Legal Alert

Labor Classification in the Home Health Care Industry: A Sign of What’s to Come?

July 16, 2018

The U.S. Department of Labor (DOL) on July 13, 2018, issued a Field Assistance Bulletin to its enforcement administrators, explaining how to determine if and when caregiver and nurse registries should be deemed employers under the Fair Labor Standards Act (FLSA). Although this bulletin applies only to home health agencies, it may provide clues as to how the Trump-era DOL will handle the vexing topic of whether to classify certain workers as employees or independent contractors.

In June 2017, Labor Secretary Alexander Acosta withdrew the Obama-era DOL guidance on independent contractors. This action suggested that the DOL would try to return to a more "traditional" view of the employment relationship under his leadership and rein in the more expansive interpretation of employment developed during the Obama administration. Until the latest bulletin, however, Acosta's DOL had done little to address the lingering confusion surrounding worker classification.

This new Enforcement Bulletin lays out numerous factors that a DOL investigator should consider when determining whether a covered worker should be classified as an independent contractor or as an employee. For example, conducting background screening, relaying communications between the client and prospective caregiver, and providing some training to the caregivers are not indicative of an employment relationship.

On the other hand, requiring a caregiver to accept a job with a particular client, visiting the client's home to monitor caregiver performance, conducting evaluations, setting policies for time off from work, or dictating how a caregiver performs duties for a client are all indicia of an employment relationship. Because no single factor is dispositive, the bulletin instructs investigators to analyze the totality of the circumstances in determining whether an employment relationship exists.

This bulletin gives hope to employers that more generalized guidance extending a more conservative interpretation of the employment relationship will be forthcoming. In the meantime, employers will continue to face a patchwork of often conflicting federal and state laws and court decisions.

Click here and here to read recent Ballard Spahr e-alerts addressing worker misclassification. Also, watch for Ballard Spahr's upcoming webinar on employee misclassification and the gig economy.

Ballard Spahr's Labor and Employment Group routinely assists employers in ensuring compliance with the FLSA, National Labor Relations Act, and other state, federal, and local statutes and regulations.

Copyright © 2018 by Ballard Spahr LLP.
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This alert is a periodic publication of Ballard Spahr LLP and is intended to notify recipients of new developments in the law. It should not be construed as legal advice or legal opinion on any specific facts or circumstances. The contents are intended for general informational purposes only, and you are urged to consult your own attorney concerning your situation and specific legal questions you have.

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