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Do I need to pay my senior caregiver overtime or minimum wage?

The nature of the services you require from your senior caregiver determine your obligations for overtime and minimum wage payments. Domestic employees, including  senior caregivers, have been covered by the Fair Labor Standards Act (FLSA) since 1974. Please note that many states have stricter laws and standards than the FLSA, and the applicable law is the one that most benefits the worker.

Companionship Services

In 2015 the definition of “Companionship Services” that are exempt from the FLSA’s minimum wage and overtime regulations changed significantly. To qualify as companion care, the caregiver:

  • Must be employed by a private family, not an agency.
  • The services provided must be those related to companionship/fellowship and the physical safety of the care recipient.
  • Personal care services may not exceed 20% of the caregiver’s services.

A caregiver that provides any housekeeping services DOES NOT meet the definition of a companion under the new regulations and is therefore entitled to be paid at no less than the minimum wage and must be paid overtime if they are not a “live in” caregiver. Live in is defined as the employing family’s home is the caregiver’s primary residence, and the caregiver is in the residence at least 120 hours weekly.

Bona fide companions typically live in with the senior. Companionship services includes conversation, company, reading or game playing, limited personal care services such as assistance with bathing and dressing, and helping to keep the care recipient physically safe.

Domestic Services

Senior caregivers who perform general household tasks – vacuuming, dusting, dishes, cleaning, grocery shopping, meal preparation for other family members – for ANY amount their time ARE covered under the FLSA as domestic service workers. These caregivers typically come and go, although they are occasionally live in workers.

Minimum Wage for Domestic Service Workers

Domestic service workers must be paid at least the minimum wage for every hour that they work. The FEDERAL minimum hourly rate is $7.25 per hour effective July 24, 2009. If your state imposes a minimum wage higher than the Federal minimum, the state amount is in effect.
» Minimum Wage by State

Senior Caregiver Overtime

Senior caregivers who are NOT companions are covered by the FLSA’s overtime rules. Overtime compensation coverage hinges on whether the household worker lives in (on the premise) or lives out (come-and-go). You are required to pay a senior caregiver who is a domestic service worker and lives out overtime (for hours above 40 in a week **). Overtime is one and one-half times the normal hourly rate. Live-in senior caregivers who are NOT companions must be paid for every hour they work but are not automatically entitled to the overtime differential. (There are some exceptions to the live-in exclusion, notably CA, NY, NJ, MD, MN and OR.) If the household employee receives a “salary” that covers a work week of more than 40 hours, your employment agreement must explicitly state the regular and overtime rates of pay. See our exclusive Hourly Rate Calculator for help.

Hours worked includes  all hours on duty, including meal time if the employee is required to remain at the premises during meals, time when the care recipient is sleeping or napping, and all time that the employee is required to be at the employer’s home and all time that the employee is required to be ‘on call’ in the course of his/her duties.

* Many states have laws that override the FLSA’s Companionship exemption. The law that most benefits the worker is the one that must be followed.

** California household employees who live out and whose duties are not strictly limited to those of a “personal attendant” are entitled to the overtime differential for hours work over 8 in a day. So a schedule of 4 10-hour days is paid as 32 hours at the regular rate, and 8 hours at the overtime rate. In general, California has a number of rules and regulations that impose MORE duties and responsibilities on the household employer than Federal law does. We recommend you read EDD’s Household Employer’s Tax Guide for California-specific advice.

» Minimum Wage by State
» Senior Caregiver Minimum Wage Rules

Resources:

» Privately Employing a Senior Caregiver
» Guide to Privately Hiring Senior Caregivers

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