Fair Wage and Labor Standards for In-Home Direct Care Workers

Rachel B. Morgan RN, BSN 6/28/2016

Fair Wage and Labor Standards for In-Home Direct Care Workers, U.S. Supreme Court Denies Request for Review 

In Oct. of 2015 a Department of Labor (DOL) final rule extending the application of minimum wage and overtime regulations under the Fair Labor Standard Act (FLSA) to direct care workers providing services in the home setting (e.g. home health aides, personal care aides, and certified nurse aides) went into effect after a contentious legal battle in federal court. Ultimately Chief Justice of the United States John G. Roberts had denied an application to stay a decision by the U.S. Court of Appeals for the District of Columbia Circuit upholding the rule, but left open the possibility that the U.S. Supreme Court could consider an appeal of the District Court’s decision at a later date.

On June 27, 2016, the U.S. Supreme Court issued an order denying a request to review the Court of Appeals decision leaving the final rule in place. DOL Secretary Thomas E. Perez issued a statement in response that “the Home Care Final Rule is legally sound, and it was the right thing to do.”

Congress explicitly extended FLSA coverage to “domestic service” workers in 1974, amending the Act to apply to employees performing household services in a private home, including those domestic service workers employed directly by households or by companies too small to be covered as enterprises under the Act. While Congress expanded protections to “domestic service” workers, the 1974 amendments exempted certain domestic service workers from the FLSA’s minimum wage and overtime provisions. Under this exemption, casual babysitters and domestic service workers employed to provide “companionship services” (such as companions for elderly persons or persons with an illness, injury, or disability) were not required to be paid the minimum wage or overtime pay. Congress also created an exemption only from the overtime pay requirement for live-in domestic service workers.

Hands helping elder person.

The Department’s updated rule:

  • Provides for minimum wage and overtime protection; to the many domestic service workers.
  • Defines the tasks that comprise “companionship services.”
  • Limits the exemptions for “companionship services” and “live-in domestic service employees” to the individual, family, or household using the services.
  • Revises the recordkeeping requirements for the employers of live-in domestic services employees.

 

Medicaid is the largest payer of long-term services and supports (LTSS), which includes the full range of home and community-based services (HCBS), such as personal care, Section 1915(c) waiver services, and rehabilitative services, as well as institutional services such as nursing homes, intermediate care facilities for individuals with intellectual disabilities (ICF/IID) and mental health facilities. States will need to consider the ultimate fiscal impact that increasing wages and covering overtime compensation for direct-care workers will have on state budgets, and access to care for the elderly and disabled. 

Resources

DOL created a web portal with interactive web tools, fact sheets and other materials to help families, other employers and workers understand the new requirements and has held several informational webinars. DOL will continue extensive outreach and technical assistance efforts, in particular with States regarding publicly funded home care programs.

Domestic Service Final Rule Frequently Asked Questions (FAQs)

New! Guide for Consumers and their Families

 


NCSL State Federal Relations staff contacts: Joy Johnson Wilson, Federal Affairs Counsel, Health and Human Services Policy Director  or Rachel B. Morgan RN, BSN, Senior Director, Health Human Services Committee.