DOJ and HHS Issue Release on New FLSA Home Health Care Worker Rule

HealthCareReformOn December 15, 2014, the U.S. Department of Justice (DOJ) and the U.S. Department of Health and Human Services (HHS) issued a joint letter setting out the agencies’ concerns about the upcoming implementation of the revised companionship and live-in domestic-service workers regulations under the Fair Labor Standards Act (FLSA).

As a reminder, third-party employers will no longer be able to classify companion workers or live-in domestic service workers under either exempt classification as of January 1, 2015. The definition of “companion” under the FLSA was also revised.

The agencies issued guidance because they are tasked with enforcing Title II of the ADA. Title II applies to state and local governments and mandates that “no qualified individual with a disability shall, by reason of such disability, be excluded from participation in or be denied the benefits of the services, programs, or activities of a public entity, or be subjected to discrimination by any such entity.”

In the release, the agencies raise the issue of whether the FLSA’s new companion and live-in domestic-service worker regulations will inadvertently result in discrimination against individuals with disabilities in violation of Title II. The agencies are concerned that third-party employers and government agencies who will have to pay companions and live-in domestic-service workers overtime in addition to minimum wage will either cut hours or limit travel time to avoid the cost of overtime. According to the agencies, these limitations could have the unintended consequence of discriminating against individuals with disabilities because state and local agencies must “make reasonable modifications in policies, practices, or procedures when the modifications are necessary to avoid discrimination on the basis of disability.” If an individual with disabilities needs care in excess of any work limitation set by a state agency or a joint-employer private entity, then the resulting lack of services may violate Title II.

While Title II applies to state and local governments, private agencies that contract with government agencies to provide services to individuals with disabilities could also be affected if they are joint employers with state or local government agencies. The requirements of Title II apply even when a government agency contracts with a private organization for services. Third-party employers could find themselves caught between controlling costs and complying with Title II.

Contact the governmental entity with which you have contracts for services to understand how it may be planning for the cost of increased wages and compliance with Title II.