Kells, supervisory and managerial employees are exempt from the FLSA, but so are other groups, e.g., farm laborers (which is why child labor is OK among migrants), food service employees, etc. I never heard of the distinction you mention, whether the employee actually creates a product. The rationale for the exemptions rather reflect a patchwork of special interests. Employers didn't want to have pay overtime to higher-paid managerial and supervisory workers (most of whom are also barred by labor law from union membership!), and they didn't want a minimum wage for food service employees or farm laborers, also they didn't want to ban child labor for farm workers. There's no theory, it's very much special interesr pragmatism. jks   Kelley <jimmyjames@softhome.net> wrote: <BLOCKQUOTE style="PADDING-LEFT: 5px; MARGIN-LEFT: 5px; BORDER-LEFT: #1010ff 2px solid">Hey labor lawyer types (and anyone else), As I understand it, there are three criteria for determining whether an employee is exempt or non-exempt from the FSLA. 1. If someone hold a managerial position, they are exempt. 2. If they are doing highly skilled, professional work. E.g., a computer programmer is usually exempt whereas a computer hardware technician is not. An accountant is exempt, a bookkeeper is non-exempt. 3. If they are in an administrative or sales position. An administrative assistant to a dept chair is exempt, a secretary is non-exempt. An outside sales rep is exempt, an inside sales person is non-exempt. Question: I seem to recall that, in California, maybe the nation overall, the (or one) defining distinction is whether or not an employee actually creates a product from which the company makes a profit. Anyon e ever heard about this or seen a reference to it? What's the rationale behind this if it is the case that it has to do with product? Thanks, Kelley </BLOCKQUOTE> <hr size=1>Do you Yahoo!? <a href="http://rd.yahoo.com/mail/mailsig/*http://mailplus.yahoo.com">Yahoo! Mail Plus</a> - Powerful. Affordable. <a href="http://rd.yahoo.com/mail/mailsig/*http://mailplus.yahoo.com">Sign up now</a>