When you come home from date night and get out your wallet to pay the babysitter, do you worry about whether you’re paying enough according to federal minimum wage and overtime laws? Probably not. That’s because you assume – correctly – that if a teenager from across the street watches your toddler for a few hours, that is not governed by federal wage and hour regulations. The Fair Labor Standards Act, the federal law that requires payment of minimum wage and overtime, contains an exemption for “companionship” workers, like babysitters.
But for years now, that exemption for “companionship” workers has been a loophole you could drive a truck (or at least a double-stroller) through. The “companionship” exemption has been interpreted to include not only teenaged babysitters or mother’s helpers, but also skilled home care workers who are employed by agencies full-time to provide domestic care to elderly or disabled clients.
It includes individuals like Evelyn Coke, who worked for a home care agency for twenty years providing in-home services to elderly clients, and worked long hours for sub-minimum wages and no overtime. Evelyn sued her employer for failure to pay minimum wage and overtime, but the Supreme Court unanimously rejected her claims, concluding that Evelyn fell within the companionship exemption.
There are about 2 million home care workers across the country, and that number is likely to rise dramatically as more and more baby-boomers need home care. Like Evelyn, many of these employees work long (sometimes around-the-clock) hours providing care to their clients, and yet their employers do not pay them minimum wage or overtime. And it’s completely legal.
But that’s about to change. Last week, the Obama administration announced that it is issuing new rules to extend minimum wage and overtime protections to home care workers. The change won’t happen right away – the law doesn’t go in effect until January 1, 2015 – but for many workers, it’s a long-awaited announcement.
This change comes as many home care workers are struggling to make ends meet. Home care workers earn a median wage of just $9.70/hour, or about $20,000/year. In New York City, 60% make poverty wages and 1/3 earn less than $15,000 a year. Wages are so low that over 40% of aides receive means-tested government benefits, such as food stamps and Medicaid. Over 90% of home care workers are female, and about 50% are people of color.
Opponents have argued that the change will have dire consequences, leading agencies to cut home care workers’ hours to avoid paying overtime, and causing some individuals to be unable to afford home care. But 15 states already mandate minimum wage and overtime pay for home care workers, and none of those grim predictions have materialized.
A home care worker named Lauralyn Clark, who earns $8.87 an hour, said it best: “We work hard to give our clients a good quality of life. This way, we will be able to have one, too.”
If you believe your rights have been violated, contact us.