Wage and Hour Reminder
Posted by: John Gilliland
July 07, 2008

I am sorry I have not been keeping the blog current. It's been a busy time. Hopefully, I will be able to begin regular postings in the next few weeks.

In the meantime, I just wanted to quickly remind you that the federal minimum wage increases to $6.55 per hour on July 24, 2008.

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Don't Forget Daylight Savings Time
Posted by: John Gilliland
March 06, 2008

At 2:00 a.m. this Sunday (i.e., the second Sunday in March) daylight savings time arrives and clocks should be set ahead one hour. 

Remember, if you have caregivers working a night shift or live-in, the change to daylight savings time can affect the number of hours they work.  For example, an employee who normally works an 8-hour shift that includes when the time changes, will actually only work 7 hours.  You can either pay for only the 7 hours actually worked or pay for the full 8 hours.  If you pay a full 8 hours, you do not need to include the extra hour's pay in determining a nonexempt employee's regular rate for overtime pay purposes. 

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Questions About the Coke Decision
Posted by: John Gilliland
July 11, 2007

previously posted June 19, 2007 

Last week was rather hectic.

The United States Supreme Court finally held that third party employers, such as home care agencies, can use the companionship services exemption to exempt certain of their employees from minimum wage and overtime pay under the federal Fair Labor Standards Act ("FLSA"). Coke v. Long Island Care at Home. The FLSA is the federal minimum wage and overtime pay law. A copy of the decision is attached to my last posting here on June 11, 2007.

The Coke decision generated many calls to our office from agencies and home care publications asking exactly what the decision means for agencies. There appears to be quite a bit of misunderstanding.

Let me try to clarify things.

What does the Supreme Court's Coke decision mean for a home care agency? It means a home care agency clearly can use the companionship services exemption to exempt certain of its employees from minimum wage and overtime pay under the FLSA. Coke had argued that her home care employer could not use that exemption to keep from paying her minimum wage and overtime pay.

So, my agency's employees are now exempt from minimum wage and overtime pay? No. All the Supreme Court held is that you can use the companionship services exemption. It did not hold that any of your employees fall within that exemption. For an employee to fall within that exemption, you still must prove the employee meets all the requirements for that exemption.

What are those requirements? Very, very briefly, there are four requirements to fall within the companionship services exemption: (1) the employee must provide companionship services; (2) not more than 20% of the employee's time in a workweek may be spent performing general household work; (3) the employee's duties may not require the training of an RN or LPN; and, (4) the services must be provided in the client/patient's private home. There is much more to it, but that is the essence of the requirements.

But, I've seen news reports saying the Court held that "home care workers" are not entitled to minimum wage and overtime pay. Doesn't that mean all my employees? No. It does not mean all of your agency's employee's are exempt from minimum wage and overtime pay. The decision applies only to employees who fall within the companionship services exemption.

Newspapers and TV reports have often reported the Coke decision as holding that "home care workers" are not entitled to minimum wage and overtime pay, but it is wrong and sloppy language. It probably is because they do not understand wage and hour law and, besides, are simply trying to just give a quick news report.

Does the Supreme Court's decision mean I don't have to worry about state law anymore? No. The Coke decision applies only to the federal FLSA. It does not change your state law at all. Even though an employee may fall within the federal companionship services exemption, he or she may still be entitled to minimum wage and/or overtime pay under your state law. An employee is always entitled to whatever is most beneficial to the employee - federal law or state law.

Is it now settled that home care agencies can use the companionship services exemption or can that change? It is settled in the courts. The Supreme Court's decision was unanimous and applies throughout the United States.

But, the Supreme Court based its decision on the FLSA and the interpretation given by the enforcement agency, the Wage and Hour Division of the United States Department of Labor. It was not based on the United States Constitution. Consequently, Congress could change the law to say third party employers, such as home care agencies, cannot use the companionship services exemption. It also is possible the Wage and Hour Division could change its interpretation.

How likely is that to happen? It's probably not likely with a Republican administration and Republican control of the House. If, however, there is a Democratic Administration or Congress, a change could occur through efforts of organized labor. Service Employees International Union ("SEIU") funded Coke's lawsuit and can be expected to look for other ways to end the companionship services exemption in home care.

What about my state law? Is it apt to change? I don't know, of course. But, if you are in a state that does not require minimum wage and overtime pay for employees who fall within the companionship services exemption, you should keep a close eye on efforts to change that in your state legislature. SEIU is active in attempting to require at least minimum wage for such employees under state law.

