Court Vacates FLSA Coverage for Home-Care Workers

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The revised definition of companionship services under a Labor Department final rule (RIN 1235-AA05) was vacated in an opinion and order by the U.S. District Court for the District of Columbia.

The term companionship services is ambiguous, and while Congress explicitly delegated to the Labor Department the authority to define the term, “that does not grant it a blank check to do so in a way that contradicts the Act itself,” the court said.

“Although Congress has not defined the outer bounds of companionship services, it has spoken on the precise issue presented here, which is whether that definition must include, in a meaningful way, the provision of care. The answer is yes. There are ambiguities in the statute, but this is not one of them,” the opinion said, noting that “Congress is the appropriate forum in which to debate and weigh the competing financial interests in this very complex issue,” not agency regulations.

The Labor Department said it strongly disagrees with both orders and is considering its legal options, according to information posted on the Labor Department's home-care website.

The final rule was to take effect Jan. 1 but was stayed until Jan. 15 to allow the court to consider the association's challenge to the rule's revised companionship-services definition following the court's Dec. 22, 2014, ruling that vacated another element of the final rule that would have excluded third-party employers, such as home-care agencies, from an exemption from the Fair Labor Standards Act's minimum wage and overtime pay requirements.

For more information, see Compensation and Benefit Library's “FLSA: Determining Coverage” chapter.

To contact the reporter on this story: Christine Pulfrey in Washington at mailto:cpulfrey@bna.com

To contact the editor on this story: Michael Baer at mailto:mbaer@bna.com