Individual coverage — whether a given employee is personally “engaged in commerce or in the production of goods for commerce” (trade, transportation, transmission, or communication across state lines, or producing goods intended to move that way) — is not the only door into the protections of the Fair Labor Standards Act. Under the 1961 and 1966 amendments, an employee is also covered on an “enterprise” basis if they are “employed in an enterprise engaged in commerce or in the production of goods for commerce” as defined in Sections 3(r) and 3(s) of the Act. Critically, this holds “whether or not” that employee is individually covered on the traditional basis — enterprise coverage is a separate test, not a fallback that only matters when the individual test fails.

Section 3(r) defines an “enterprise” broadly: “the related activities performed (either through unified operation or common control) by any person or persons for a common business purpose” — in plain terms, activities run as a single operation, or owned or directed by the same person or persons, even if not merged into one operation — covering all such activities whether they happen in one establishment or many, and whether they sit under one corporate unit or several. If that enterprise then meets the “engaged in commerce” description in Section 3(s), every employee working in it is subject to the Act to the same extent as someone individually engaged in commerce — unless specifically exempt.

This chapter covers Section 3(s) only as applied by the Wage and Hour Division — the federal agency responsible for enforcing the Act’s wage-and-hour provisions — to the construction industry. Under § 776.22a, that is an enterprise “which has employees engaged in commerce or in the production of goods for commerce, including employees handling, selling, or otherwise working on goods that have been moved in or produced for commerce by any person,” that is “engaged in the business of construction or reconstruction, or both.” In plain terms, a construction or reconstruction enterprise clears this bar as long as it has some employees who are engaged in commerce, engaged in producing goods for commerce, or who handle, sell, or otherwise work on goods that have already moved in or been produced for commerce — the enterprise itself just has to be in the construction or reconstruction business. The general thresholds that decide which enterprises clear the 3(s) bar in other industries, along with the dollar-volume figures attached to them, aren’t in this chapter’s source material. What this section establishes is narrower and more durable: the enterprise route exists, runs on its own logic, and doesn’t depend on any one employee’s individual duties.