Federal Court Denies Stay Request on IHSS Overtime Ruling
The Washington, D.C. Court of Appeals has denied a request by
home health associations for a stay of its ruling that entitles
home health workers to overtime pay and minimum wage.
Counties will recall that in October 2013, DOL issued regulations making those home care workers paid by third-party providers ineligible for the above-mentioned exemption, thereby extending payment of overtime and minimum wage protections to that population. The regulations also narrowed the definition of “companionship care” to only apply to those who spend less than 20 percent of their time aiding clients in bathing, cooking their meals, managing their medications or performing other personal care services. This essentially broadened the number of home care workers eligible for overtime pay and minimum wage protections even further. Accordingly, the 2014-15 state Budget Act included a negotiated deal between the Brown Administration, Legislature and labor representatives to implement the federal overtime rules to apply to California’s IHSS workers as of January 1, 2015. The Administration had estimated the cost for complying with the regulations to be $403.5 million in 2014-15 and $707.6 million annually thereafter.
Almost immediately following the issuance of the DOL regulations, the agency was challenged in a lawsuit by the Home Care Association of America in an effort to block its implementation. In December 2014, the federal court ruled that the portion of the regulation that made home care workers paid by third-party providers eligible for overtime pay and minimum wage protections exceeded DOL’s authority and subsequently delayed implementation of the regulations. Under state law, California’s implementation of overtime was also delayed pending further action by the federal court.
The denial for a stay means that the DOL rules will go into effect this November, even while the plaintiffs appeal the case to the United States Supreme Court (they have 90 days to do so). The California Department of Finance has said that $270 million already has been allocated for covering overtime pay for IHSS workers – the state’s implementation of the rules was pending while the case was reviewed and may remain on hold if the ruling is appealed to the Supreme Court.