Home Care Final Rule Update

There has been much discussion over the past few months about the Wage and Hour Division of the Department of Labor’s Home Care Final Rule, which would greatly narrow the home health care and companionship services exemption under the Fair Labor Standards Act (FLSA). This rule, which was originally intended to go into effect at the beginning of 2015, would have made almost 2 million home care workers who were previously classified as exempt eligible for minimum wage and overtime under the FLSA.

In two separate orders – one in late December and one in mid-January – a federal judge struck down the two main provisions of the Final Rule (disallowance of third party use of the companionship exemption and a greatly narrowed definition of companionship services). Thus, the Final Rule did not go into effect as planned.

Last week, the Department of Labor appealed both of these rulings. The appeal has been granted an expedited schedule, so we may know more about whether this Rule will eventually be put into place as early as late spring or early summer.

Until the appeal is decided, the DOL’s Home Care Final Rule will not be implemented. If you have employees who fall under the home health care and companionship exemption of the FLSA you can, for the moment, act as though the Home Care Final Rule does not exist. For now, you just need to continue to ensure that any home health care or companionship service workers meet the current requirements of the FLSA exemption; you should also be sure that these workers meet any state wage and hour requirements before classifying them as exempt from minimum wage and overtime pay.

GTM will continue to closely monitor this issue and provide updates as necessary. For more information, contact our Household Employment Experts at (888) 432-7972.