On December 15th, The Department of Labor announced a new proposed rule that could dramatically change how seniors and those with disabilities access home care. The proposal would eliminate a long standing federal labor code exception that allows home care agencies and private families to avoid paying overtime and minimum wage to live-in caregivers. (In California and many other states, minimum wage is already mandated by state law and paid, but the overtime exemption still exists. Most reputable agencies in California already pay higher than minimum wage for hourly home care workers.)
The overtime exemption dates back to 1974 and it was intended for domestic employees who “provide companionship services for individuals who (because of age or infirmity) are unable to care for themselves…”
The idea was to allow a family or individual to hire a “caregiver” and set a wage for live-in, allowing the family to avoid excessive regulations regarding mandatory breaks, paperwork, etc. Over the last three decades, the exemption has also been used by third party employers, such as home care agencies, to put caregivers in the home for so called “live-in” shifts. The caregiver is typically paid for 16 hours of work per day and is given 8 hours of rest. The caregivers take meal breaks in the home and have access to restrooms, a phone, tv, and rest as needed. However, regular labor codes, such as providing a 15 minute break every five hours of work, are not applicable.
The Labor Department cited a large growth in the home care industry and a growing number of workers employed as caregivers as a reason to re-examine the live-in overtime exemption.
Under the rules proposed December 15th, home care agencies and registries would no longer be able to use the exemption for live-in workers. It’s not yet clear if that would mean live-in caregivers would have to be paid minimum wage the first 8 hours, time and a half the second four hours, then double time the next four hours. If that is true, the cost to seniors and their families would go up by roughly 50 percent per day. The result could be that families would turn to the underground economy for care and would perhaps hire unscrupulous individuals who are not vetted, trained, or supervised.
Under the proposed new rules, Individuals and families could still use the exemption if they hired privately, however, that use would be narrowed. For example, they could not hire a “professional” caregiver, or someone who provides care as a vocation. They’d be able to use the exemption only if they hired a family member, friend, or someone who doesn’t ordinarily earn income from caregiving.
The proposed rule clarifies that only incidental housework could be performed by the live-in caregiver. Tasks such as cleaning dishes or doing a load of laundry would be okay. Vacuuming would not be okay.
Other incidental tasks to be allowed would include bathing, dressing, grooming, toileting, driving to appointments, feeding, etc.
It’s also not clear what affect this would have on nannies or babysitters, but the proposal seems to eliminate the exemption to not pay babysitters and nannies overtime. So a family going out of town for the weekend would be required to pay a nanny overtime if she worked from 6pm on Friday to 8pm on Sunday evening. Other labor codes would also have to be followed.
The proposal will be open to public comment for 60 days after it is published in the Federal Register. Click this link to read more about the companionship exemption.
You can read more information about the proposed rules on the Labor Department website.
Post a comment about the proposed rule by clicking here.
At Home Care Solution is a leading provider of home care services including hourly, daily and live-in care. We offer no-cost, in-home assessments and provide fully screened and trained personal care aides.