Federal Appeals Court Reinstates New Federal Minimum Wage and Overtime Requirements for Home Health Care Workers Employed By Third-Party Employers
In the fall of 2013, the U.S. Department of Labor (DOL) put forth a final rule extending the Fair Labor Standards Act's (FLSA) minimum-wage and overtime requirements to most of the nation's workers who provide home care assistance to elderly people and those with illnesses, injuries or disabilities. Workers impacted by the rule included certified nursing assistants, home health aides, personal care aides, caregivers, and companions. The DOL also ruled that agencies and other third party employers could no longer claim the overtime pay exemption for live-in domestic service workers. Announced on Sept. 17, 2013, the rule was scheduled to go into effect January 1, 2015.
Several home health care associations challenged the DOL regulation arguing that the regulation was inconsistent with the actual language of the FLSA and congressional intent in creating the minimum wage and overtime exemptions. The trial judge in Home Care Association of America v. Weil agreed with the association challengers and invalidated the new regulation, concluding that the regulation contravenes the FLSA exemptions.
U.S. Appellate Court Decision
On August 21, 2015, the United States Court of Appeals for the D.C. Circuit in Home Care Association of America v. Weil–reinstated the DOL's regulations extending the federal minimum wage and overtime requirements for home health care workers employed by third-party employers. The federal appeals court decision overturned a lower court decision that struck down the new regulation just before it was scheduled to go into effect at the beginning of 2015.
In its opinion reversing the lower court, the appellate court ruled that the DOL's regulation was grounded in a reasonable interpretation of the federal FLSA. The appellate court relied substantially on a 2007 decision issued by the Supreme Court of the United States in determining that the DOL was vested under federal law with the necessary discretion to limit the scope of the minimum wage and overtime exemption that had previously applied to home health care workers.
The federal appeals court also struck down the home health care associations' challenge to the portion of the new regulation defining the scope of the “companionship services” encompassed by the companionship-services exemption under the FLSA. On this issue, the court ruled that the associations do not have standing to maintain the challenge in federal court. The appeals court concluded that since the third-party employers could no longer take advantage of the companionship services exemption, they no longer could claim they were injured by the narrowing of that exemption.
While the appeals court decision does not mean that the minimum wage and overtime requirements will go into effect immediately, it paves the way for the DOL regulation that extends the federal minimum wage and overtime requirements to home health care workers employed by third-party employers to go into effect in its entirety.
Some states already require third-party employers to pay overtime and minimum wage to home health care workers and personal attendants, but those state laws may include requirements that differ from the FLSA's overtime requirements. For example, California's Domestic Worker Bill of Rights—Assembly Bill 241–signed by the governor in 2013–requires that overtime compensation be paid to personal attendants for hours worked that exceed 9 hours per day or 45 hours per week. The FLSA, on the other hand, requires overtime payments for hours worked that exceed 8 hours per day or 40 hours per week. In these cases, employers must be careful to ensure that they are complying with both state and federal law.
If you have questions about California minimum wage or overtime pay laws, don't hesitate to contact leading California employment lawyers from Kingsley & Kingsley to take advantage of a free initial consultation. To discuss your situation call us toll-free at (888) 500-8469 or click here to contact us regarding your case.