2-14 29 CFR § 541.201. Directly Related to Management or General Business Operations
(a) To qualify for the administrative exemption, an employee's primary duty must be the performance of work directly related to the management or general business operations of the employer or the employer's customers. The phrase "directly related to the management or general business operations" refers to the type of work performed by the employee. To meet this requirement, an employee must perform work directly related to assisting with the running or servicing of the business, as distinguished, for example, from working on a manufacturing production line or selling a product in a retail or service establishment.
(b) Work directly related to management or general business operations includes, but is not limited to, work in functional areas such as tax; finance; accounting; budgeting; auditing; insurance; quality control; purchasing; procurement; advertising; marketing; research; safety and health; personnel management; human resources; employee benefits; labor relations; public relations, government relations; computer network, Internet and database administration; legal and regulatory compliance; and similar activities. Some of these activities may be performed by employees who also would qualify for another exemption.
(c) An employee may qualify for the administrative exemption if the employee's primary duty is the performance of work directly related to the management or general business operations of the employer's customers. Thus, for example, employees acting as advisers or consultants to their employer's clients or customers (as tax experts or financial consultants, for example) may be exempt.
2-14:1 Commentary
2-14:1.1 Duties Must Relate Directly to Management or General Business Operations
A nice summary of this exemption is found in a case from a federal district court in Texas.
• Bollschweiler v. El Paso Co., 166 F. Supp. 3d 808 (W.D. Tex. 2016) (court notes that the distinction between the administration/production dichotomy while useful is not dispositive as is the laundry list of positions listed in the regulation; court's focus is on whether an employee is engaged in running the business itself as opposed to mere day-to-day implementation of the affairs of the business).
The administrative exemption is available when the employee's work relates to general business operations, not in the making or selling of the employer's product. A few general...
