Lindabury, McCormick, Estabrook & Cooper, P.C. Firm News & Events
Employment Law Newsletter
Although many domestic workers are covered by the Fair Labor Standard Act’s (FLSA) minimum wage and overtime requirements, there presently exists an exemption from these requirements for home health care workers providing “companionship services for individuals who are unable to care for themselves.” In 2007, the United States Supreme Court ruled that home healthcare providers employed by third-party agencies were entitled to this exemption, resulting in significant wage and overtime savings to these agencies.
On December 15, 2011, the U.S. Department of Labor (DOL) announced proposed regulations aimed at closing the exemption to caretakers employed by third-party agencies. The highlights of the proposed regulations include:
- Clarification that “companionship services” do not include medical care services typically provided by individuals with specialized training;
- Limitation of the kinds of activities that will be considered incidental to the provision of companionship services by excluding certain housekeeping tasks, such as window washing and vacuuming;
- Requiring employers to maintain hourly work records for live-in domestic employees;
- Clarifying that the companionship exemption is limited to companions employed by the household utilizing the services, not to third party employers, even in situations where the caregiver is employed jointly by the household and third party agency.
Should these regulations be adopted, home healthcare agencies will be obligated to pay home healthcare workers minimum wage and overtime compensation, resulting in significantly increased labor costs. Workers employed directly by family members will be unaffected by the regulations and will retain their exempt status.