Court of Appeal Approves of New FLSA Regulations for Certain Homecare Workers

Under the Fair Labor Standards Act (FLSA), workers are entitled to a minimum wage and overtime pay.  However, in 1974, Congress amended the FLSA, and excluded workers providing “companionship services” as well as “live-in domestic-service-workers” from the Act’s minimum wage and overtime protections.  Since 1975, the Department of Labor has interpreted the amendment to exclude home care workers from minimum wage and overtime protection, even when those homecare workers are employed by third-party agencies.

In 2013, the Department of Labor changed course.  The Department amended its regulations so that homecare workers employed by third-party agencies would be eligible for overtime, and that the agencies would have to pay those workers no less than the federal minimum wage.  The new regulations were set to go into effect in January, but a group of home care agencies sued, asserting that the Department of Labor did not have the authority to change the exemption.

In a victory for homecare workers, last week the U.S. Court of Appeal in Washington, D.C., ruled that the Department of Labor had the authority to amend the regulations to extend FLSA overtime and minimum wage protections to homecare workers who are employed by third-party agencies.  The decision also applies to home care workers’ whose employment is funded by the state or federal government.  You can read the decision here.

The decision means that a California law granting overtime pay to In-Home Supportive Services (IHSS) workers could go into effect very soon.  The law was set to go into effect in January, but has been on hold pending the outcome of the litigation over the Department of Labor’s FLSA regulations.  However, California may wait to see if the decision is appealed the U.S. Supreme Court.  We will update this story as events warrant.

By Jake White | September 24, 2015

Legal Developments