners are to be employed.

(d) No learners shall be hired under

a learner certificate if, at the time the

employment begins, experienced

workers capable of equaling the

performance of a worker of minimum

acceptable skill are available for

employment. Before hiring learners

during the effective period of the

certificate, the employer shall place an

order for experienced workers with the

local State or Territorial Public

Employment Service Office (except in

possessions where there is no such

office) or have such an active order on

file. Written evidence that an order has

been placed or is on active file shall be

maintained in the employer’s records.

(e) No learner shall be hired under a

learner certificate while abnormal labor

conditions such as a strike, lock-out, or

other similar condition exist in the plant

or establishment.

(f) For each individual learner, the

number of hours of previous

employment and hours of vocational or

similar facility(ies) training must be

deducted from the authorized learning

period if within the past three years the

learner has been employed or received

vocational training in a given

occupation and industry.

(g) If experienced workers are paid on

a piece rate basis, learners shall be paid

at least the same piece rates as

experienced workers employed on

similar work in the plant and shall

receive earnings based on such piece

rates whenever such earnings exceed

the subminimum wage rates permitted

in the certificate.

§ 520.409 When will authority to pay

apprentices special minimum wages

become effective and what is the special

minimum wage rate?

(a) An apprenticeship program which

has been registered with a recognized

apprenticeship agency shall constitute a

temporary special certificate authorizing

the employment of an apprentice at the

wages and under the conditions

specified in such program until a

special certificate is issued or denied.

This temporary authorization is,

however, conditioned on the

requirement that within 90 days from

the beginning date of employment of the

apprentice, the employer or the

apprenticeship committee shall send

one copy of each apprenticeship

agreement, with evidence of

registration, to the appropriate Regional

Office of the Wage and Hour Division.

(b) The wage rate specified by the

apprenticeship program becomes the

special minimum wage rate that must be

paid unless the Administrator issues a

certificate modifying the terms and

conditions of employment of

apprentices at special minimum wages.

§ 520.410 How long does a messenger,

learner, or apprentice certificate remain in

effect?

(a) Messenger and/or learner

certificates may be issued for a period

of not longer than one year.

(b) Each special apprentice certificate

shall specify the conditions and

limitations under which it is granted,

including the periods of time during

which subminimum wage rates may be

paid pursuant to a registered

apprenticeship program.

(c) No certificate may be issued

retroactively.

(d) The Administrator may amend the

provisions of a certificate when

necessary to correct omissions or defects

in the original certificate or reflect

changes in this part.

§ 520.411 Does a certificate authorizing

payment of subminimum wages to

messengers and/or learners remain in effect

during the renewal process?

(a) Application for renewal of a

messenger and/or learner certificate

shall be made on the same form as

described in this section and employees

shall be advised of such renewal

application in the same manner as

explained in § 520.405. No effective

messenger and/or learner certificate

shall expire until action on an

application for renewal shall have been

finally determined, provided that such

application has been properly executed

in accordance with the requirements,

and filed with and received by the

Administrator not less than fifteen nor

more than thirty days prior to the

expiration date. A final determination

means either the granting of or initial

denial of the application for renewal of

a messenger and/or learner certificate,

or withdrawal of the application. A

‘‘properly executed application’’ is one

which contains the complete

information required on the form, and

the required certification by the

applicant.

(b) A renewal certificate will not be

issued unless there is a clear showing

that the conditions set forth in § 520.404

still prevail.

§ 520.412 What records, in addition to

those required by part 516 of this chapter

and § 520.203 of this part, must I keep

relating to the employment of messengers,

learners, or apprentices under special

certificate?

(a) Each worker employed as a

messenger, learner, or apprentice under

a certificate shall be designated as such

on the employer’s payroll records. All

such messengers, learners, or

apprentices shall be listed together as a

separate group on the payroll records,

with each messenger’s, learner’s, or

apprentice’s occupation being shown.

(b) At the time learners are hired, the

employer shall also obtain and keep in

his/her records a statement signed by

each employee showing all applicable

experience which the learner had in the

employer’s industry, including

vocational training, during the

preceding three years. The statement

shall contain the dates of such previous

employment, names and addresses of

employers, the occupation or

occupations in which the learner was

engaged and the types of products upon

which the learner worked. The

statement shall also contain information

concerning pertinent training in

vocational training schools or similar

training facilities, including the dates of

such training and the identity of the

vocational school or training facility. If

the learner has had no applicable

experience or pertinent training, a

statement to that effect signed by the

learner shall likewise be kept in the

employer’s records.

