National Employment Law Project

D. Service advisors working for auto and boat dealerships, at 73 Fed. Reg. 43670-71
29 U.S.C. §213(b)(10)(A) exempts from the overtime requirements of the FLSA “any salesman,
partsman, or mechanic primarily engaged in selling or servicing automobiles, trucks, or farm
implements, if he is employed by a non-manufacturing establishment primarily engaged in the
business of selling such vehicles or implements to ultimate purchasers,” and 29 U.S.C.
§213(b)(10)(B) exempts “any salesman primarily engaged in selling trailers, boats, or aircraft, if
he is employed by a non-manufacturing establishment primarily engaged in the business of
selling trailers, boats, or aircraft to ultimate purchasers”.
These exemptions allow dealerships to pay sales staff (who are typically paid commissions)
without additional overtime compensation. They also allow dealerships to avoid paying overtime
to mechanics and workers handling parts within their service departments.
The legislative history behind this statutory language confirms that the exemptions were intended
to apply only to salespersons, mechanics and partsmen. Brennan v. Deel Motors, Inc., 475 F. 2d
1095 at fns. 1 &2 (5 th Cir. 1973) (citing House and Senate Reports). The exemptions, enacted in
1966, replaced a previous statutory exemption that was much broader in scope. Id.
The statute clearly requires that any individual for whom the exemption is claimed must be
“primarily engaged in selling or servicing.” DOL’s longstanding regulation has recognized this
clear statutory requirement, since its promulgation in 1970. 29 C.F.R. §779.372 (c)(4) states:
Employees variously described as service manager, service writer, service
advisor, or service salesman who are not themselves primarily engaged in the
work of a salesman, partsman, or mechanic as described above are not exempt
under section 13(b)(10). This is true despite the fact that these employees’
principal function may be diagnosing the mechanical condition of vehicles
brought in for repair, writing up work orders for repairs authorized by the
customer, assigning the work to various employees and directing and checking on
the work of mechanics.
1) USDOL Proposal
The new regulation would expand the exemption beyond the statutory language by making
service writers exempt if they are selling the servicing of vehicles that the dealership sells.
Proposed 29 C.F.R. § 779.372(c)(4) would state:
Employees variously described as service manager, service writer, service
advisor, or service salesman, who are primarily engaged in obtaining orders for
servicing of automobiles, trucks, or farm implements that the establishment is
primarily engaged in selling, are exempt under section 13(b)(10)(A). Such
employees typically perform duties such as greeting customers and obtaining
information regarding their service or repair concerns; diagnosing the mechanical
condition of the automobile, truck, or farm implement brought in for repair;
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