[Federal Register Volume 79, Number 196 (Thursday, October 9, 2014)]
[Rules and Regulations]
[Pages 60974-60975]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-24144]
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DEPARTMENT OF LABOR
Wage and Hour Division
29 CFR Part 552
RIN 1235-AA05
Application of the Fair Labor Standards Act to Domestic Service;
Announcement of Time-Limited Non-Enforcement Policy
AGENCY: Wage and Hour Division, Department of Labor.
ACTION: Policy statement.
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SUMMARY: The Department of Labor's (Department) October 1, 2013, Final
Rule amending regulations regarding domestic service employment, which
extends Fair Labor Standards Act (FLSA) protections to most home care
workers will become effective on January 1, 2015. The Department is not
changing this effective date. This document announces a time-limited
non-enforcement policy. For six months, from January 1, 2015 to June
30, 2015, the Department will not bring enforcement actions against any
employer as to violations of FLSA obligations resulting from the
amended regulations. For the following six months, from July 1, 2015 to
December 31, 2015, the Department will exercise prosecutorial
discretion in determining whether to bring enforcement actions, with
particular consideration given to the extent to which States and other
entities have made good faith efforts to bring their home care programs
into compliance with the FLSA since promulgation of the Final Rule.
Throughout the 12-month duration of this policy, the Department will
continue extensive outreach and technical assistance efforts, in
particular with States regarding publicly funded home care programs.
DATES: Enforcement of the final rule published October 1, 2013, at 78
FR 60454: From January 1, 2015, to June 30, 2015, the Department will
not bring enforcement actions against any employer as to violations of
FLSA obligations resulting from the amended regulations; from July 1,
2015, to December 31, 2015, the Department will exercise prosecutorial
discretion in determining whether to bring enforcement actions.
FOR FURTHER INFORMATION CONTACT: Michael Hancock, Assistant
Administrator, Office of Policy, U.S. Department of Labor, Wage and
Hour Division, 200 Constitution Avenue NW., Room S-3502, FP Building,
Washington, DC 20210; telephone: (202) 343-5940 (this is not a toll-
free number), email: [email protected]. Copies of this document may be
obtained in alternative formats (Large Print, Braille, Audio Tape, or
Disc), upon request, by calling (202) 693-0675 (not a toll-free
number). TTY/TTD callers may dial toll-free (877) 889-5627 to obtain
information or request materials in alternative formats.
SUPPLEMENTARY INFORMATION:
I. Non-Enforcement Policy
On October 1, 2013, the Wage and Hour Division of the Department of
Labor (Department) issued Application of the Fair Labor Standards Act
to Domestic Service; Final Rule, 78 FR 60454 (Home Care Final Rule or
Final Rule). The Final Rule amended the domestic service employment
regulations under the Fair Labor Standards Act (FLSA or Act), 29 U.S.C.
201 et seq., which are contained in 29 CFR Part 552. Among other
changes, the Final Rule (1) modified the definition of ``companionship
services'' and (2) prohibited third party employers (i.e., employers of
domestic service employees other than the individuals receiving
services or the individuals' families or households) from claiming
either the companionship services exemption from the FLSA's minimum
wage and overtime compensation requirements or the live-in domestic
service employee exemption from the FLSA's overtime compensation
requirement. See 78 FR 60463-73, 60480-83, 60557 (relevant regulatory
changes to be codified at 29 CFR 552.6, 552.109).
