Barkan Meizlish , May 14, 2015
The “companionship services” exemption of the Fair Labor Standards Act (FLSA) exempts employees providing domestic or companionship services from the minimum wage and overtime pay requirements of the FLSA. On October 1, 2013, the Department of Labor (DOL) issued a final rule, which revised the definition of “companionship services” by limiting the duties and circumstances that must be satisfied in order for the exemption to apply. One of the changes it provided was that individuals directly employed by the person receiving services would remain exempt, yet home health care agencies and other third-party employers would be unable to claim this exemption. The rule was set to take effect on January 1, 2015.
About a week before this effective date, however, the U.S. District Court for the District of Columbia in Home Care Association of America v. Weil struck down the part of the DOL’s regulation applicable to third-party employers, holding the DOL exercised authority that was inconsistent with the intent of Congress. Analyzing the statutory language, the court reasoned that Congress had clearly spoken on this issue, and intended the companionship services exemption to apply to all employees. The remaining portions of the new regulations, which changed the definition of “companionship services,” were not affected by the lawsuit.Source: Angelo Spinola & Lucas E. Deloach, D.C. federal court vacates regulation excluding third-party employers from the FLSA companionship and domestic services exemption, Dec. 22, 2014, http://www.lexology.com/library/detail.aspx?g=f4cc9e04-8bdf-478f-9eca-7b0e9a4f295c.
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