Report raises alarms about outsourced home care workers

New Labor Regulations May be Difficult to Enforce
New Labor Regulations May be Difficult to Enforce

New labor protections for the nation’s fast growing workforce of in-home care workers for the elderly and people with disabilities may be largely unenforceable, without further structural changes, the National Employment Law Project asserts in a new report released January 5.

“Years of organizing have secured critical reforms that can potentially elevate the low wages and poor conditions that have long plagued the industry…But home care workers’ hard-won victories could be undermined by a fundamental weakeness in the structure of the home care industry: the industry’s pervasive outsourcing of employer responsibility for home care workers, combined with a lack of tools to hold employers accountable.”

For decades, the Fair Labor Standards Act contained an exception for in-home care workers, otherwise known as the “companionship,” or by its critics the “babysitter,” exception. Under new regulations promulgated by the Obama Administration, recently upheld in federal court after a lengthy legal battle, the exception no longer applies for workers employed by third parties.

Public programs, such as Medicare and Medicaid, cover 83 percent of home care services nationwide. Most states contract with private organizations to run nursing facilities and other services.

Many of these organizations have long sought to avoid liability concerns by hiring workers as independent contractors, as opposed to employees. As detailed in the NELP report, this designation creates a loophole to avoid complying with the new minimum wage and overtime rules.

The NELP calls on federal and state governments to use their leverage in the contracting process to push for improved worker standards. It also calls on governments to force contractors to publish detailed wage and hour data, create strong legal compliance review procedures, and enforce federal contracting rules, among other recommendations.

Nationwide, the average annual earnings for in-home workers is just $18,598 and more than half receive some form of public assistance, according to data cited in the report.

The report, Upholding Labor Standards in Home Care: How to Build Employer Accountability into America’s Fastest Growing Jobs, can be read here [PDF].