(c) The employer shall maintain a file

of all evidence and records, including

any correspondence, pertaining to the

filing or cancellation of job orders

placed with the local State or Territorial

Public Employment Service Office

pertaining to job orders for occupations

to be performed by learners.

(d) Every employer who employs

apprentices under temporary or special

certificates shall preserve for three years

from the last effective date of the

certificate copies of the apprenticeship

program, apprenticeship agreement and

special certificate under which such an

apprentice is employed.

(e) Every apprenticeship committee

which holds a certificate under this part

shall keep the following records for each

apprentice under its control and

supervision:
7104 Federal Register / Vol. 62, No. 31 / Friday, February 14, 1997 / Proposed Rules

(1) The apprenticeship program,

apprenticeship agreement and special

certificate under which the apprentice is

employed by an employer;

(2) The cumulative amount of work

experience gained by the apprentice, in

order to establish the proper wage at the

time of his/her assignment to an

employer; and

(3) A list of the employers to whom

the apprentice was assigned and the

period of time he/she worked for each

employer.

(f) The records required in this

section, including a copy of the

application(s) submitted and any special

certificate(s) issued, shall be kept and

made available for inspection for at least

three years from the expiration date of

the certificate(s).

Subpart E—Student-Learners

§ 520.500 Who is a student-learner?

The term student-learner is defined in

subpart C.

§ 520.501 How do I obtain authority to

employ student-learners at subminimum

wages?

(a) Employers wishing to employ

student-learners at subminimum wages

must apply for authority to do so from

the Administrator at the Wage and Hour

Division’s Regional Office having

administrative jurisdiction over the

geographic area in which the

employment is to take place. To obtain

the address of the Regional Office which

services your geographic area, please

contact your local Wage and Hour Office

(under ‘‘Department of Labor’’ in the

blue pages of your local telephone

book).

(b) Application must be made on the

official form furnished by the Wage and

Hour Division and must be signed by

the employer, the appropriate school

official and the student-learner. A

separate application must be filed by the

employer for each student-learner the

employer proposes to employ at

subminimum wages.

§ 520.502 What information must an

application to employ student-learners at

subminimum wages contain?

Student-learner applications must

contain:

(a) A statement clearly outlining the

vocational training program and

showing, particularly, the processes in

which the student-learner will be

engaged when in training on the job;

(b) A statement clearly outlining the

school instruction directly related to the

job;

(c) The total number of workers

employed in the establishment;

(d) The number and hourly wage rates

of experienced workers employed in the

occupation in which the student-learner

is to be trained;

(e) The hourly wage rate or

progressive wage schedule which the

employer proposes to pay the studentlearner;

(f) The age of the student-learner;

(g) The period of employment training

at subminimum wages;

(h) The number of hours of

employment training a week and the

number of hours of school instruction a

week;

(i) A certification by the appropriate

school official that the student named

on the application form will be

receiving instruction in an accredited

school, college, or university and will be

employed pursuant to a bona fide

vocational training program, as defined

in subpart C of this part. The

certification by the school official must

satisfy the following conditions:

(1) The application must be properly

executed in conformance with

§ 520.501;

(2) The employment training must

conform with the provisions of

§ 520.503 (a), (c), (d), and (g) and

paragraphs (a) and (c) of § 520.506;

(3) The occupation must not be one

for which a student-learner application

was previously submitted by the

employer and a special certificate was

denied by the Administrator.

§ 520.503 What must I demonstrate in my

application for a student-learner certificate

to receive a favorable review?

Each student-learner application must

demonstrate that:

(a) The training program under which

the student-learner will be employed is

a bona fide vocational training program

as defined in subpart C of this part;

(b) The employment of the studentlearner at subminimum wages

authorized by the special certificate

must be necessary to prevent

curtailment of opportunities for

employment;

(c) The student-learner is at least

sixteen years of age, or at least eighteen

years of age if employed in any

occupation which the Secretary has

declared to be particularly hazardous

(see part 570, subpart E, of this chapter,

but note the specific exemptions for

student-learners in several of the

orders);

(d) The occupation for which the

student-learner is receiving preparatory

training requires a sufficient degree of

skill to necessitate a substantial learning

period;

(e) The training is not for the purpose

of acquiring manual dexterity and high

production speed in repetitive

operations;

(f) The employment of a studentlearner will not have the effect of

displacing a worker employed in the

establishment;

(g) The employment of the studentlearners at subminimum wages must not

tend to impair or depress the wage rates

or working standards established for

experienced workers for work of a like

or comparable character;

(h) The occupational needs of the

community or industry warrant the

training of student-learners;

(i) There are no serious outstanding

violations of the provisions of a studentlearner certificate previously issued to

the employer, or serious violations of

any other provisions of the FLSA by the

employer which provide reasonable

grounds to conclude that the terms of

the certificate would not be complied

with, if issued;

(j) The issuance of such a certificate

would not tend to prevent the

development of apprenticeship

programs in accordance with the

regulations applicable thereto (subpart

D of this part) or would not impair

established apprenticeship standards in

the occupation or industry involved;

and

(k) The number of student-learners to

be employed in one establishment is not

more than a small proportion of its work

force.

