Companionship-Services

U.S. District Court Blocks DOL Rule Redefining Companionship Services

Overtime Lawsuit Update.

On December 31, Andrea Devoti, Chairman of the National Association for Homecare and Hospice (NAHC) released an update on The Overtime Lawsuit.  The article reads as follows:

U.S. District Court Issues Order Blocking a New Department of Labor (DOL) Rule Which Would Redefine Companionship Services.  Andrea Devoti, Chairman of the National Association for Homecare and Hospice (NAHC) today hailed the decision of the U.S. District Court for the District of Columbia which issued a Temporary Restraining Order (TRO)  blocking DOL from enforcing a proposed new definition of “Companionship Services.”

“This means that our most vulnerable citizens get at least a temporary reprieve from what would otherwise have become a significant cost barrier to their paying for help at home for their chronic diseases.  Without this relief many seniors would be pushed into institutional care,” said Ms. Devoti.

This decision follows on the heels of a December 22 ruling by this same Court which restored the rights of home care consumers to benefit from the “companionship services”  and “live-in” exemptions regardless of whether their caregivers  were employed by persons receiving  the care or by a home care company.

The lawsuit challenges a rule that would have significantly changed a longstanding 40 year old Federal overtime rule known as the ‘companionship exemption’  under the Fair Labor Standards Act.  The new rule would have defined ‘companionship services’ to be primarily “fellowship” and “protection”.  Under the new DOL rule, the exemption would not have applied if home care workers serving patients gave more than incidental personal care services. The proposed rule would have required all current caregivers to be paid overtime compensation in almost all cases.  This change would have lead to higher costs which would have to be borne by infirm individuals or by the states and federal government through financially strapped programs such as Medicaid.

Following the court’s ruling on December 22, NAHC asked the court to stay the effective date of a new narrow definition of “companionship services”, which seemed to have the intent to eliminate two exemptions to overtime rules which benefit patients and home care employers.

In its motion for a temporary stay, NAHC argued that home care recipients, companies, employees, and payers of services would face a risk of irreparable harm if the DOL rule went into effect. NAHC also explained that it would be likely that its claims would succeed on the merits and that the public interest would be best served by maintaining the status quo on overtime exemptions while the lawsuit proceeds.

The effort for temporary relief was supported with detailed affidavits of likely harm submitted by two disability rights advocacy groups, The Centers for Independent Living and ADAPT along with the Kansas state Department on Aging which is concerned about the financial stability of its home care programs if overtime compensation is required.

The next phase of the case will occur quickly, as the court has scheduled a briefing and a hearing on whether a Preliminary Injunction should be issued. A TRO can be in force for no more than 14 days while a Preliminary Injunction can be in effect until a final ruling on the case.  The hearing is set for January 9. The judge indicated that he may rule on the preliminary injunction at the hearing, but he would rule no later than January 13.

During the time in which the TRO is in effect, home care companies can continue to pay home care aides and personal care attendants without added overtime compensation except where state law requires it. Home care companies are advised to consult competent counsel to determine if they qualify to use the exemption. If the requested injunction is granted on January 9, the exemption from overtime will continue until the court’s final ruling or the Court of Appeals reverses the injunction. The Department of Labor has previously indicated that it would appeal any adverse ruling of the court.

“Obviously some well intentioned people in the DOL put forth a rule which they said would be good for patients, helpful to homecare employees, and the companies that hire them, and equally good for State/Federal programs such as Medicaid. The fact is that the proposed regulation would have had exactly the opposite effect on every category.   For this reason NAHC applauds the US District Court for its rulings and will continue to lead the effort in support of the companionship rules as they have been in effect for more than 40 years,  and which have been sustained by a unanimous vote in the U.S. Supreme Court,”  said Chairman Devoti.

January 2, 2015
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