The Department explained in the preamble to the Final Rule that the
changes to the domestic service employment regulations should go into
effect as soon as practicable because they were intended to serve the
important purpose of extending basic labor standards to home care
workers, which in turn helps ensure that individuals and their families
can rely on a professional, trained workforce to provide high-quality
services. 78 FR 60455, 60495. The Department also acknowledged,
however, that complex Federal and State systems fund a significant
portion of the home care services provided across the country, and
making adjustments to operations, programs, and budgets in order to
comply with the FLSA could take time. Id. at 60494-95. Therefore, in
response to comments received in the course of the rulemaking process,
the Department set an effective date of January 1, 2015, an
unprecedented 15 months after the publication of the Final Rule. Id.\1\
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\1\ Typically, employers subject to FLSA regulatory changes have
30 or 60 days to adjust before a rulemaking becomes effective. See 5
U.S.C. 553(d), 801(a)(3)(A). Prior to the Home Care Final Rule, the
longest effective date delay for a Wage and Hour Division rule was
120 days. See 78 FR 60495 (citing 69 FR 22126 (Apr. 23, 2004)).
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Since promulgating the Final Rule, the Department has conducted
extensive technical assistance for the regulated community.
Specifically, the Department has directly reached thousands of people
through over 100 webinars, conference calls, meetings, and
presentations, engaging representatives from State governments,
associations of State Medicaid and other relevant agencies, consumers,
disability and senior citizens' advocates, veterans' organizations,
worker representatives, and industry groups, among others. Furthermore,
to help stakeholders learn more about the changes associated with the
Final Rule, the Department created a home care Web page, which contains
links to fact sheets, FAQs, webinar recordings, interactive web tools,
and other materials, including two Administrator's Interpretations
issued this year in response to stakeholder questions regarding the
application of the FLSA to shared living arrangements and joint
employment of home care workers by public entities in consumer-directed
programs. See www.dol.gov/whd/homecare. Moreover, the Department has
engaged in targeted outreach to the governments of all 50 States.
Through this outreach, the Department has provided extensive technical
assistance to States as they implement the Home Care Final Rule in
publicly funded programs in an effort to encourage implementation of
the Final Rule in a manner that expands wage protections for most home
care workers
[[Page 60975]]
and ensures that Medicaid participants and their families continue to
have access to the critical home and community-based services upon
which they rely, particularly services delivered through innovative
models of care.
Nevertheless, the Department has received requests to extend the
effective date of the Home Care Final Rule, including from the National
Association of Medicaid Directors (NAMD), the National Association of
Directors of Developmental Disabilities Services (NASDDDS), the
National Association of States United for Aging and Disabilities
(NASUAD), organizations representing disability advocates, and the
State of Kansas. The State of Oregon requested an extension of the
effective date, or in the alternative a non-enforcement policy or
waivers for certain States. The States of Maryland and Pennsylvania
also requested an extension. These entities expressed the need for
States to have more time to adjust their publicly funded home care
programs in order to comply with the FLSA, and specifically noted that
time was needed for budgetary, programmatic, and operational
adjustments. The Department has also received requests to implement the
Final Rule on January 1, 2015, as announced at the time of publication,
including from Caring Across Generations, Direct Care Alliance, the
National Domestic Workers Alliance, National Employment Law Project,
Paraprofessional Healthcare Institute (PHI), the National Consumer
Voice for Quality Long-Term Care, the American Geriatrics Society, and
other organizations of worker advocates. These entities wish to see the
nearly two million home care workers in the United States be guaranteed
the basic minimum wage and overtime protections of the FLSA without
delay.
The Department has carefully considered these requests and is not
extending the Final Rule's effective date. When the Final Rule becomes
effective, the regulated community will have had 15 months to make any
adjustments necessary to fulfill new FLSA obligations. Many employers,
including States, are poised to pay home care workers in compliance
with the FLSA's fundamental protections on January 1, 2015. For these
reasons, the Final Rule's effective date will remain January 1, 2015.
