DOL’s Campaign to Revise Exemptions Given a Check in Home Care Worker Case

Home health care employers have won two important victories recently.  These victories serve to block an October 2013 Final Rule from the Department of Labor.  Traditionally the Fair Labor Standards Act contains an exemption to overtime and minimum wage laws for “companionship services.”  The 2013 Rule sought to narrow the definition of companionship services.  It also sought to eliminate the exemption completely for third-party providers of home care services.

The DOL wanted to change the definition by limiting the provision of “care” and “instrumental activities of daily living” to less than twenty percent of an employee’s total work hours.  Care would be defined as assistance with the activities of daily living, including bathing, dressing and feeding.  The proffered idea is that remaining companionship services, such as participating and assisting in leisure activities, would have to comprise the bulk of the work.  The reality is that this would virtually eliminate the exemption as a working category.

Originally the new Rule was to go into effect on January 1, 2015.  However, trade associations representing third-party home care providers challenged the third-party provider restriction as well as the changes to the definition of companionship services in June of 2014.

D.C. Circuit Judge Richard J. Leon considered these objections in Home Care Association of America v. Weil.  On December 22, 2014, Judge Leon vacated the third-party provider restriction.  In doing so he also vacated a proposed restriction prohibiting third-party providers from taking utilizing an unrelated exemption for live-in domestic employees.  He disapproved of the regulation’s consideration of who employed the employee by singling-out third-party employers, finding it inconsistent with the exemption’s “any employee” language.

Moreover, Leon characterized the DOL’s Rules as overreach, improperly using regulation to work around an inability to achieve goals with legislation.  Because the FLSA exemptions are creatures of legislation Leon took issue with the fact that the DOL acted after Congress repeatedly declined to alter the exemption.  He described the attempted circumvention as an effort to “rewrite the exemption out of the law.”

On December 24, 2014, Leon went further, saying the effective date of the new definition of companionship services until hearing could be ha on the matter.  The parties were heard and on January 14, 2015, Judge Leon vacated the proposed definition.  He described the decision as deference to the will of Congress, who has chosen not to remove or revise this exemption for these many years despite having ample opportunity to do so.

It has long been expected that the Obama administration plans to assault the FLSA’s white-collar exemptions, which affect many more employees than the companionship services exemption.  This may give them pause to consider that the Courts may yet show reluctance to allow administrative rewriting of laws without consideration for the will of Congress, who passed the laws to begin with and chose not to alter them.  How much pause may depend on the outcome of any further appeal to this decision.

The St. Louis employment attorneys at McMahon Berger have been representing employers across the country in labor and employment matters, including wage and hour issues, for almost sixty years, and are available to discuss these issues and others.  As always, the foregoing is for informational purposes only and does not constitute legal advice regarding any particular situation as every situation must be evaluated on its own facts. The choice of a lawyer is an important decision and should not be based solely on advertisements.