Unfair Payment Results in $1 Million Settlement for New York Home Care Workers

A New York-based home care agency must pay a $1 million settlement after a court found the company had underpaid its employees and not adhered to overtime rules.

The suit represents the first time a class action by New York home health employees has been recognized. This could pave the way for future classes, according to lawyers familiar with the case.

A court determined McMillian’s Home Care Agency neglected to follow New York’s state labor law, which requires home care workers be paid minimum wage and over time, according to Catherine Ruckelshaus, legal co-director of National Employment Law Project (NELP), who represented the care providers in the case.

The original complaint made by Josefina Toledo Montero stated that while she was paid in accordance with the New York state’s minimum wage standards, she and her co-workers were not paid overtime for weeks they were assigned to work more than 40, at times up to 60, hours per week.

Although the unfair payment claim reaches as far back as 2004, the lawsuit was not filed until 2010.

“From what we understand, it is very difficult for workers to come forward and complain because they don’t want to lose their jobs. So, they grin and bear the long hours and the low pay,” said Ruckelshaus.

While NELP reported in 2011 that New York and 14 other states have state laws that provide home care workers with minimum wage and overtime protections, the employees are not protected on a national level.

Home care workers are often referred to by Congress as “companions” for seniors. As “companions,” home care providers have been exempt from receiving minimum wage and overtime pay on a federal level despite Congress’ decision to allow other “domestic service” workers the same protections beginning in 1974. 

As a result of the settlement, providers who worked for McMillian’s between 2004 and 2011 will receive monetary benefits based on the number of hours for which they were inaccurately paid.

Ruckelshaus hopes this case will bring more attention to the laws that currently protect home care workers in states like New York.

“By bringing lawsuits and trying to get the word out, there will be a lot more public education about the rights and responsibilities in the home care industry,” said Ruckelshaus.

Written by Erin Hegarty


Erin Hegarty

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