The Department of Labor’s (DOL) Final Rule providing many home care workers protections under the Fair Labor Standards Act (FLSA) including the right to minimum wage and overtime is moving forward for implementation. While the rule was to become effective January 1, 2015, an association of providers of home care services challenged the rule in court in 2014. The Rule was not implemented during a lower court duel. After the U.S. Court of Appeals for the District of Columbia upheld the rule in favor of the DOL, the association of home care workers sought a stay with the U.S. Supreme Court. Last month the request for a stay was denied without opinion. It remains to be seen whether the Supreme Court will hear the underlying case. In the meantime, the DOL will move forward with a phased implementation over the remainder of the year.
The main issue that the courts addressed regarding the final rule was whether the FLSA’s exemption from minimum wage and overtime protections applied to persons hired directly by the home care recipients and their families or whether the exemption also extended to employees of third party agencies. The district court ruled that the DOL lacked “authority to issue a regulation that transforms defining statutory terms into drawing policy lines based on who cuts a check.” The Court of Appeals for the D.C. Circuit disagreed with the district court and upheld the DOL’s final rule on August 21, 2015.
The challengers to the DOL rule asked the United States Supreme Court to stay the appeals court ruling until the Supreme Court could review a formal appeal. On October 6, 2015, the Supreme Court refused to do so, essentially allowing the final rule to take effect on October 13.
Although the Supreme Court could review the case and rule against the DOL, employers of home care workers who have not yet taken steps to address minimum and overtime wage issues should evaluate their compensation policies immediately.
Home Care Pulse, a home care marketing company, is researching how the new rule will impact the operational function of home care businesses, care providers, and the industry. Please consider participating in the Home Care Pulse Survey on this issue:
The Court of Appeals decision can be read at: