Judge strikes down second half of home care rule

A federal district judge struck down the second part of a Department of Labor (DOL) regulation meant to expand minimum wage and overtime pay to home healthcare workers. 

The decision Wednesday comes one day before U.S. District Court of D.C. Judge Richard Leon’s temporary stay of the rule was due to expire, stopping the DOL from requiring employers of home care workers, including third-party employers, to consider whether employees are caring for their clients. 

The rule would have redefined the definition of companionship services. 

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Employers now are exempt under the Fair Labor Standards Act from having to pay overtime if a domestic service employee is hired to provide companionship services to elderly and disabled individuals unable to care for themselves.

“There is, to be sure, ambiguity in the meaning of the term ‘companionship services,’ and Congress has explicitly delegated authority to the department to define the term,” Leon wrote in his decision. “ But that does not grant it a blank check to do so in a way that contradicts the [Fair Labor Standards] Act itself.”

Last month, Leon struck down the first part of the DOL rule that would have extended overtime and minimum wage to home health companion workers employed by third-party businesses. 

The International Franchise Association (IFA), Home Care Associates of America and the National Association for Home Care & Hospice sued the Department of Labor for not only changing the 40-year-old exemption but redefining care.

In a release, Thursday, IFA Executive Vice President of Government Relations & Public Policy Robert Cresanti said the judge’s ruling further demonstrates the court's willingness to stop executive overreach that hurts business. 

“We appreciate the court’s ruling to hold the administration accountable for misdirected policies pursued in defiance of congressional intent and legal precedent,” he said.

But not everyone is hailing the judge’s decision.

Caring Across Generations, a long-term-care advocacy group, said the ruling means home care workers around the country will have to wait even longer for basic labor protections that could lift them out of poverty. 

“With median hourly wages of just $9.61, home care workers are among the lowest-paid workers in the country, placing them and their families in poverty even while they work long hours to support others,” said Sarita Gupta, co-director of the nonprofit. “We need to ensure that these workers are afforded the same basic protections that most Americans take for granted if we stand a chance at sustaining this workforce.”