Justices Deny Review of DOL's Home Care Worker Rule

From labor disputes cases to labor and employment publications, for your research, you’ll find solutions on Bloomberg Law®. Protect your clients by developing strategies based on Litigation...

By Ben Penn

June 27 — The U.S. Supreme Court denied review of a home care industry petition challenging the Labor Department's authority to issue a regulation extending minimum wage and overtime protections to in-home care workers ( Home Care Ass'n of Am. v. Weil, U.S., No. 15-683, cert. denied 6/27/16 ).

The denial ends, for the time being, a legal battle over the 2013 DOL regulation, but it leaves major questions about how most states' Medicaid systems can fund additional compensation for home care employees.

The home care industry's 2 million caregivers received new minimum wage and overtime rights under the rule.

The Home Care Association of America, the National Association for Home Care and Hospice, and the International Franchise Association filed the petition for Supreme Court review last November.

In opposing review, the government argued earlier this year that the high court's ruling in another home care wage and hour case, Long Island Care at Home, Ltd. v. Coke, 551 U.S. 158, 12 WH Cases 2d 1089 (2007), already established that the agency may interpret the Fair Labor Standards Act's companionship exemption.

The department's Wage and Hour Division began enforcing the regulation last November following the U.S. Court of Appeals for the District of Columbia Circuit's August 2015 decision to uphold the final rule.

Last October, Chief Justice John Roberts denied an application by the rule's opponents for a stay of the D.C. Circuit's ruling upholding the regulation.

A coalition of trade associations argued in its petition that Coke didn't authorize the DOL's rulemaking.

Industry Exploring New Options

The justices' action concludes the industry's current attempt to block the rule. However, the National Association for Home Care and Hospice and its allies might file a new lawsuit focused on how the regulation is applied, if problems arise, William Dombi, NAHC vice president for law, told Bloomberg BNA June 27.

Dombi, who represented the industry petitioners along with attorneys from Littler Mendelson P.C., said he has been tracking developments during the early enforcement phase of the rule.

Among the areas he's watching are claims filed against private home care firms under state overtime law; how state Medicaid programs are planning to pay for overtime hours; and DOL Wage and Hour Division enforcement, particularly how it counts work hours and whether this includes sleep time.

“From a lawsuit perspective, there is nothing ready for prime time; there may never be,” Dombi said.

DOL, Worker Groups Rejoice

“Today’s decision by the court not to review a challenge to the Final Rule ensures that the rule can fulfill President Obama’s vision of an economy where hard work pays off and responsibility is rewarded,” Labor Secretary Thomas Perez said in a statement. “That will mean greater economic stability for so many hard-working people.”

The National Employment Law Project also rejoiced upon learning of the decision to preserve a rule it said helps a workforce that is mostly comprised of women and people of color. NELP, joined by worker advocacy allies in a June 27 press call, highlighted the economic benefits the DOL has provided for an underpaid and overworked group of employees.

“The Supreme Court's decision not to hear the industry's appeal means … there's no further question that home care employers must pay their workers at least the federal minimum wage for all hours worked and overtime pay for hours over 40 in a week,” said Sarah Leberstein, a senior staff attorney at NELP. “In fact, employers should have already been paying employees according to the rules, as of their effective date.”

Search for Medicaid Funding

But the WHD has said it is aware that many providers are still waiting for their state to allocate necessary Medicaid funding to ensure employees actually receive the added overtime compensation.

The agency also said it is monitoring implementation to ensure the rule doesn't result in the elderly and people with disabilities losing access to community-based care.

“We have two goals: extending basic labor protections to home care workers; and ensuring that Medicaid participants and their families enjoy continued access to the home and community-based services they need, particularly services delivered through innovative models of care,” Perez said in his statement.

Leberstein addressed the Medicaid funding issue during the call with reporters. She said Medicaid programs in New York, California and Massachusetts have already “budgeted funds and revised their pay practices to” provide for additional caregiver wages. “Other states have done the same or are prepared to do so.”

But the NAHC's Dombi disputed this contention. “What we have seen so far is little or no state support to provide higher overtime compensation to these workers, which then limits the options for employers at that point,” he said.

As for enforcement, Dombi said, the DOL “has been very patient with state Medicaid programs. I think there has been really no effort by the private bar to look at state Medicaid programs and managed care entities that might be administering the state Medicaid program on personal care. But I would be very surprised if that didn't happen in the near-term.”

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

To contact the editor responsible for this story: Susan J. McGolrick at smcgolrick@bna.com

For More Information

Summaries of labor and employment law cases denied Supreme Court review appear in Section E.

Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.

Request Labor & Employment on Bloomberg Law