HR Management & Compliance

Appeals court revives new homecare worker rules on minimum wage, overtime

A new rule from the U.S. Department of Labor (DOL) requiring minimum wage and overtime pay for many homecare workers is set to take effect after a ruling from the U.S. Court of Appeals for the District of Columbia Circuit.

The DOL instituted a rule in 2013 that removed the domestic service exemption for homecare workers hired by third-party agencies. Previously, workers providing companionship or live-in care for the elderly and disabled were exempt from the minimum wage and overtime requirements of the Fair Labor Standards Act (FLSA) even if they were employed by a third party.

A court challenge invalidated the new rules before the January 1, 2015, effective date. But on August 21, 2015, the appeals court upheld the DOL’s regulations, making approximately two million homecare workers eligible for minimum wage and overtime protections.

Effect on employers

Mark Wiletsky, an attorney with Holland & Hart LLP in Boulder, Colorado, posted an article on his firm’s website advising employers of homecare workers to immediately take steps to ensure they’re in compliance with the FLSA minimum wage requirement for all hours worked as well as paying an overtime premium for all hours worked over 40 per week.

He also said employers need to revise their policies, handbooks and manuals, timekeeping procedures, job advertisements, and recruiting materials to reflect the rule change.

DOL reaction

The DOL issued a tweet following the court ruling praising the decision that “confirms this rule is legally sound.” The DOL also said “the rule is the right thing to do—both for employees, whose demanding work merits these fundamental wage guarantees, and for recipients of services, who deserve a stable and professional workforce allowing them to remain in their homes and communities.”

The tweet also said the DOL “continues to stand ready to provide technical assistance to states and other entities as they implement the Final Rule.”

Join us September 10 for a 30-minute webinar to find out all you need to know about the DOL’s rule. Visit http://store.hrhero.com/new-overtime-rules-for-home-care-091015 to register or learn more.