U.S. to Include Home Care Aides in Wage and Overtime Law
By:Steven Greenhouse (NY Times) September 2013
The Obama administration announced on Tuesday that it was extending minimum wage and overtime protections to the nation’s nearly two million home care workers.
Advocates for low-wage workers have pushed for this change, asserting that home care workers, who care for elderly and disabled Americans, were wrongly classified into the same “companionship services” category as baby sitters — a group that is exempt from minimum wage and overtime coverage. Under the new rule, home care aides, unlike baby sitters, would be covered under the Fair Labor Standards Act, the nation’s main wage and hour law.
In an unusual move, the administration said the new regulation would not take effect until Jan. 1, 2015, even though regulations often take effect 60 days after being issued. The delay until 2015 is to give families that use these attendants, as well as state Medicaid programs, time to prepare.
Industry experts say most of these workers are already paid at least the minimum wage, but many do not receive a time-and-a-half overtime premium when they work more than 40 hours a week. About 20 states exclude home care workers from their wage and hour laws.
“We think the workers providing this critical work should be receiving the same basic protection and coverage as the vast majority of American workers,” said Laura Fortman, deputy administrator of the Labor Department’s Wage and Hour Division. “We’ve seen a lot of turnover in this industry, and we believe that this new rule will stabilize the work force.”
The nation’s home care workers usually earn $8.50 to $12 an hour, according to industry officials. The federal minimum wage is $7.25 an hour.
According to the Obama administration, almost 40 percent of aides receive government benefits like food stamps and Medicaid. Ninety-two percent of these workers are female, almost 30 percent are black and 12 percent are Hispanic.
Labor Secretary Thomas E. Perez said in a statement, “Today we are taking an important step toward guaranteeing that these professionals receive the wage protections they deserve while protecting the right of individuals to live at home.”
But industry officials said the changes would cause increases in Medicaid and Medicare spending, raise costs for families that use such services, and result in fewer jobs for home care workers.
Andrea L. Devoti, chairman of the National Association for Home Care and Hospice, said the new rule “will mean that people will receive less care.” She said the higher costs resulting from the new rule would lead many people to hire home care aides part time rather than full time. “Caregivers will in the end receive less pay,” she said.
The newly issued rule was also criticized by Representative John Kline, a Minnesota Republican who is chairman of the House Education and the Work Force Committee, and Representative Tim Walberg, a Michigan Republican who heads the panel’s subcommittee on work force protections.
They said it not only would raise costs, but would “limit access to in-home care for vulnerable Americans.” They added, “Faced with higher costs, some individuals will have no choice but to leave their homes and enter institutional living.” Long-term nursing home care, much of which is paid by Medicaid, is generally more expensive than home care.
Ms. Fortman of the administration’s wage and hour division said 15 states now provided overtime and minimum wage protection to home care aides. “We have not seen any evidence that it has resulted in job loss or any serious negative impact for the workers or for the people using the services,” she said.
The administration announced the change 21 months after first proposing the rule and after having received 26,000 public comments, many of them from for-profit home care agencies that opposed it. Many labor advocates criticized the administration for taking so long to issue its final rule, but Labor Department officials said reviewing the comments and holding related public meetings took time.
The federal government says six million of the 40 million Americans older than 65 need some form of daily assistance to live outside a nursing home. Federal officials estimate that the number will double to 12 million by 2030.
