The home healthcare industry has become big business in South Florida, as our population ages. People want to stay in their homes – and out of assisted living facilities – longer, and thus more and more healthcare is home-based.
Home health workers have always been exempt from the overtime and minimum wage provisions of the Fair Labor Standards Act (“FLSA”). But, yesterday the U.S. Department of Labor (“DOL”) announced a rule that will change that. Labor unions supported this DOL action, while many in the healthcare business community opposed because of the added costs associated with the change.
Here’s the background information. The FLSA requires the payment of overtime and minimum wages to non-exempt employees who work in interstate commerce. In 1974, Congress amended the FLSA to include coverage for “domestic service” workers such as maids. But, that amendment specifically excluded employees who provide “companionship services for individuals who (because of age or infirmity) are unable to care for themselves.” This language makes babysitters exempt from the FLSA and has, in recent years, been interpreted to make home health aides also exempt. That has been true for home health workers employed directly by the individuals or families they work for, as well as third-party home health providers.
But, now the DOL has announced that, effective January 1, 2015, “direct care workers who perform medically-related services for which training is typically a prerequisite are not companionship workers and therefore are entitled to the minimum wage and overtime.” This new rule will not affect the FLSA status of aides who work directly for individuals/families. Those workers will remain exempt. But, those home health aides who work for third party agencies will now be entitled to the federal minimum wage, plus overtime.