Fair Labor Standards Act Implementation

As the January 1, 2015 deadline approaches for implementation of the final rule on “Application of the Fair Labor Standards Act to Domestic Service” (also referred to as the home care or companionship rule), the Department of Labor, Wage and Hour Division released additional resources related to shared living programs. For additional information on the Rule, visit the DOL’s dedicated web site for fact sheets, FAQs, and contact information as well as a series of webinars.

Department of Labor Announces Time-limited, Non-enforcement Policy Regarding the Home Care Final Rule

On October 1, 2013, the Wage and Hour Division of the U.S. Department of Labor (DOL) released “Application of the Fair Labor Standards Act to Domestic Service; Final Rule”, 78 FR 60454, (Final Rule)  which extended minimum wage and overtime protections to most home care workers. Under the rule, most home care workers will have the same protections provided to the majority of U.S. workers under the Fair Labor Standards Act (FLSA), including many direct support professionals (DSPs) who provide supports and services to individuals with intellectual and/or developmental disabilities (I/DD).

The rule goes into effect on January 1, 2015.  However, DOL has received requests for a deadline extension from state agencies, national and state associations, and advocacy organizations, citing the need for additional time to secure budgetary, programmatic, and operational adjustments.  In response to these requests, on October 8, 2014, DOL announced the adoption of a time-limited, non-enforcement policy which applies to all employers. In a blog post, DOL stated the following:

“After careful consideration, the department decided to adopt a time-limited non-enforcement policy. This approach will best serve the goals of rewarding hard work with a fair wage while not disrupting innovative direct care services. For six months, from January 1, 2015 to June 30, 2015, the department will not bring enforcement actions against any employer who fails to comply with a Fair Labor Standards Act obligation newly imposed by the rule. During the subsequent six months, from July 1, 2015 to December 31, 2015, the department will exercise its discretion in determining whether to bring enforcement actions, giving strong consideration to the extent to which states and other entities have made good faith efforts to bring their home care programs into FLSA compliance. Throughout 2015, we will continue to provide robust compliance and technical assistance”.

Despite the deadline extension, DOL officials have pointed out that while as of the effective date DOJ may not bring enforcement actions, employers may be subject to a private right of action by an employee who believes s/he has been harmed by the employers’ actions.

DOL is maintaining a website dedicated to the Final Rule containing information related to the Final Rule, a series of webinars, FAQs, and Fact Sheets to assist employers, employees, and consumers navigate requirements of the Final Rule.

DOL Announces Time-limited, Non-enforcement Policy Regarding the Home Care Final Rule

On October 1, 2013, the Wage and Hour Division of the U.S. Department of Labor (DOL) released “Application of the Fair Labor Standards Act to Domestic Service; Final Rule”, 78 FR 60454, (Final Rule)  which extended minimum wage and overtime protections to most home care workers. Under the rule, most home care workers will have the same protections provided to the majority of U.S. workers under the Fair Labor Standards Act (FLSA), including many direct support professionals (DSPs) who provide supports and services to individuals with intellectual and/or developmental disabilities (I/DD).

The rule goes into effect on January 1, 2015.  However, DOL has received requests for a deadline extension from state agencies, national and state associations, and advocacy organizations, citing the need for additional time to secure budgetary, programmatic, and operational adjustments.  In response to these requests, on October 8, 2014, DOL announced the adoption of a time-limited, non-enforcement policy which applies to all employers. In a blog post, DOL stated the following:

“After careful consideration, the department decided to adopt a time-limited non-enforcement policy. This approach will best serve the goals of rewarding hard work with a fair wage while not disrupting innovative direct care services. For six months, from January 1, 2015 to June 30, 2015, the department will not bring enforcement actions against any employer who fails to comply with a Fair Labor Standards Act obligation newly imposed by the rule. During the subsequent six months, from July 1, 2015 to December 31, 2015, the department will exercise its discretion in determining whether to bring enforcement actions, giving strong consideration to the extent to which states and other entities have made good faith efforts to bring their home care programs into FLSA compliance. Throughout 2015, we will continue to provide robust compliance and technical assistance”.

Despite the deadline extension, DOL officials have pointed out that while as of the effective date DOJ may not bring enforcement actions, employers may be subject to a private right of action by an employee who believes s/he has been harmed by the employers’ actions.

DOL is maintaining a website dedicated to the Final Rule containing information related to the Final Rule, a series of webinars, FAQs, and Fact Sheets to assist employers, employees, and consumers navigate requirements of the Final Rule.

