Today, we are pleased to share a guest blog post on Time Reporting from Angelo Spinola, a Shareholder with Littler Mendelson – the world’s largest law practice devoted exclusively to representing management in employment and labor law matters. Angelo has extensive experience defending companies in wage-hour class actions, handling Department of Labor investigations, and assisting companies with compliance measures. Angelo is a core member of Littler Mendelson’s Wage & Hour, Healthcare, and International Law Practice Groups.
Active litigation in the home care industry and regulatory changes have made it particularly challenging for home care companies to stay wage-hour compliant. One of the biggest challenges with wage-hour compliance is knowing how to track and record employees’ working time. Failure to comply with these requirements can lead to costly class-action lawsuits and Department of Labor (“DOL”) investigations. Unfortunately, it is all too often that companies acting with the very best intentions of following the letter of the law find themselves defending their practices to a judge or DOL investigator. For many, the most significant challenges attack policies and procedures for calculating and paying time spent traveling, on-call, in orientation, and during meals and rest periods.
Under the Fair Labor Standards Act (“FLSA”), non-exempt employees – like unskilled caregivers – must be paid minimum wage and overtime. Home care companies must pay these employees for “all hours worked,” which means any time spent on activities that are predominately for the company’s benefit is compensable. Generally, home care companies must pay caregivers for all time spent traveling within the day as part of their normal duties. However, the commute between a caregiver’s home and the first and last worksite of the day is not usually considered compensable travel time. Unfortunately, a common error with the treatment of travel time is the employer’s decision to substitute mileage reimbursement for tracking and paying for actual compensable travel time. Another pitfall for home care companies is a variation of the general rule for travel time known as the “continuous workday.” This theory is based on the idea that a caregiver’s performance of work at home immediately before or after traveling to or from the client’s home makes the home-to-work travel time compensable. For home care companies to defend against travel time claims it is vital that they utilize reliable time-tracking software and implement policies that expressly reference when work is to be completed to make expectations clear.
Time Spent On-Call
Whether a caregiver’s time spent on-call is another area where ongoing litigation and regulations have made compliance difficult for home care companies. Due to the nature of the services provided to home care clients, it may be necessary to request that caregivers remain on-call and be available to assist a client at a moment’s notice. Non-exempt caregivers must be compensated for time spent on-call if the time is spent predominately for the employer’s benefit. This means placing restrictions on non-exempt caregivers such that they are “engaged to wait” will make all of their on-call time compensable. Notably, if a caregiver’s time is spent “waiting to be engaged” then the compensability of that time is different. For example, if a caregiver is relatively free from work responsibilities while on-call, i.e., able to remain at his or her own home and need not immediately respond to calls, merely being on-call is not considered working time. It can be difficult for home care companies to clearly delineate between caregiver time spent “engaged to wait” and “waiting to be engaged” while on-call, but the distinction is crucial for wage-hour compliance. Failure to track and pay caregivers for time spent on-call can lead to tremendous litigation risk and expenses.
A recent trend in home care litigation is the rise in claims brought by newly hire caregivers for failure to pay for orientation time. Home care companies have long-treated orientation periods as non-compensable time or deferred payment until the caregiver accepts a billable assignment. This practice, however, presents significant risks. In general, a caregiver’s orientation time and time spent learning about your company and its expectation is compensable. The time spent completing certain pre-hire paperwork like applications and tax forms is generally not compensable; however, if a caregiver is required to complete this type of paperwork on their first day of work that time will be compensable. Here, the primary consideration is whether the caregiver is considered an “employee” under the FLSA. In other words, if the caregiver is someone who “suffered or permitted to work” their time completing paperwork must be compensated. A more difficult question, and unfortunately one without a clear answer, is whether home care companies must pay caregivers for completing new hire paperwork prior to their first day of work. There is little authority on this issue under the FLSA, but what does exist suggests that if completing certain paperwork is a condition of employment then that time is not compensable. Making the paperwork a condition of employment renders the caregivers prospective employees, rather than actual employees, such that the FLSA does not apply. However, given the lack of authority on this issue, it is imperative that companies carefully review the paperwork they require applicants and newly hired caregivers complete. In addition, I suggest consulting an attorney about this issue.
Meal and Rest Periods
Under the FLSA, employers are not required to provide non-exempt workers with meal periods. This means if an employer decides to pay for all time worked and not treat meal periods as unpaid, the employer need not track meals under the FLSA. If the employer does want to exclude meal time as unpaid, the meal period must be “bona fide,” meaning it must last at least thirty minutes and the worker must be completely relieved from duty. Tracking meal periods in the home care industry is particularly difficult given that most caregivers are working remotely in the homes of clients. Adding to the complexity of this issue is the fact that meal and rest breaks are largely regulated by state law. While the FLSA does not require meal periods for non-exempt employees, some states impose at least a meal break requirement for most types of employees. In addition, many of these states require that workers have the ability to leave the work premises for a meal period to be considered fully relieved from duty. This is another area of wage-hour compliance that I strongly suggest home care companies seek qualified counsel to understand and comply with their obligations under state and federal law.
Conclusion on Time Reporting
The number of wage and hour lawsuits against home care companies has increased dramatically in recent years. Home care companies can and should take proactive measures to defend themselves against wage and hour claims. The wage-hour issues discussed here are among the most frequently litigated compensation practices for home care companies. Unfortunately, navigating the legal nuances and learning how to put effective policies and procedures in place can be an overwhelming endeavor. Thankfully, finding reliable resources has become easier than ever. To learn more about wage-hour compliance and the resources available, I would like to invite you to an upcoming webinar hosted by Rosemark focusing on these very issues and the solutions developed to help keep your company compliant.