Where can I get the law/regulations concerning the companionship services exemption? The law and regulations are available at the Wage and Hour Division's website:

http://www.dol.gov/esa/whd/

Unfortunately, however, they will not be very helpful to you because much of what is required for the companionship services exemption arises through opinion letters and court decisions. The best resource for discussion of the exemption that I know of is in the Wage and Hour in Home Care manual I wrote. It can be purchased through our firm. Go to:

http://www.gilliland.com/CM/Custom/TOCPublications.asp

Okay, I admit that is a shameless plug, but I honestly do not know of as complete a discussion of the exemption anywhere else.

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Bottomline, the Coke decision is a very import decision for home care agencies, but it only permits agencies to use the companionship services exemption. It does not automatically exempt anyone from minimum wage and overtime pay. Plus, even if an employee falls within that federal exemption, you still must check to see if the employee is entitled to minimum wage and/or overtime pay under state law.

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Supreme Court Rules for Home Care in Coke Case
Posted by: John Gilliland
July 11, 2007

previously posted June 11, 2007 

This morning, the United States Supreme Court ruled that third party employers, such as home care agencies, can use the companionship services exemption to exempt certain employees from minimum wage and overtime pay under federal law. Coke v. Long Island Care at Home, Ltd.

A copy of the decision is attached.

I will write more about this decision in the next week.

Attachments:
SupCtCoke.pdf

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Coke v. Long Island Case
Posted by: John Gilliland
July 11, 2007

previously posted April 17, 2007 

Yesterday, the U.S. Supreme Court heard oral arguments in Coke v. Long Island Care at Home. That is the case which will determine whether or not home care agencies can use the federal companionship services exemption from minimum wage and overtime pay.

The companionship services exemption is a complete exemption from minimum wage and overtime pay for employees who fall within it. It is a very important exemption for many home care agencies because it can apply to home health aides, cna's, companions, sitters, live-ins and similar employees. (Note, however, that, even though an employee is exempt from minimum wage and overtime pay under the federal law, he or she may still be entitled to either or both under a state wage and hour law.)

If you want to know more about the companionship services exemption, there is an article about it that I wrote on the website of the National Private Duty Association. Go to:

http://www.privatedutyhomecare.org

The link to the article is at the lower, right of NPDA's home page. It is dated in terms of the Supreme Court but it will give you an overview of the exemption, itself.

Maria Tsigas, Editor of Private Duty Insider ("PDI"), attended the oral argument before the Supreme Court on Monday. Information concerning PDI is at:

http://store.homehealthinteractive.com/store/productdetails.aspx?pid=PD

Yesterday, Maria sent a brief e-mail to PDI subscribers concerning what was said during the argument before the court. She quoted Justice Stephen Breyer as observing that, if the exemption applied only to those hired "by the household" (as opposed to home care agencies), then "... the millions of people who need care, won't be able to get it."

His comment reminded me of something I have felt for some years as exemptions from minimum wage and overtime pay for caregivers are discussed. We are not debating the real issue. We debate the meaning and wording of the federal wage and hour law, the "Fair Labor Standards Act," and its regulations. Of course, that is much of the issue legally. However, we do not discuss the underlying public policy issue which must be resolved as our population ages.

To me, the policy issue we must address is who is society going to prefer - the employee or the patient/client? The companionship services exemption is in the middle of two, important public policies. First, is the desire to assure many workers at least a minimum wage and overtime pay. Second, is the desire to have affordable care for the aged and infirm.

Which public policy is to take precedence? If caregivers must be paid minimum wage and overtime pay, it can make their services unaffordable to many patients/clients. On the other hand, to have affordable care, it can mean not having to pay minimum wage and overtime pay. Or, is there a way to accomplish both?

Of course, there is more to it than that simple one or the other characterization. But, it is the issue that needs to be discussed seriously. I know of no one who is doing so.

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Don't Forget the Federal Minimum Wage Increase
Posted by: John Gilliland
July 05, 2007

Don't forget that the federal minimum wage increases on July 24, 2007. The Fair Minimum Wage Act of 2007 establishes the following increases:

* Beginning July 24, 2007 - $5.85 per hour

* Beginning July 24, 2008 - $6.55 per hour

* Beginning July 24, 2009 - $7.25 per hour

Also, remember that a poster must be displayed to advise employees of their rights under the federal Fair Labor Standards Act ("FLSA"). It must be posted in all locations where employees subject to the FLSA are employed. A new version of that poster which reflects the new minimum wage rates can be downloaded from the Wage and Hour Divsion's website at:

http://www.dol.gov/esa/whd

As always, pay attention to any applicable state minimum wage law. A covered employee is entitled to whichever is higher - federal minimum wage or state minimum wage.

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