[Code of Federal Regulations]
[Title 29, Volume 3]
[Revised as of July 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 29CFR541.104]

[Page 184-185]
 
                             TITLE 29--LABOR
 
         CHAPTER V--WAGE AND HOUR DIVISION, DEPARTMENT OF LABOR
 
PART 541_DEFINING AND DELIMITING THE TERMS ``ANY EMPLOYEE EMPLOYED IN A 
 
                        Subpart B_Interpretations
 
Sec. 541.104  Department or subdivision.

    (a) In order to qualify under Sec. 541.1, the employee's managerial 
duties must

[[Page 185]]

be performed with respect to the enterprise in which he is employed or a 
customarily recognized department or subdivision thereof. The phrase ``a 
customarily recognized department or subdivision'' is intended to 
distinguish between a mere collection of men assigned from time to time 
to a specific job or series of jobs and a unit with permanent status and 
function. In order properly to classify an individual as an executive he 
must be more than merely a supervisor of two or more employees; nor is 
it sufficient that he merely participates in the management of the unit. 
He must be in charge of and have as his primary duty the management of a 
recognized unit which has a continuing function.
    (b) In the vast majority of cases there is no difficulty in 
determining whether an individual is in charge of a customarily 
recognized department or subdivision of a department. For example, it is 
clear that where an enterprise comprises more than one establishment, 
the employee in charge of each establishment may be considered in charge 
of a subdivision of the enterprise. Questions arise principally in cases 
involving supervisors who work outside the employer's establishment, 
move from place to place, or have different subordinates at different 
times.
    (c) In such instances, in determining whether the employee is in 
charge of a recognized unit with a continuing function, it is the 
division's position that the unit supervised need not be physically 
within the employer's establishment and may move from place to place, 
and that continuity of the same subordinate personnel is not absolutely 
essential to the existence of a recognized unit with a continuing 
function, although in the ordinary case a fixed location and continuity 
of personnel are both helpful in establishing the existence of such a 
unit. The following examples will illustrate these points.
    (d) The projects on which an individual in charge of a certain type 
of construction work is employed may occur at different locations, and 
he may even hire most of his workforce at these locations. The mere fact 
that he moves his location would not invalidate his exemption if there 
are other factors which show that he is actually in charge of a 
recognized unit with a continuing function in the organization.
    (e) Nor will an otherwise exempt employee lose the exemption merely 
because he draws the men under his supervision from a pool, if other 
factors are present which indicate that he is in charge of a recognized 
unit with a continuing function. For instance, if this employee is in 
charge of the unit which has the continuing responsibility for making 
all installations for his employer, or all installations in a particular 
city or a designated portion of a city, he would be in charge of a 
department or subdivision despite the fact that he draws his 
subordinates from a pool of available men.
    (f) It cannot be said, however, that a supervisor drawn from a pool 
of supervisors who supervises employees assigned to him from a pool and 
who is assigned a job or series of jobs from day to day or week to week 
has the status of an executive. Such an employee is not in charge of a 
recognized unit with a continuing function.