In the evolving landscape of home care, recent legal developments have set the stage for significant changes that directly impact how agencies classify and manage their workforce. This blog post dives into the upcoming developments impacting the home care industry and how you can be best equipped to remain compliant.
To watch our recent webinar with Angelo Spinola of Polsinelli, click here.
Workforce Regulations
The Department of Labor (DOL) has introduced a new rule, effective March 11, which revises the standards for distinguishing between employees and independent contractors under the Fair Labor Standards Act (FLSA). This new regulation employs a non-exhaustive six-factor “Economic Realities Test,” focusing on elements such as:
- The worker’s opportunity for profit or loss
- The investments made by both the worker and the potential employer – such as equipment cost, background checks, uniforms, training, etc.
- The degree of permanence and control within the work relationship
- The use of worker’s skill and initiative
- Degree of control employer has over the work
- The extent to which the work performed is integral to the employer’s business.
Independent Contractors to Meet Staffing Needs:
For those of us in the home care sector, this change can have a major impact. Traditionally, our industry has leaned on the flexibility of employing independent contractors to meet staffing needs, especially with the current hurdle of caregiver retention and recruitment. However, under the new rule, the burden of proof increasingly falls on agency owners to demonstrate that these workers are indeed independent contractors. This is critical as the DOL is likely to scrutinize our employment practices more closely, potentially viewing many contractors as employees of the provider, or even the state, rather than independent entities.
Are You at Risk of Audit?
This heightened scrutiny poses significant implications for agencies, especially those operating with a hybrid model of 1099 contractors and W-2 employees performing similar roles. The stakes are high, with an increased risk of findings against agencies for back wages during DOL audits—a scenario becoming all too familiar, as 89% of agencies audited find themselves facing such challenges.
What does this mean for our day-to-day operations? From ensuring meticulous compliance with wage and hour laws, including properly documented pay rates and reimbursed travel time, to the handling of pre- and post-shift work, it’s necessary to be on top of compliance and regulations.
Remain Compliant with AxisCare and Polsinelli
Navigating these changes requires a conscious effort to stay informed and adapt our practices to remain compliant while continuing to provide high-quality care. It’s a gentle reminder of the importance of understanding the legal landscape and its implications on our operations and the lives of those we serve.
For more information on both state-specific and national legislation that can impact your agency, check out POSH, Polsinelli’s dedicated legal team for the home care industry and one of AxisCare’s partners.
To learn more about AxisCare’s platform and continued efforts in helping your agency remain compliant with features such as custom forms and geo-fenced clock-ins, book a demo to learn more.
Disclaimer: This blog post is not a comprehensive guide on upcoming legislative changes for the home care industry, merely a reference and does not serve as legal advice.
