Challenges and Best Practices for Home Care Employers Following the Elimination of the Companionship Exemption

On October 1, 2013, the Department of Labor's Wage and Hour Division (DOL) published a final rule in the Federal Register eliminating the Fair Labor Standard Act's (FLSA) minimum wage and overtime exemption for home care workers employed by home care agencies and other companies.  The new regulations also significantly narrow the exemption for home care workers employed directly by the individuals or families receiving home care services. 

The new regulations will affect home care employers, their employees, and their clients seeking assistance to care for an elderly parent or a disabled child in his or her own home. For home care employers in particular, compliance with the law will require them to invest significant time and resources evaluating their compensation plans, updating their payroll and timekeeping systems, adopting new or revising wage and hour policies, and training their employees.  Recognizing that such a sea change conversion of home care workers from exempt to non-exempt takes a great deal of time, the DOL set an effective date of January 1, 2015.  Nonetheless, given the many challenges employers will face preparing their organizations for the changes, it would be best to begin planning for the transition now.

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Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.