New Labor Regulations Expand Minimum Wage and Overtime Coverage for Home Care Workers

By:Rachel D. Gebaide and Melody B. Lynch

Earlier this week, the U.S. Department of Labor (“DOL”) issued final regulations significantly narrowing the “companionship services” exemption under the Fair Labor Standards Act (“FLSA”).  Effective January 1, 2015, this change expands minimum wage and overtime coverage to an estimated two million workers employed by home care agencies or other third parties.  Home care workers hired directly by the families that employ them will continue to be exempt from the minimum wage and overtime requirements of the FLSA provided that these workers primarily provide companionship services under the new definition. The changing landscape of home health care prompted the DOL to enact these new regulations as the country’s aging population increasingly elect to seek long-term care at home rather than in an assisted living or skilled nursing facility.

When Congress enacted the FLSA in 1938, the law did not cover workers employed in domestic service jobs in households.  In 1974, Congress extended FLSA coverage to domestic workers, such as housekeepers and gardeners, but exempted from minimum wage and overtime pay for  those domestic workers who provide companionship services to the aged and infirm. Effective January 1, 2015, companionship services will mean the provision of fellowship and protection to the elderly, or persons with illnesses, injuries or disabilities. Companionship services may include conversation, reading, games, crafts and accompanying the person on walks, errands or to appointments. Significantly,  companionship services will no longer encompass assistance with activities of daily living (“ADL”) (e.g., dressing, grooming, feeding, and bathing) or activities instrumental to activities of daily living (“IADL”) (e.g., meal preparation, driving, light housework, and arranging medical care).  A domestic worker providing companionship services may provide ADL and IADL so long as…to read this article in full, click here.