[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]



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.


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.

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.


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\

    \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)).

    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 
    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\

    \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'').

    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]