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Federal Minimum Wage Standards Are Set to Apply to Home Aides Come 2015

A new regulation issued by the Obama Administration will extend minimum wage and overtime protections to home aides who care for disabled persons and older adults. Starting on January 1, 2015, all home aides will be covered under the Fair Labor Standards Act (FLSA) which requires employers to pay at least the Federal minimum wage and time-and-a-half overtime premium when certain employees work more than 40 hours in a week. Traditionally, the FLSA excluded Home Aides and babysitters from these protections. However, in New York, home aides were already required to be a paid minimum wage under the New York State Labor Law. The new overtime pay requirement under FLSA will be the added benefit to home aides in New York State who often work longer than traditional 40-hr work weeks.

Reported to be one of the fastest growing occupations, the U.S. Labor Department expects the number of home aides to increase by sixty-eight percent, from 1.9 million in 2010 to about 3.2 million by 2020. By including home aides under the FLSA guidelines, the Labor Department seeks to provide stability in an industry where the turnover rate is particularly high. As baby boomers continue to move into retirement the demand for such positions will increase and the need for stability in the industry will follow.

The ruling was received with anxiety from the business sector where many organizations suggest that increased costs will lead to more part-time positions, limit access to home care for individuals that need their services, and will cost the home aides more in the long run. Advocates of the new ruling expressed the benefits for those who care for the most vulnerable in our communities and argued that they deserve added protections.

There are important implications of this new ruling. First, any home aide hired through for-profit home care agencies or third-party agencies cannot be exempt from minimum wage and overtime premiums. There is also no exemption for aides who provide "companionship services," which is defined as fellowship and protection for the elderly, sick, or disabled individual using the services. Furthermore, an aide or companion providing care to the patient, must provide that care for more than 20 percent of their total hours worked per week in order to receive the minimum wage and overtime protections. The ruling defines "care" to include activities of daily living and instrumental activities of daily living. Thus, a companion whose duties includes activities such as dressing, grooming, feeding, bathing, preparing meals, assisting with light house work, and managing finances is not exempt from the regulation. Live-in home aides however, are exempt from overtime pay but not the minimum wage requirement.

While the Administration provided time for agencies and families to adjust to the new ruling, it is important to use this time wisely and stay informed about law changes such as these.

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