In a recent federal court decision out of Pennsylvania, Walsh vs. Elder Resource Management, et. al., a judge determined after a bench trial that a home care provider, a related staffing firm, and their owners were joint employers and, thus, jointly responsible for underpaying home health aides that had split their time working for both the home care agency and the staffing company. The judge in essence held that there was intentional scheduling and case splitting between the two companies, with the intent to deprive the employees of overtime. The two companies shared common ownership and coordinated operations, and the staffing company was not truly independent because it only existed to service the one commonly-owned home care entity. Thus, the Court found, instead of aggregating the total work hours across the two companies, the company’s practice of paying for work hours separately and independently by each company resulted in the aides not receiving earned overtime pay.
The U.S Department of Labor sued on behalf of the workers, and the Judge ordered the two companies and their owners to pay nearly $2.5 million in unpaid wages and liquidated damages.
Home care providers are under increasing pressure to control overtime costs while maintaining continuity of care for high-hour cases. MLTCs will urge the provider to have their aide hired and work for two separate home care agencies in order to service a single patient. Home care providers must be very careful of these arrangements, as this Pennsylvania court decision illustrates. Collusion between two employers in this manner, with the intent to deprive workers of overtime, is unlawful. If you have any questions about this article or its implications, please contact us.