§ 520.504 When will authority to pay

student-learners subminimum wages

become effective?

(a) Certification by the appropriate

school official on an application for a

special student-learner certificate shall

constitute a temporary authorization.

This temporary authorization is

effective from the date such application

is forwarded to the Wage and Hour

Division in conformance with § 520.501.

(b) At the end of 30 days, this

application shall become the permanent

special student-learner certificate

unless, after review, the Administrator

denies the application, issues a

certificate with modified terms and

conditions, or expressly extends the

period of review.

§ 520.505 How will I be notified that my

request to employ student-learners at

subminimum wages has been denied and

can I appeal the denial?

(a) If, after review, an application is

denied, notification of denial will be

made to the appropriate school official,

the employer and the student. This

notification will occur within 30 days

following the date such application was

forwarded to the Wage and Hour

Division, unless additional time for
Federal Register / Vol. 62, No. 31 / Friday, February 14, 1997 / Proposed Rules 7105

review is considered necessary or

appropriate.

(b) If additional time for review is

considered necessary or appropriate, the

proper school official, the employer,

and the student shall be so notified. To

the extent feasible, the Administrator

may provide an opportunity to other

interested persons to present data and

views on the application before denying

a special student-learner certificate.

(c) Whenever a notification of denial

is mailed to the employer, such denial

shall be without prejudice to any

subsequent application, except under

the circumstances referred to in

§ 520.502(i)(3).

(d) Section 520.204 describes the

procedures for requesting

reconsideration of a decision to grant or

deny a certificate.

§ 520.506 What is the subminimum wage

for student-learners and what must I do to

comply with the terms of my studentlearner certificate?

(a) The special minimum wage rate

paid to student-learners shall be not less

than 75 percent of the applicable

minimum under section 6(a) of the

FLSA.

(b) Compliance with items listed for

favorable review of a student-learner

application (§ 540.503) must be

demonstrated.

(c) (1) The number of hours of

employment training each week at

subminimum wages pursuant to a

certificate, when added to the hours of

school instruction, shall not exceed 40

hours, except that authorization may be

granted by the Administrator for a

greater number of hours if found to be

justified by extraordinary

circumstances.

(2) When school is not in session on

any school day, the student-learner may

work a number of hours in addition to

the weekly hours of employment

training authorized by the certificate;

provided,

(i) The total hours worked shall not

exceed 8 hours on any such day, and

(ii) A notation shall be made in the

employer’s records to the effect that

school not being in session was the

reason additional hours were worked on

such day.

(3) During the school term, when

school is not in session for the entire

week, the student-learner may work at

his/her employment training a number

of hours in the week in addition to those

authorized by the certificate; provided,

(i) The total hours shall not exceed 40

hours in any such week, and

(ii) A notation shall be made in the

employer’s records to the effect that

school not being in session was the

reason additional hours were worked in

such week.

(d) A special student-learner

certificate shall not constitute

authorization to pay a subminimum

wage rate to a student-learner in any

week in which he/she is employed for

a number of hours in addition to the

number authorized in the certificate,

except as provided in paragraphs (c)(1),

(2), and (3) of this section.

§ 520.507 How long does my certificate

remain in effect?

(a) A special student-learner

certificate shall be effective for a period

not to exceed the length of one school

year unless a longer period is found to

be justified by extraordinary

circumstances. These circumstances

must be explained in detail at the time

of application. While each such request

will be considered on its own merit, it

is anticipated that such authorizations

would be limited to occupations

requiring an extended period of

specialized training;

(b) No certificate shall authorize

employment training beyond the date of

graduation.

(c) No special student-learner

certificate may be issued retroactively.

§ 520.508 What records, in addition to

those required by part 516 of this chapter

and § 520.203 of this part, must I keep when

student-learners are employed?

Any worker employed as a studentlearner shall be identified as such on the

payroll records, with each studentlearner’s occupation and rate of pay

being shown. Notations should be made

in the employer’s records when

additional hours are worked by reason

of school not being in session.

[FR Doc. 97–3597 Filed 2–13–97; 8:45 am]

BILLING CODE 4510–27–P