Legal Definitions - enterprise

Enterprise

The term enterprise has several meanings in law, often referring to an organized undertaking or entity, particularly in business or for specific legal purposes like anti-racketeering or labor law.

• 1. General Business or Organizational Venture:

  In its broadest sense, an enterprise is any organized effort, project, or venture, especially one undertaken for business or commercial purposes. It can also refer to an organization or initiative carried out by a governmental body.

  • Example 1: A group of software developers launches a new startup company to create a mobile application for local businesses. This startup, with its defined goals, structure, and commercial aim, constitutes a business enterprise.
  • Example 2: A non-profit organization establishes a community recycling program, setting up collection points and educational workshops. This organized effort to manage waste and educate the public is an enterprise, even though its primary goal isn't profit.
  • Example 3 (Governmental Enterprise): A municipal government creates a new department to manage and operate the city's public library system, including acquiring books, staffing branches, and hosting community events. This public service initiative is considered a governmental enterprise.

• 2. Under Federal Anti-Racketeering Law (RICO):

  Under the Racketeer Influenced and Corrupt Organizations Act (RICO), an enterprise is defined very broadly. It can be any individual, partnership, corporation, association, union, or other legal entity. Crucially, it can also be a group of individuals who are associated in fact, even if they don't have a formal legal structure. For RICO purposes, this enterprise must be ongoing and must exist as an entity separate from the specific illegal activities it might engage in.

  • Example 1: A seemingly legitimate waste management company is secretly controlled by organized crime figures who use its trucks and facilities to transport illegal goods and extort payments from competitors. The waste management company itself, as an ongoing business entity, would be considered the enterprise under RICO, distinct from the specific acts of extortion or illegal transport.
  • Example 2: A loosely connected group of individuals regularly meets to plan and execute a series of high-value burglaries across several states. Although they have no formal name or legal structure, their ongoing association, shared purpose, and division of labor could constitute an "association in fact" enterprise under RICO.
  • Example 3: A local union chapter, through its leadership, consistently uses its power to demand kickbacks from construction companies in exchange for labor peace. The union chapter itself, as an established and ongoing organization, could be identified as the enterprise in a RICO prosecution, separate from the individual acts of bribery or extortion.

• 3. Under the Fair Labor Standards Act (FLSA):

  For the purposes of the Fair Labor Standards Act (FLSA), which governs minimum wage, overtime pay, and other labor standards, an enterprise refers to one or more persons or organizations that have related activities, unified operation or common control, and a common business purpose. This definition is important because if an employee works for an enterprise that meets certain criteria (e.g., has a certain level of annual sales or is involved in interstate commerce), they are generally entitled to FLSA protections.

  • Example 1: A national chain of fast-food restaurants, even though each individual restaurant might be managed locally, operates under a common brand, shared operational procedures, and central corporate control. The entire chain, viewed as a unified business, would be considered an enterprise under the FLSA.
  • Example 2: A holding company owns several distinct manufacturing plants that produce different products. However, these plants share a central accounting department, a unified human resources policy, and common executive leadership. This collective operation, despite having separate physical locations, would likely be considered a single enterprise for FLSA purposes.
  • Example 3: A large university system includes a main campus, several satellite campuses, a medical center, and various research facilities. All these entities operate under the same board of trustees, share administrative services, and pursue the common educational mission of the university. This entire system constitutes an enterprise under the FLSA.