What Home Health Agencies Can Learn from Wage Rules in Illinois

Litigation surrounding hourly pay and overtime is a hot-button topic that is becoming more and more prevalent in the in-home care sector. With changing laws and strong efforts from the direct care workforce to increase wages, home health care providers around the country can look to Illinois as an example of these challenging dynamics.

In fact, earlier this year, a group of home health aides in Illinois banded together seeking class-action status in a case against Centegra Health System revolving around time-and-a-half pay for overtime.

Such cases should alarm home health agencies and push providers to take a closer look at how they keep track of employee scheduling, according to William Tarnow, partner and chair of the labor and employment practice group at Chicago-based law firm Neal, Gerber & Eisenberg, LLP.


“Wage and hour issues is something that is slowly but surely creeping into [the home health] industry as a threat that we’ve seen time and again in other industries,” Tarnow recently said in a panel at the 2017 Private Duty Symposium hosted by the Illinois Homecare & Hospice Council, LeadingAge Illinois and Home Care Association of America.

Current hourly wage rates

Tarnow and colleague Jason Kim, partner at Neal, Gerber & Eisenberg pointed to the situation in Illinois as an example of why home health care providers need to keep an eye on minimum wage levels—and how the impact of changing laws can impact hourly employees.


Current Federal minimum wage rates stand at $7.25 per hour, though many states and individual cities have much higher minimum wages. In Illinois, the state minimum wage is currently $8.25 per hour; on a micro scale, the City of Chicago has employed an $11.00 hourly rate, while Cook County is $10.00 per hour. And wages are scheduled to continue rising annually.

Because of these varying minimum wage rates, Tarnow stressed the importance of sharp record keeping for all hourly wage caregivers, particularly those working across more than one municipality.

“[Varying minimum wage rates] can pose significant headaches for those of you who might have operations that are in different locations and you’re trying to track an individual based on where he or she works,” said Tarnow. “This can be a very difficult process, particularly for those who [operate] in and out of Chicago and Cook County, and including the fact that individual municipalities have opted out of [these wage rates].”

‘Round the clock care

Under the Fair Labor Standards Act (FLSA), overtime for all hours worked in excess of 40 hours in a workweek requires time-and-a-half pay. However, calculating overtime pay can be cumbersome, particularly for agencies that employ caregivers who provide 24-hour care within the home.

“The problem you have with live-in caregivers is … when you think about [a caregiver] who is in the house 24 hours, how much of that time do you have to pay?” Kim said during the panel.

Both Tarnow and Kim stressed, though, that an employee who resides and provides care within a client’s home permanently or for an extended period of time does not need to be paid for all their time spent within the residence.

According to a Department of Labor (DOL) rule, employers and employees may agree to deduct no more than eight hours devoted regularly scheduled sleeping periods. Further, when a live-in caregiver engages in “other periods of complete freedom from all duties,” he or she does not have to be paid for that time.

For this reason, many agencies have adopted and implemented a “13-hour rule,” where they pay live-in caregivers for 13 hours of work per 24-shift, automatically deducting eight hours for sleep and three hours for meal times, Kim said.

Despite the Illinois Department of Labor (IDOL) “acquiescing” to this model, according to Kim, the 13-hour model can get muddled, as meal periods, sleep time or other periods of free time that are interrupted by a “call to duty,” must be counted as time worked.

Indeed, a New York judge recently ruled that live-in caregivers should be paid for all 24-hour shifts they are working in a home.

Kim also pointed to another Illinois law, called “One Day Rest in Seven Act” (ODRISA), that agencies should be mindful of, which guarantees time off for all employees.

“[ODRISA] requires employers to give [a minimum] one day off [in a work week], so technically you can’t have an employee working seven days, unless you file for an exemption with IDOL,” he said.

In addition, Illinois Governor Bruce Rauner has been attempting to crack down on overtime for caregivers in the state-financed home care program.

Kim warned that if an expressed or implied agreement regarding how an employee will be paid for sleep or meals is not established, all hours on duty must be paid.

For this reason, it’s crucial agencies establish a policy and an agreement with their employees in writing with an allowance for clearly defined sleep and meal periods, as well as an acknowledgement that any interruption in these break periods to address client needs will be considered compensable time, he said. Solid record-keeping on these agreements is key.

Employers may require live-in caregivers to record their exact hours worked and submit them. For caregivers working on fixed schedules, an employer may maintain records showing the schedule of daily and weekly hours they normally work, according to Kim and Tarnow’s presentation on the issue.

“Keep records readily accessible … and reach new agreements if there is a deviation from the original agreement,” said Kim.

Paid sick leave

Another sticky area for providers to watch out for is the recently implemented Chicago and Cook County Paid Sick Leave Ordinances, which came into effect in July.

In broad strokes, the ordinances require employers to provide up to five days (or 40 hours) of paid sick leave per year to employees working in the City of Chicago and Cook County. The ordinance applies to employees who work at least two hours in any two-week period for employers within the geographic boundaries of Chicago and Cook County.

Employees accrue paid sick leave at the rate of one hour per every 40 hours worked; full-time exempt employees who work less than/equal to 40 hours/week accrue leave based on a 40-hour work week, while part-time exempt employees who work more than 40 hours per week accrue leave based on actual hours worked.

As the national discussion around minimum wage and benefits for home care workers intensifies, the changing laws and subsequent litigation issues in Illinois are reasons enough for any provider with hourly employees to pay attention.

Written by Carlo Calma

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