On Wednesday, December 17, 2014, 6Beds leaders, Gina Wasdyke, Joy Dela Torre, Janet Valencia, Ron Simpson, George Kutnerian, and Maria Garfinkle, along with prominent labor attorney, Michael Lotito of Littler Mendelson, and lobbyist, Robert Naylor, met with the U.S. Wage and Hour Division’s District Director Susana Blanco and Assistant District Director Michael Eastwood at the Division’s San Francisco district office to explore solutions to the labor issues crippling the small home residential care industry.
Labor auditors over the last few years have shown a high rate of non-compliance among small home residential care facilities according to Eastwood and Blanco. 6Beds pointed out that part of the problem has been auditors’ lack of understanding of the nuances of the live-in caregiver model, which is the foundation of the small home residential care industry and is supported by 29 CFR 785.23 (Homeworker Exception) of the Fair Labor Standards Act (FLSA).
That being said, District Director Blanco expressed that the Wage & Hour Division is willing to work with 6Beds to establish a fair and equitable compliance model that revolves around the live-in caregiver model while adhering to applicable labor laws. To that end, the compliance model will consist of a reasonable agreement between staff and operator based on the live-in model and will include necessary supporting documentation (i.e. time-sheets, etc.). The compliance model will address both actual hours worked and employee living accommodations in the context of the live-in caregiver model within a small home. For the time being, however, both Blanco and Eastwood stated that they will continue with enforcement plans that are already in place. We will, however, have a momentary reprieve with the holiday season upon us.
Both Blanco and Eastwood recognize that residential care homes play a vital role in serving the frail elderly and developmentally disabled adults. They were both very receptive to the idea that the development of a compliance model could help address current labor issues, especially if adopted across the entire small home residential care industry.
To expedite this process of compliance, both parties agreed to a follow up dialogue on January, 15, 2015, at which time 6Beds will present an initial draft of the compliance model written by Littler’s Tammy McCutchen, former U.S. Wage & Hour Administrator. 6Beds will also do the same with California’s DIR (Labor) to ensure that the new compliance model meets both federal and state labor regulations.
The Wage & Hour Division indicated that once a pattern of compliance is established in our industry, the random audits should slow down.
While it’s clear and evident that our voices are being heard, and a solution (compliance model) is in the works, compliance needs to be statewide in order for audits to subside. With that said, we urge every small home residential care provider (2 beds to 99 beds) to join 6Beds and help the industry in its journey to a labor compliance model that will preserve the live-in caregiver model and the economic viability of small home residential care providers—that serve the frail elderly and developmentally disabled adults.