Time is Running Out to Show Support for 1.8 Million Home Care Workers

If you follow our blog, you know that the Department of Labor has proposed a rule that would extend basic labor protections – minimum wage and overtime protection – to home care workers who have been excluded under an exemption for “companionship services.” The Fair Labor Standards Act was amended in 1974 to include domestic service workers, but millions of home care workers never got to enjoy the basic protections included in that law. Instead, these professional workers (about 90 percent of whom are women) have been put in the same category as teenaged babysitters or neighbors who stop by to check in on an elderly person. As a result, the home care industry has a very high turnover rate – estimated to range from 44 to 65 percent each year – which diminishes quality and continuity of care for clients and costs the industry an estimated $2 billion annually. It has been almost 40 years since other domestic service workers gained wage and hour protections. Home care workers shouldn’t have to wait anymore!

Unfortunately, many companies in the over-80-billion-dollar home care industry are working hard to prevent home care workers from receiving basic labor protections. The industry has found an ally in some Members of Congress who petitioned the Department of Labor to extend the public comment period for the proposed rule – even though the Department announced almost 2 years ago that it was looking into the issue and over 5000 comments had already been received. The House Subcommittee on Workforce Protections is going to hold a hearing on this issue on March 7. Although the official witness list hasn’t been announced, we anticipate that the industry will be well represented and we know what their witnesses are likely to say: that the rule would be too expensive and that it would hurt, not help, home care workers. Let me take a moment to debunk those myths right now.

Opponents of the rule like to claim that it will be so costly that home care will become unaffordable, driving people into nursing homes. The truth is that the estimated national cost of the rule change is less than one tenth of one percent of the annual revenue of an industry in which 30 to 40 percent profit margins are “not uncommon.” Agencies charge their clients $19 to $21 per hour, while home care workers’ median wage is below $10 per hour. The wage paid to the lowest-paid quarter of home care workers is below the federal minimum wage of $7.25 per hour. No wonder agency profit margins are so high.

Opponents also like to say that the rule will actually hurt home care workers because agencies will cut down on overtime rather than paying time-and-a-half, forcing workers to make do with less or get a second job. In reality only about 1 in 10 home care workers work more than 40 hours a week for any one employer. Some of those workers are already covered by state overtime laws – 16 states extend both minimum wage and overtime protection to most workers who are excluded under the current federal rule. If agencies do need to adjust schedules to limit overtime costs, hours can be shifted to workers who need and want them; more home care workers work part time for involuntary reasons than other health workers and workers in general, and 40 percent of home care workers want more hours.

The Department of Labor extended its public comment period on the rule, which was originally scheduled to end February 27, to March 12. The home care industry and its allies advocated for the delay and will use the extra time to continue submitting comments, so we must do the same! You can help by commenting in support of the proposed rule by March 12. For ideas on what to write, take a look at the comments NWLC filed or visit PHI PolicyWorks for more examples. With your help, this proposed rule can become binding and help nearly 1.8 million home care workers.