If you have or plan to hire home care aides, you will want to pay close attention to the Companionship Exemption, which is currently a hot topic on Capitol Hill. The decision to be made on this exemption will either allow or prevent minimum wage and overtime (time and half) to be paid to those home care aides working more than 40 hours in a week. To give you a brief background on the topic, we’ve outlined some common FAQs below.
What is the Companionship Exemption?
The Companionship Exemption was originally passed in 1974 and was a change to the 1938 Fair Labor Standards Act (FLSA). The FLSA requires people in certain position types and industries who work more than 40 hours per week to be paid time-and-a-half for overtime. The exemption excluded home care workers from the over-time and minimum wage rules, so home care workers could work more than 40 hours a week at their regular pay rate. Some home care aids liked the exemption because it gave them access to more work hours, especially for overnight stays with a recipient of care.
In 2015 the Department of Labor (DOL) removed the exemption essentially requiring all home care workers to receive overtime if they work more than 40 hours per week. Stakeholders in the home care and caregiving industry had mixed reactions to this change.
- Home care companies are now financially pressured to keep their staff on a 40 hour or less work schedule to keep their expenses down.
- Families and recipients of care are frustrated that they have to hire multiple care aids during a week in cases where care is provided for more than 40 hours a week.
- Some recipients of care are frustrated that they have to build relationships with more than one care aid.
- Care aids are disappointed that they are limited to working only 40 hours a week with one company and thus seeing a reduction in their weekly earnings.
So What Is Happening with the Exemption Today?
The Senate is preparing a bill that would roll back the 2015 DOL regulation change and put the companionship exemption back into place. The exemption could be changed in three different ways:
- The Department of Labor could change or reinterpret the 2015 regulation
- Congress could pass legislation reinstating the exemption
- Congress could create and pass specific legislation making the Companionship Exemption its own distinct law.
Now that you are more familiar with this topic, you may want to keep an eye on it. It could directly impact the cost of home care services.
