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to care for and educate their children or children under

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their guardianship (as the case may be), if such em

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ployee and his spouse (A) are employed to serve as

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the parents of such children who reside in facilities of

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the institution, (B) reside in such facilities and receive,

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without cost, board and lodging from such institution,

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and (C) are together compensated, on a cash basis,

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SEC. 301. (a) Section 6(e) is amended to read as

13 follows:

14 “ (e) Notwithstanding the provisions of section 13 of 15 this Act (except subsections (a) (1) and (f) thereof),

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every employer providing any contract services under

a

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contract with the United States or any subcontract there

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under shall pay to each of his employees whose rate of pay 19 is not governed by the Service Contract Act of 1965 (41 20 U.S.C. 351-357) or to whom subsection (a) (1) of this

21 section is not applicable, wages at a rate not less than the 22 rate provided for in such subsection." 23 (b) Section 8 (29 U.S.C. 208) is amended (1) by 24 striking out "the minimum wage prescribed in paragraph 25 (1) of section 6 (a) in each such industry” in the first

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1 sentence of subsection (a) and inserting in lieu thereof "the 2 minimum wage rate which would apply in each such indus3 try under paragraph (1). or (5) of section 6 (a) but for 4 section 6 (c)”, (2). by striking out "the minimum wage 5. .rate prescribed in paragraph (1) of section 6 (a)” in the 6. last sentence of subsection (a) and inserting in lieu thereof 7. the otherwise applicable minimum wage rate in effect under 8

paragraph (1) or (5) of section 6 (a)”, and (3) by strik9. ing out "prescribed in paragraph (1). of section 6 (a)” in 10

subsection (c) and inserting in lieu thereofi “in effect under 11 paragraph (1) or (5) of section 6 (a) (as the case may

12 be)”.

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EFFECTIVE DATE AND REGULATIONS

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SEC. 302. (a) Except as provided in sections 105 (a), 15

202, and 204, the effective date of this Act and the amend16 ments made by titles I, II, and III of this Act isi

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(1) the first day of the second full month which

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begins after the date of its enactment, or

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(2) August 1, 1973,

20 whichever occurs first.

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(b) Notwithstanding subsection (a), on and after the 22 date of the enactment..of this Act the Secretary of Labor is

23 authorized to prescribe necessary rules, regulations, and

24 orders with regard to the amendments made by this Act.

SECTION-BY-SECTION DESCRIPTION OF H.R. 7935,

AS REPORTED

The following is a description of the changes made in the Fair Labor Standards Act of 1938 (referred to in the description as the "Act") by H.R. 7935 as reported by the committee:

Section 1. Short Title; References to Act.–Subsection (a) provides that the bill when enacted may be cited as the “Fair Labor Standards Amendments of 1973". Subsection (b) is a technical provision.

Title I-Increases in Minimum Wage Rates Section 101. Increase in Minimum Wage Rate for Employees Covered Before 1966.This section amends section 6(a)(1) of the Act to provide an increase in the minimum wage rate for nonagricultural employees covered by the Act prior to the effective date of the 1966 amendments and for Federal employees covered by the 1966 amendments. The minimum wage rate for such employees is raised from not less than $1.60 an hour to (1) not less than $2 an hour beginning on the first day of the second full month after the date of enactment, or August 1, 1973, whichever occurs first, and (2) not less than $2.20 an hour beginning July 1, 1974.

Section 102. Increase in Minimum Wage Rate for Nonagricultural Employees Covered in 1966 and 1973.This section amends section 6(b) of the Act to provide an increase in the minimum wage rate for nonagricultural employees (other than Federal employees) covered by the 1966 and 1973 amendments to the Act. The minimum wage rate for such employees is raised from not less than $1.60 an hour to (1) not less than $1.80 an hour beginning on the first day of the second full month after the date of enactment, or August 1, 1973, whichever occurs first, (2) not less than $2 an hour during the year beginning July 1, 1974, and (3) not less than $2.20 an hour beginning July 1, 1975.

Section 103. Increase in Minimum Wage Rate for Agricultural Employees. This section amends section 6(a)(5), of the Act to provide an increase in the minimum wage rate for agricultural employees covered by the Act. The minimum wage rate for such employees is raised from not less than $1.30 an hour to (1) not less than $1.60 an hour beginning on the first day of the second full month after the date of enactment, or August 1, 1973, whichever occurs first, (2) not less than $1.80 an hour during the year beginning July 1, 1974, (3) not less than $2 an hour during the year beginning July 1, 1975, and (4) not less than $2.20 an hour beginning July 1, 1976.

Section 104. Government, Hotel, Motel, Restaurant, Food Service, and Conglomerate Employees in Puerto Rico and the Virgin Islands. This section amends section 5 of the Act to provide that the minimum wage rate for hotel, motel, restaurant, food service, con

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glomerate, Government of the United States, and Virgin Islands government employees employed in Puerto Rico and the Virgin Islands shall be determined without regard to the wage order provisions of section 6(c) of the Act. Thus, the minimum wage rate for such employees shall be the applicable rate in effect under section 6(a)(1) or 6(b).

