Home-Care Industry Wants Wage Rule Reversed by Trump Labor Chief

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By Ben Penn

Industry advocates will urge the next labor secretary to reverse an Obama-era rule that extended minimum wage and overtime coverage to some 2 million home-care employees, a trade group’s top attorney told Bloomberg BNA.

“We will be seeking the reinstatement of the original rules on the companionship services and live-in domestic services exemptions once the new Secretary is confirmed,” William Dombi, vice president for law at the National Association for Home Care and Hospice, said in an April 11 email. NAHC will ask for an in-person meeting to make this request, he said.

He would prefer the department to issue a new proposed rule that would restore the DOL’s earlier interpretation of the Fair Labor Standards Act for his industry’s workforce, Dombi added. The Obama administration said in 2013 that an exemption for employees providing “companionship services” and “in-home” domestic services only covers those who work directly for a client, rather than through a third-party agency or other business.

NAHC was part of a coalition that unsuccessfully petitioned the U.S. Supreme Court to review and invalidate the Labor Department’s regulation, which took effect in late 2015. When the high court denied review in June, Dombi said the legal battle was over for the time being.

But a Republican administration keen on easing employers’ regulatory burdens could signal a new opportunity for NAHC and allies to make their pitch to undo the rules.

The rule applies the federal minimum wage and time-and-a-half overtime pay—including time spent driving between consumers—to all home-care workers, regardless of their job duties.

Acosta Awaits Senate Vote

Labor secretary nominee Alexander Acosta is still waiting to be confirmed by the Senate, which could happen as soon as late April.

Acosta hasn’t expressed views on the rule, nor did the issue arise during his March 22 confirmation hearing before the Senate’s labor committee. Controversy over the regulation has taken a back seat to discussion of other rules finalized by the DOL in 2016.

Previous Labor Secretary Thomas Perez, along with worker advocates and unions, strongly support the regulation. They’ve said it’s an important step toward improving wages in a booming workforce and ensuring that providers retain the talent to meet the needs of the elderly and people with disabilities.

If the administration considers a new rulemaking to undo the regulation, it would take time and may face legal challenges.

“These protections are in place and they’ve been in place since 2015. The Department of Labor would need to issue an entire new notice, have an entire new comment period and they would have to argue that things have changed since the new rule went into effect,” Caitlin Connolly, who directs the National Employment Law Project’s “Home Care Fair Pay” campaign, told Bloomberg BNA April 11. “We don’t feel that anything has changed since that analysis.”

A DOL spokeswoman told Bloomberg BNA that it would be premature to speculate on this topic before a new secretary is sworn in.

Debate Continues

During the early stages of the rule’s implementation, some states have been challenged to secure state Medicaid funding to afford compensation raises for the workers. Advocates for people with disabilities have cautioned that unless carefully implemented, the regulation could lead to fewer caregivers and more people forced out of their homes and into nursing homes.

Dombi said he’s hearing from members out in the field that the first 18 months of implementation further prove the rule’s ineffectiveness.

“The new rules have not benefited workers,” Dombi said. “Instead, the new rules have triggered reduced incomes because of work hour limitations that are needed to avoid overtime costs that are not reimbursed by Medicaid and other home care benefit programs.”

But NELP is ready to fight to protect the regulation from industry’s attempt to rewind it, Connolly said.

“We are committed to making sure that these long and hard fought protections stay in place,” she said. “Workers have fought for this for decades, and anything that would erode these protections is unjust and a disservice to them.”

To contact the reporter on this story: Ben Penn in Washington at bpenn@bna.com

To contact the editors responsible for this story: Peggy Aulino at maulino@bna.com; Terence Hyland at thyland@bna.com; Christopher Opfer at copfer@bna.com

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.

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