Court Rules Home Care Workers Are Entitled To Minimum Wage & Overtime

A federal appeals court has upheld a rule requiring home care agencies to pay the federal minimum wage. Other classes of workers remain uncovered.

Matthew S. Gunby / AP

Nearly two million U.S. home care workers have won the right to a protection most people take for granted: the federal minimum wage.

On Friday, a federal appeals court upheld a Department of Labor rule requiring employment agencies to pay the federal minimum wage and overtime to workers who care for the elderly and sick in their homes.

The ruling brings new protections to a workforce that is 91% female and 56% non-white, according to an analysis of government data by the Paraprofessional Healthcare Institute.

The Service Employees International Union has been working to expand the Fight for 15 movement, which began with a focus on raising wages to $15 for fast food workers, to all low-wage workers, including those in the home care field.

"The women and men who care for our aging moms, dads and grandparents will now be able to provide for their own families, too," said Sarita Gupta, executive director of Jobs With Justice and the co-director of the Caring Across Generations campaign, in a statement.

The decision centered on a three-judge panel's decision that the Fair Labor Standards Act gives the Labor Department authority to determine which types of care work should be covered by wage protections. The current minimum wage is $7.25 an hour.

Home care workers have long been excluded from the Act's coverage, in part due to a broad 1974 Labor Department regulation that exempted "companionship" service from wage- and hour-protections.

Friday's court ruling ends a "sad chapter of racial discrimination that was ingrained in the Fair Labor Standards Act," said SEIU President Mary Kay Henry in a statement. Henry also called on senior and disability rights advocates to now push for a living wage for home care workers.

The Labor Department's decision to extend minimum wage rules to home care workers was challenged in court by the Home Care Association of America, the International Franchise Association, and a third trade association representing the hiring agencies. The federal appeals court rejected that challenge on Friday, saying "the Department's decision to extend the FLSA's protections to those employees is grounded in a reasonable interpretation of the statute and is neither arbitrary nor capricious."

Several classes of workers remain unprotected by minimum wage and overtime laws, including many types of agricultural workers, some domestic workers (such as cleaners and housekeepers), seasonal workers, and employees of small businesses with annual gross sales less than $500,000.

"The decision confirms this rule is legally sound," the Department of Labor said in a statement. "And just as important, the rule is the right thing to do — both for employees, whose demanding work merits these fundamental wage guarantees, and for recipients of services, who deserve a stable and professional workforce."

The remaining challenge for workers and employers will be implementation of the rule — an obstacle that still exists for classes of workers already covered by minimum wage and overtime protection. Many businesses attempt to skirt those laws, and wage theft complaints remain widespread across industries. While investigations are up, a new Labor Department report put the number of workers affected in New York and California alone at 560,000 each week.

"Now it's up to states to ensure that as they implement this rule, no one is harmed in any way by cuts to home care programs or caps on hours," said Gupta.

The Department of Labor is offering technical assistance as well as a 15-month period before the rule's effective date, to aid compliance. "The DOL has repeatedly encouraged states and other employers to take the necessary steps toward implementation," its statement said.