Labor Department Cracks Down on Home Care Providers

Federal watchdogs continue to ramp up oversight of home care companies for minimum wage and overtime pay violations, a Wednesday report from Bloomberg Law suggests. Meanwhile, caregiver registries are creating uncertainty as to whether they should be considered employers.

Over the past few months, several home care companies across the U.S. have been met with lawsuits from the U.S. Department of Labor (DOL) Wage and Hour Division (WHD). Specifically, DOL is going after home care companies for misclassifying workers as independent contractors and not compensating them overtime payments, according to Bloomberg Law.

In Virginia, for example, DOL recently won $1.2 million from a lawsuit against Access Home Care. In their case, DOL officials claimed the home health services provider failed to pay its employees the appropriate overtime premium rate for hours worked in excess of 40 hours per week between April 2015 and April 2017.

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The Access Home Care lawsuit is far from a one-off, however.

The labor department has also filed lawsuits against at least three additional providers recently, holding their owners personally liable for unpaid wages.

“By taking an evidence-based approach, WHD consistently prioritizes compliance assistance and enforcement resources in areas where the agency is most likely to uncover violations,” a department spokesperson told Bloomberg Law. “WHD continues to use a multi-pronged approach to compliance through investigations in high-violation industries, engagement and education of private and public stakeholders, and the use of communications tools and compliance assistance.”

In part, the DOL’s legal challenges are backed by a regulation implemented in 2015 under the Obama administration that extended the wage and hour protections to home health workers under the Fair Labor Standards Act (FLSA).

Home care industry leaders are calling for more clarity surrounding the rule, which they believe may come with the recent confirmation of an administrator of the Wage and Hour Division.

Those leaders include Phil Bongiorno, executive director of the Washinton, D.C.-based Home Care Association of America (HCAOA), an association that represents home care interests on both state and federal levels.

“HCAOA believes the review of the companion care exemption has been delayed in part due to the long wait for an administrator in the DOL Wage and Hour Division,” Bongiorno told Home Health Care News. “We hope that with Administrator Cheryl Stanton now onboard, that a review of the regulations and interpretive guidance can take place.”

HCAOA is “pleased” that DOL continues to address misclassification of home care workers, Bongiorno said, as the issue jeopardizes the quality and safety of services offered to older adults and individuals with disabilities.

Another question that looms large is if state caregiver registries are considered employers and are, therefore, subject to the rule.

Caregiver registries have popped up in a number of states.

Generally, these registries allow agencies and consumers to verify that caregivers have passed the necessary background checks and training to work in a given market.

Currently, home care workers that are hired by third-party agencies are not protected under FLSA.

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