Many individuals who hire in-home carers imagine them to be like teenyboppers: You decide on an hourly rate (say, $40 to cover your evening out), and a few hours later, when you get home, you give them the money and tell them to go on their way. Very likely, you don’t bother to notify the IRS of the payment.

While in-home caregivers have traditionally been considered similar to babysitters, federal rules have made it clear that they don’t have many similarities with them and cannot be treated in the same ways. The U.S. Department of Labor detailed rules for in-home elder care employees with effect from January 1, 2015, and it offers a useful online self-assessment for families to use in determining if they must pay federal minimum wage and overtime compensation.

For purposes of legal categorization, domestic service employees who are engaged independently to provide care in a private home, such as home health aides (HHAs), personal care aides, certified nursing assistants, and senior carers, are covered by the Fair Labor Standards Act (FLSA). During all of the hours they are providing services, they must be paid the federal minimum wage. They are eligible for overtime compensation if they put in more than 40 hours each week. The typical family seeking in-home elder care services, however, is unfamiliar with the specifics of these regulations or how to apply them.

Choosing between a Home Care Agency and an Individual Caregiver

Families may hire in-home care in one of two ways: individually via registration or recommendation, or through a home care agency. Home care agencies serve as a form of “middleman” for families and third-party employers for professional carers. For its customers and employees, agencies take care of administrative tasks including hiring, background checks, training, scheduling, bonding, workers’ compensation, payroll, and taxes.

If a family chooses to engage an independent caregiver who is not connected with an agency, the administrative aspects are considerably different. In this case, the family takes the role of the employer and is in charge of the aforementioned duties as well as making sure that labour laws (such as those pertaining to overtime pay) and IRS regulations are fulfilled. Although it is generally accepted that hiring a private caregiver is less costly, there are several crucial aspects you should consider before assuming the time-consuming position of an employer.

When Are Overtime Charges Paid to Caregivers?

CEO of Amada Senior Care Tafa Jefferson is well-versed in the laws regulating in-home care. In order to assist families in determining if and when private caregivers are eligible for overtime compensation, he boils down the most crucial criteria into four straightforward questions.

Does your caregiver have the legal requirements to provide domestic services?

Domestic service employees “perform services of a household kind in or around a private home,” according to the Wage and Hour Division of the U.S. Department of Labor. The FLSA protects domestic service employees, which means that unless they qualify for an exemption, they must be paid at least the federal minimum wage for all hours worked plus overtime compensation at time and a half the normal rate of pay for any hours worked above 40 in a workweek.

While the answer to this basic question seems to be straightforward, Jefferson emphasizes that it isn’t always obvious. When it comes to defining a “private residence” and “domestic services,” there are certain ambiguities.

“A domestic service worker may only be employed as a caregiver in a dwelling that is legally recognized as a private home,” he asserts. If your loved one was previously residing in the location where they are currently getting care, who owns the property, who maintains the residence, and whether it is a group setting are all factors that must be taken into account when determining the definition of a private home. To determine whether a family must adhere to the rules for paying a direct care worker, the total living condition is taken into account.

See Fact Sheet #79: Private Houses and Domestic Service Work Under the Fair Labor Standards Act for additional information on what constitutes a private home (FLSA).

Does your caregiver spend most of their time providing “care” rather than “companionship”?

The “companionship services” exemption, according to Jefferson, is “one of the most often utilized exclusions that may be used to exclude in-home employees from minimum-wage and overtime eligibility.”

This exception applies to domestic service employees whose principal duty is to give companionship (i.e., fellowship and protection) to an aged or ill individual. They are exempt as long as they devote at least 80% of their time to being a companion and no more than 20% of their time to rendering any kind of “care” services.

Assistance with activities of daily living (ADLs) and essential activities of daily living are considered to care services (IADLs). Care includes assistance with clothing, grooming, eating, bathing, and urinating, as well as less labour-intensive tasks like food preparation, light cleaning, driving, and scheduling doctor visits.

The worker is legally classed as a nonexempt domestic service worker and is required to be paid at least the minimum wage, plus overtime as necessary, once this 80/20 level is exceeded.

See Fact Sheet # 79A: Companionship Services Under the Fair Labor Standards Act for additional details on the guidelines governing this exemption (FLSA).

Do they put in at least 40 hours every week?

When a caregiver is with your loved one at home, we may not conceive of them as being “on the clock,” but according to Jefferson, they are often working and need to be paid like any other non-exempt worker. As a result, individuals are required to work at least 40 hours every workweek (any set and regularly occurring period of 168 hours—seven consecutive 24-hour periods) and to be paid overtime for any additional hours worked. Although the caregiver is not technically entitled to payment, it is crucial to record all hours worked on a printed timesheet and include breaks for meals and rest.

Does your caregiver remain for the whole night or only for meals?

While they often spend a lot of time in homes, caregivers are usually self-sufficient enough to schedule their own meals and break around the care they are providing. Jefferson stresses that, as an employer, “you are required to keep account of these breaks in writing since it impacts the hours they are believed to be working and entitled to pay.”

You must keep track of when your caregiver takes breaks and allow them enough time to take a legitimate break from work if they consume meals or sleep on the property. This time may no longer be regarded as a break if services are required when they are supposed to be off duty and they have to interrupt their break to take care of them. Even if overtime pay is triggered, the caregiver is still entitled to payment for the time that was supposed to be a break period.

If you answered “yes” to any of the four questions above, your caregiver is probably eligible for overtime compensation if they put in more than 40 hours each week. Whether to provide an independent caregiver extra compensation might be tricky, particularly if they reside with the client. However, it is your responsibility as a private employer to be aware of whether your employee satisfies the legal requirements for domestic service employment, monitor the number of hours worked, comprehend what a bona fide break entails, and differentiate between an in-home companion and a real caregiver.

Families wishing to employ elder care services for elderly loved ones sometimes face the additional responsibility of managing payroll, tax withholdings, and recordkeeping for a private caregiver. You might consult a qualified home care firm if you’re hesitant to take on all these administrative duties.


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Are you looking for compassionate and reliable home care services in Orange, Osceola, Brevard, or Seminole counties? Look no further than our professional team at Embracing Home Care! Our highly trained caregivers provide personalized care for seniors and individuals with disabilities, ensuring that they can continue to live independently in the comfort of their own homes. With a variety of services including personal care, transportation, meal preparation, and companionship, we strive to improve the quality of life for our clients and provide peace of mind for their families. Contact us today at 321-758-2036 to learn more about our affordable and flexible home care options and to schedule a consultation with one of our care coordinators. Let us help you or your loved one live life to the fullest!  We serve Central Florida cities like Orlando, Apopka, Ocoee, Winter Garden, Sanford, Altamonte Springs, Casselberry, Palm Bay, Melbourne, Titusville, Kissimmee, St.  Cloud, Celebration, Lake Mary, Oviedo, Longwood, Winter Springs, Cocoa Beach and more.

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