Joint Employment in Consumer-Directed Programs

Last week, the Department of Labor (DOL) held a briefing to address joint employment in consumer-directed programs as outlined in the Federal Register in October 2013. Officials reviewed an Administrator’s Interpretation from last month that defines companionship services, clarifies the duties test, and limits the use of the companionship services exemption and the live-in domestic service employee overtime exemption to individuals or their representatives only. Most workers in consumer-directed programs will have a third-party joint employer and therefore must be paid in compliance with the Fair Labor Standards Act’s minimum wage and overtime requirements. However, the exemption may be applied in situations in which the consumer is the sole employer. Third party employers may no longer claim exemptions under this rule. The Centers for Medicare & Medicaid Services recently released guidance on state options for Medicaid reimbursement for overtime and travel costs that may result from the Final Rule. For more information, please visit www.homecare.gov for a fact sheet and other information related to minimum wage and overtime pay for direct care workers.

Department of Labor Offers Additional Interpretation on the Application of Employment Law on Consumer Directed Services

Last week the Department of Labor (DOL) provided additional interpretation on how the home care rules apply to consumer directed services funded by Medicaid. States and provider organizations had raised concerns about how the Fair Labor Standards Act (FLSA) requirements about who is an employer apply to these services. The interpretation will require each public or private agency that administers or participates in a consumer-directed, Medicaid-funded home care program to evaluate whether it is an employer under the FLSA. The interpretation provides several examples of how FLSA requirements apply to different situations. Guidance and additional information about the rule can be found on the DOL website.

Department of Labor Releases Guidance on Shared Living Arrangements and the Fair Labor Standards Act

The Department of Labor (DOL) has released Administrator’s Interpretation No. 2014-1 and Fact Sheet #79G: Application of the Fair Labor Standards Act to Shared Living Programs, including Adult Foster Care and Paid Roommate Situations.  These documents provide additional guidance on how DOL’s Final Rule, Application of the Fair Labor Standards Act to Domestic Service, might affect certain “shared living” arrangements.  Shared living arrangements are often funded by Medicaid or other public sources and involve arrangements in which a person receiving supports and services and a direct care professional providing the supports live together.  The new rule will take effect January 1, 2015.

President Directs Secretary of Labor to Update Overtime Regulations

Last week, President Obama issued a Memorandum, “Modernizing Overtime Regulations,” to Secretary of Labor Tom Perez, directing the Secretary to update and modernize overtime protections for workers under the Fair Labor Standards Act. Specifically, the President directs the Secretary to “propose revisions to modernize and streamline the existing overtime regulations. In doing so, you shall consider how the regulations could be revised to update existing protections consistent with the intent of the Act; address the changing nature of the workplace; and simplify the regulations to make them easier for both workers and businesses to understand and apply.”

DOL Announces New Webinar Dates on Final Rule, “Application of Fair Labor Standards to Domestic Service”

The Department of Labor (DOL) has announced new dates for its webinars on the new final rule on the “Application of Fair Labor Standards to Domestic Service.” The rule extends the Fair Labor Standards Act (FLSA) minimum wage and overtime protections to most direct support professionals by narrowing exemptions for companionship service and live-in domestic service. The final rule will take effect January 1, 2015. DOL has planned five webinars on the final rule, which were postponed due to the government shutdown. Visit the DOL website to view the webinar schedule and to register.

Department of Labor Issues Final Rule on “Application of Fair Labor Standards Act to Domestic Service”

The Department of Labor (DOL) has announced a final rule on the “Application of Fair Labor Standards to Domestic Service.” The rule extends the Fair Labor Standards Act (FLSA) minimum wage and overtime protections to most direct support professionals by narrowing exemptions for companionship service and live-in domestic service. Once published in the Federal Register, the final rule will take effect January 1, 2015. According to DOL, this one-year extension of the effective date is designed to take into account “the complexity of the federal and state systems that are a significant source of funding for home care work and the needs of the diverse parties affected by this Final Rule.” Learn more about the rule at DOL’s new, dedicated web portal. DOL will host five webinars on the rule during October, organized by geographic region.

Fair Wages for Workers with Disabilities Act Reintroduced

Rep. Gregg Harper (R-MS) introduced H.R. 3086, the Fair Wages for Workers with Disabilities Act of 2011. The bill seeks to immediately end issuance of new special wage certificates for workers with disabilities under Section 14(c) of the Fair Labor Standards Act, and to phase out existing certificates over a 3 year period. Similar legislation was introduced in the 112th Congress by Rep. Cliff Stearns (R-FL) and Rep. Timothy Bishop (D-NY), but did not advance. The bill was referred to the House Committee on Education and the Workforce, which has scheduled no action on the bill. There is no companion bill in the Senate.