U.S. SUPREME COURT UNANIMOUSLY UPHOLDS
COMPANIONSHIP SERVICES EXEMPTION
On June 11, 2007, the U.S. Supreme Court, in Coke
v. Long Island Care at Home, Ltd, upheld the U.S. Department
of Labor’s regulations exempting from minimum wage
and overtime certain persons “employed in domestic
service employment to provide companionship services for
individuals” who are “unable to care for themselves.”
Background
The U.S. Department of Labor’s (DOL) regulations
interpreting the Fair Labor Standards Act (FLSA) exempt
employees who perform “companionship services”
for the aged or infirm from federal minimum wage and overtime
requirements. Employees whose work involves providing companionship
or performing personalized services (such as meal preparation,
bed making, washing of clothes, etc.) fall within the exemption.
However, if such employees also perform general household
work exceeding 20% of the total weekly hours worked, the
exemption will be lost. Further, the exemption does not
apply to services “which require and are performed
by trained personnel, such as registered or practical nurses.”
29 C.F.R. § 552.6.
Evelyn Coke, a worker employed by a home care service
company to provide companionship services to the elderly
and infirm, challenged the legal validity of the regulation,
and the U.S. Court of Appeals for the Second Circuit ruled
the regulation invalid.
The Court’s Ruling
The Supreme Court reversed the Second Circuit and held
that the companionship services exemption is a valid regulation.
The Court ruled that the DOL’s interpretation of this
provision was entitled to deference, since it reflected
the agency’s fair and considered judgment on the matter
and was subject to the agency’s notice and comment
procedures.
Implications of the Decision
While the Supreme Court’s decision settles the issue
of whether the companionship services are exempt from federal
minimum wage and overtime rules, employers should remember
that certain State laws, such as the Maryland Wage Payment
and Collection Act, do not mirror the Federal FLSA on this
issue. For example, Maryland law limits the exemption to
an employer that is: “a not for profit entity and
is engaged primarily in providing temporary at-home care
services, such as companionship or delivery of prepared
meals, to aged or sick individuals, individuals with disabilities,
or individuals with a mental disorder.” MD Ann. Code
LE § 3-415(b)(6). Hence, this overtime exemption does
not apply to a for-profit entity. Thus, under Maryland law,
while an employee engaged in providing companionship services
may not be entitled to overtime under the FLSA, such employee
may still be entitled under Maryland law to be paid overtime
for any hours worked in excess of 40 within a given week.
Shawe
Rosenthal, LLP provides this publication for informational
purposes, and it should not be construed or relied upon
as legal advice. You should contact your Shawe Rosenthal,
LLP lawyer to discuss any questions that you may have concerning
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