We are often asked about caregiver pay and the difference between hourly and live-in care. Senior home care agencies employ caregivers and provide for all of their payroll taxes and worker’s compensation insurance, as required by law. This protects both the caregiver and the senior client they are caring for in the event of an on-the-job injury as worker’s compensation will provide for the caregiver’s needs and the client will not be responsible. The payroll taxes also provide for the caregiver’s retirement benefits through Social Security when they retire. In addition, senior home care agencies have policies in place to protect the caregivers and to make sure the plan of care can be successfully implemented.
Hourly caregivers work a set schedule of hours each week and are paid an hourly rate. Live-in caregivers stay with a client for a few days at a time, sleeping at the client’s home each night and are paid a flat daily rate for their work. Usually live-in caregivers will receive meals and their own room to sleep in.
Senior home care agencies do pay for overtime pay for employees who work more than 40 hours per week as hourly employees, as required by law. However, live-in care is not considered hourly work and is paid at a daily rate and because of this, overtime pay is not provided on an hourly work week for live-in caregivers.
The Fair Labor Standards Act (FLSA) imposes minimum wage and overtime requirements on employers and specifically exempts from overtime any employee employed in domestic service employment to provide companionship services to individuals who, because of age or infirmity are unable to care for themselves. Live-in caregivers meet this requirement. The Department of Labor created a controversy with respect to this exemption several years ago when it adopted seemingly conflicting regulations. One regulation refers to persons who provide services “in or about a private home of the person by whom he or she is employed.” You have to love the legal language – they always seem to take the long way around to get to the point, or maybe they just want to make sure lawyers will always have jobs in order to translate this stuff for us.
The other regulation, which helped confuse matters, expands the coverage to persons who are “employed by an employer or agency other than the family or households using their services.” Legal challenges to this have been made over the years, based on the argument that it is inconsistent to the first regulation.
Then Evelyn Coke, a 73-year-old immigrant from Jamaica, sued New York based Long Island Care at Home for failure to pay her for overtime. A federal court of appeals ruled in her favor, overturning the Department of Labor regulation, determining that it conflicted with congressional intent. Then the Supreme Court reversed this, taking us back to where we started: no overtime pay for companion care services.
It is important to remember that each state maintains their own minimum wage laws and their overtime requirements, and some of these laws are specific to home care workers (this is the the term they use, rather than “caregivers”).
The basic rule you can follow is that “companionship services” are exempt from overtime when the care is not hourly. Companionship services include household work for aged or infirm persons, meal preparation, bed making, laundry and other similar personal services. General household work is also included, as long as it does not exceed 20 percent of the total weekly hours worked by the companion.
Most senior home care agencies have policies in place which require live-in caregivers to sleep at least 8 hours at night, with a minimum of getting up twice to assist the client, along with a couple of hours of downtime each evening. At the point when a senior client needs a caregiver to get up repeatedly at night, which would not allow the caregiver to receive adequate sleep, it is time for the client to switch to hourly care.
Note: most senior home care agencies do pay for overtime hours at time-and-a-half for hourly caregivers who go past the 40 hour work week, even though depending on the state and the type of care assignment, they may not be required to do so.
