Effective January 1, 2015, almost 2 million home health and personal care workers will be entitled to be paid at least the federal minimum wage and receive overtime pay, under a final rule announced by the U.S. Department of Labor on September 17.  According to new Secretary of Labor Thomas Perez, the final rule will give home care workers “parity” with direct care workers who work at institutional settings and will “ensure that direct care workers are available to elderly people who want to remain in their homes.”

The new rule will apply to all home care workers, including live-in workers, who are employed by a third party such as a home health agency.  The rule will also require the family of an elderly or ill person when the worker performs medical duties or primarily performs domestic duties that benefit other household members.

According to DOL, the “vast majority” of the affected workers are employed by third parties and only a “very small” number of workers employed by families will be affected by the rule.  Supporters of the rule argue that it will lift home care workers out of poverty and keep them in the workforce, thereby enabling them to help elderly and ill people in the comfort of their homes.  Opponents assert the rule will reduce the work hours to avoid overtime and will result in pay reductions to home care workers, force patients out of their homes and into institutions and reduce business for home health agencies.  Rep. John Kline (R-Minn.), chairman of the House Education and the Workforce Committee, stated that DOL has estimated the rule would increase the cost of home care by $2 billion over the next decade.