Section 105. Increases in Minimum Wage Rates for Other Employees in Puerto Rico and the Virgin Islands.-Subsection (a) of this section amends section 6(c) of the Act to provide for employees in Puerto Rico and the Virgin Islands covered by wage orders issued under that section minimum wage rate increases corresponding to the ones provided mainland United States employees. Except for subsidized agricultural employees (1) the increases are stated in terms of percentages of the most recent wage rate applicable to the employee before the effective date of the 1973 amendments, which wage rate is referred to as the employee's "base rate", and (2) there is continued the authority (described below) for special review committees to be established to provide wage rates different from the increased ones prescribed by section 6(c) (as amended by this section).

Employees covered before 1966.–Subsection (c)(2) of the Act provides for an initial 25 percent increase in the base rate applicable to employees covered by the Act prior to the 1966 amendments. Such increase shall (unless superseded) take effect 60 days after the effective date of the 1973 amendments or 1 year from the effective date of the most recent wage order, whichever is later. One year thereafter, an increase equal to 12.5 percent of the employee's base rate is provided.

Agricultural employees.--Subsection (c)(3)(A) provides for three 15.4 percent increases in the base rate applicable to agricultural employees covered by the Act. Such increase shall (unless superseded) take effect 60 days after the effective date of the 1973 amendments or 1 year from the date of the most recent wage order, whichever is later. One year after the effective date of the first increase an additional increase equal to 15.4 percent of the employee's base rate will take effect, and one year thereafter a third 15.4 percent increase will take effect.

In the case of an agricultural employee whose hourly wage is increased, above that required by a wage order, by a subsidy (or income supplement) paid, in whole or in part, by the Government of Puerto Rico, the three 15.4 percent increases shall be applied (as provided in subsection (c)(3)(B)) to the sum of (1) the employee's base rate and (2) the amount of the subsidy (or income supplement). The increases for these employees will take effect at the same time as the increases for other agricultural employees, but these increases may not be superseded by a wage rate recommended by a review committee.

Nonagricultural employees covered in 1966.-Subsection (c)(4) provides three 12.5 percent increases for nonagricultural employees first covered in 1966. The first 12.5 percent increase will take effect (unless superseded) 60 days after the effective date of the 1973 amendments or 1 year from the effective date of the most recent wage order, whichever is later; the second increase 1 year later; and the third increase 1 year thereafter.

Nonagricultural employees first covered in 1973.-Subsection (c) (5) provides for establishment of special industry committees to recommend minimum wage rates for employees newly covered by the 1973 amendments (other than employees subject to the amendment made by section 104, that is, hotel, motel, restaurant, food service, government, and conglomerate employees).

Wage floor and ceiling.-On and after the effective date of the first increase prescribed under subsection (c)(2), (3), (4), or (5), the minimum wage rate of employees covered by such increase may not be less than 60 percent of the otherwise applicable rate under section 6(a) (pre-1966 mainland employees) or 6(b) (1966 and 1973 nonagricultural employees). In the case of subsidized agricultural employees, the increase prescribed by subsection (c)(3)(B) may not exceed the applicable rate under section 6(a)(5).

Review procedure.—This procedure (first established by the 1961 amendments) permits any employer, or group of employers, employing a majority of the employees in an industry in Puerto Rico or the Virgin Islands to petition the Secretary for the appointment of a special industry committee to recommend the minimum wage rate or rates to be paid such employees in lieu of the rate or rates required as a result of the increases prescribed by subsection (c)(2), (c)(3)(A), or (c) (4), whichever is applicable. T'he Secretary may then appoint a special industry committee if he has reasonable cause to believe that employment in such industry will otherwise be substantially curtailed.

Other amendments.–Subsection (b) amends section 8 of the Act to provide that special industry committees shall recommend the otherwise applicable rate under section 6(a)(1), 6(a)(5), or 6(b) except where substantial documentary evidence, including pertinent financial information, demonstrates an inability to pay such rate. Section 10 (a) of the Act is amended to provide that a court may, in reviewing a wage order issued under section 8, prescribe an appropriate minimum wage rate for the employees covered by such order.

Title II-Extension of Coverage; Revision of Exemptions

Section 201. Federal and State Employees.-Section 201 (a) amends the definitions (in section 3 of the Act) of "employer", "enterpise and "enterprise engaged in commerce or in the production of goods for commerce" to include the United States and any State or political subdivision of a State. These amendments result in the extension of minimum wage and overtime coverage to all Federal, State, and local public employees. Under the amendment made to section 13(b) of the Act, State and local public employees engaged in fire protection or law enforcement activities and Federal employees (other than those covered by the 1966 amendments) are exempt from overtime coverage. Section 18 of the Act is amended to include Federal employees in the Canal Zone under the section 6(a)(1) rate.

Section 202. Transit Employees.-Section 13(b) (7) of the Act is amended to reduce the overtime exemption currently in effect for any driver, operator, or conductor employed by an employer engaged in the business of operating a street, suburban or interurban electric railway, or local trolley or motor bus carrier, whose rates and services are subject to regulation by a State or local agency. During the first year

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