The Department recognizes, however, that the implementation of the
Final Rule raises sensitive issues. In particular, the Department has
been committed to assisting the regulated community in considering
methods of complying with the FLSA in a manner that avoids harmful
impacts on the individuals who rely on home care. Additionally, the
Department has historically provided compliance assistance prior to the
enforcement of new regulations, and it will continue to focus on such
assistance during the initial stages of implementing the Home Care
Final Rule. Given the unique effects of this rule, the Department has
been committed to providing extensive compliance assistance, reaching
out to all 50 states individually and providing other varied technical
assistance to States and other stakeholders. Therefore, the Department
is announcing that between January 1, 2015 and June 30, 2015, it will
not bring enforcement actions against any employer as to violations of
FLSA obligations resulting from the Final Rule. See 29 U.S.C. 216(c)
(giving authority to the Department to bring enforcement actions,
including investigating potential violations of the FLSA, supervising
settlements for unpaid wages owed under the Act, or filing suit in
Federal court to recover such wages); see also Secretary's Order No.
05-2010 (delegating this authority to the Administrator of the Wage and
Hour Division). This initial non-enforcement policy will apply to all
employers. During this six-month period, the Department will
concentrate its resources on continuing to provide intensive technical
assistance to the regulated community, in particular State agencies
administering home care programs, regarding the Final Rule and the
application of the FLSA to home care arrangements. Although the
Department will not conduct formal investigations of potential FLSA
violations during this time, any information received during this time
period suggesting non-compliance with FLSA requirements will be used as
an opportunity to provide additional technical assistance to States and
other potential employers in order to facilitate efficient and
effective implementation of the Final Rule.\2\
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\2\ This non-enforcement policy does not apply to FLSA
violations unaffected by the Final Rule, such as those involving
home care services provided by registered nurses and licensed
practical nurses. See current 29 CFR 552.6 (providing that the
companionship services exemption does not apply to services that
``require and are performed by trained personnel, such as a
registered or practical nurse''); 78 FR 60469 (explaining this
existing regulatory provision). Similarly, services provided in
nursing homes, group homes, or other institutions in which the
workers are not domestic service employees fall outside the scope of
the Final Rule and therefore violations in those settings are not
subject to the position described here. See 29 CFR 552.3 (defining
``domestic service employment'' as ``services of a household nature
performed by an employee in or about a private home (permanent or
temporary)''); 78 FR 60461-43 (describing the meaning of the term
``private home'').
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After July 1, 2015, the Department will commence enforcement
actions for FLSA violations resulting from the Home Care Final Rule.
From July 1, 2015 until December 31, 2015, however, the Department will
exercise its prosecutorial discretion in a manner that is consistent
with this document when making determinations on a case-by-case basis
as to whether to bring enforcement actions in the home care context.
During this six-month period, the Department will give strong
consideration to an employer's efforts to make any adjustments
necessary to implement the Final Rule, and in particular a State's
efforts to bring its publicly funded home care programs into FLSA
compliance, in determining how best to use its prosecutorial discretion
in this area. The Department will, as always, consider a variety of
other factors in making enforcement decisions, including the
Department's limited resources, the extent of the violations at issue,
and the impact of a particular enforcement action on compliance more
broadly. The Department's intensive outreach and technical assistance
efforts will continue throughout this period.
II. Regulatory Requirements
This document is non-binding guidance articulating considerations
relevant to the Department's exercise of its enforcement authority
under the FLSA. It is therefore exempt from the notice-and-comment
rulemaking requirements under the Administrative Procedure Act pursuant
to 5 U.S.C. 553(b).
Because no notice of proposed rulemaking is required, the
Regulatory Flexibility Act does not require an initial or final
regulatory flexibility analysis. 5 U.S.C. 603(a), 604(a). The
Department has determined that this guidance does not impose any new or
revise any existing recordkeeping, reporting, or disclosure
requirements on covered entities or members of the public that would be
collections of information requiring OMB approval under the Paperwork
Reduction Act, 44 U.S.C. 3501 et seq.
Authority: 29 U.S.C. 216(c); Secretary's Order No. 05-2010.
Dated: October 6, 2014.
David Weil,
Administrator, Wage and Hour Division.
[FR Doc. 2014-24144 Filed 10-7-14; 4:15 pm]
BILLING CODE 4510-27-P