In This Issue:

Executive Corner

Feature Article

Public Policy/Advocacy News

Member News

Featured Associate Members

Welcome the Newest Members of HCAOA

Executive Corner

As I am writing, the HCAOA staff is making final preparations for the 2015 HCAOA Annual Leadership Conference scheduled for September 27-30 in Washington, DC. If you haven't registered to attend, I urge you to do so today! (See related story) Don't miss out on the premier private duty home care event of the year. This year is particularly important as we are sponsoring the first ever HCAOA Annual Leadership Conference Congressional Lobby Day. Your participation in the political process through scheduled visits with members of Congress cannot be underscored as we continue to battle threats facing the home care industry.

Of note, on August 31, the U.S. Court of Appeals for the District of Columbia Circuit reached a decision to uphold the Department of Labor's (DOL's) Home Care Rule, reversing the district court's decision that had vacated the Rule in Home Care Association of America v. Weil. Last year, HCAOA challenged the rule in federal district court. The court ruled in our favor, finding that the new Home Care Rule was not consistent with Congress's intent to exempt home care employees from the overtime requirements of the Fair Labor Standards Act (FLSA). The DOL appealed that decision to the D.C. Circuit, which has now reversed the district court.

As previously reported, HCAOA along with coalition partners, the International Franchise Association and the National Association for Home Care and Hospice, are taking legal action with the court of appeals to stay the issuance of the mandate, or effective date, of its August 21 decision, pending a filing of a petition for writ of certiorari to the Supreme Court.

On September 1, HCAOA (HCAOA Motion) and the Department of Labor (DOL) (DOL Motion) filed cross-motions seeking to alter the current effective date of the Court of Appeals' decision upholding the DOL's Home Care Final Rule. We argued there is good cause for the stay, especially because the court's decision would cause irreparable harm to the home care industry's compensation models, impacting not only home-care related businesses, but also the clients being served. The DOL countered by filing a motion to expedite the issuance of the mandate, essentially requesting that the court allow the Home Care Rule to go into effect before the current October 13 deadline. In support of its motion, the DOL reiterated its previous position "that, through December 31, 2015, it 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 regulations." The DOL also indicated that it "will not bring enforcement actions against any employer as to violations of FLSA obligations resulting from the amended regulations until 30 days after the mandate issues."

As part of HCAOA's efforts, we will be seeking support from other stakeholders in the form of amicus briefs. We will be approaching Members of Congress, as well as groups representing the disability and senior communities. In addition, HCAOA is considering legislative options in Congress and will pursue legislation that would ultimately preserve the companionship services exemption in the FLSA. This issue will be a primary talking point in the scheduled Hill visits with members of Congress during the Congressional Lobby Day.

As HCAOA continues to support efforts at the federal and state levels to address worker misclassification, highlighting this issue of The Voice is our featured article on Uber-Style business model start up companies and how they may be misclassifying workers. In addition, the Public Policy/Advocacy News section recaps key issues we are covering on the federal and state level. The Members News section includes a final reminder on our 2015 Annual Leadership Conference that will be held in our nation's capital, Washington, DC, September 27-30.

I look forward to seeing you in Washington, DC.

Feature Article

The Uber Model and the Future of Home Care Workers

HCAOA Continues Effort to Shed Light on 'New' Silicon Valley-Supported, Uber-Style Business Models Popping Up, and How They May Be Misclassifying Workers

The pressure on Uber-style, or app-based companies, to reclassify their contractors as employees is heating up. Regulators from California to Washington, D.C. are trying to determine when a worker is an employee in an economy that increasingly relies on contractors and temporary hires. Most notably, rideshare service Uber, the San Francisco-based developer of ride-sharing software for drivers and passengers, has been facing the possible rupture of its entire business model in a recent case that could have even further reaching implications for HCAOA members, as well as the overall U.S. economy.

As you may be aware, Uber has been facing accusations that it illegally misclassifies its drivers as independent contractors rather than employees, therefore avoiding responsibility for a variety of wage and hour protections afforded to employees.

The new tech-style business model has spawned a whole industry of workers who are considered to be independently freelancing their services, rather than formally employed by a company. Other app-based endeavors, including Honor and Lyft, bill themselves not as employers but as a platform through which ordinary people can obtain services. As a result, these companies can get around paying a host of benefits, saving thousands per person, per year by treating workers as contractors.

So, how does this impact HCAOA members? Many of these new ventures appear to use independent contractors and follow a similar model to domestic referral agencies, giving the appearance of being more cost effective. However, these models do not absorb the additional costs that HCAOA home care companies bear using the employer model.

The on-demand companies that connect users to services through apps have typically argued that reclassification as employees would mean that people would lose the flexibility that they get from working for these companies. Reclassification could also drive costs up for these companies, with an impact on their business and pricing model.

Currently, it's the role of federal and state government agencies and the courts to ensure that startups don't abuse existing independent contractor rules to exploit those workers who should really be classified and compensated as standard "W-2" employees. But as the Uber-style business model continues to proliferate, public policymakers may begin to consider replacing these employment policies developed almost a century ago with ones more suited to the times.

States must continue to support federal efforts on the part of agencies to work together to protect the rights of employees, with the goal of leveling the playing field for responsible employers by reducing the practice of misclassification. Part of this effort involves combating employee misclassification and ensuring that workers get the wages, benefits and protections to which they are entitled.

Misclassification in the home care industry means caregivers are not just denied minimum wage and overtime, but other safety net protections, like workers compensation and unemployment insurance.

HCAOA believes that as the misclassification issue continues to blur and grow, it's critical that we work to provide workers and employers with a clear understanding of what makes a worker an employee. As previously reported, the U.S. Department of Labor (DOL) Wage and Hour Division recently issued interpretive guidance recognizing that additional guidance regarding the application of the standards for determining who is an employee under the Fair Labor Standards Act (FLSA) may be helpful in classifying workers and ultimately in curtailing misclassification.

Furthermore, HCAOA is supporting legislation in the U.S. Congress sponsored by U.S. Senator Bob Casey (D-PA) and Rep. Frederica Wilson (D-FL) (S.1896/H.R. 3427) to address payroll fraud, which occurs when an employer misclassifies a worker as an independent contractor rather than employee. Known as the Payroll Fraud Prevention Act, this legislation would crack down on misclassification practices and prohibit companies from using worker misclassification to avoid taxes. HCAOA supported this legislation when it was previously introduced during the 113th Congress. Further information on this issue is available on the DOL misclassification website HERE.

We will be following any new developments closely, and will keep members posted as similar models develop.

Public Policy/Advocacy News

Obama and Congress at Odds on Sick Leave Policy

On September 7, President Barack Obama signed an executive order that would require federal contractors to offer their workers up to seven days of paid sick leave per year (80 FR 54697). He also renewed previous calls for Congress to pass legislation to make similar leave available to private sector workers nationwide.

Republicans indicate the executive order and other paid leave mandates pending in Congress will only add another layer of bureaucracy for employers that could drive up costs and force them to cut jobs. Some said they continue to instead support legislation that would allow employers to offer paid time off in lieu of overtime wages.

Rep. John Kline (R-MN), who chairs the Committee on Education and the Workforce, believes a time-off-for-overtime measure would simply give private workers the same flexibility already afforded to federal government workers. He and other Republicans criticized the president for issuing the executive order instead of working through Congress to reach a solution.

Meanwhile, Sen. Patty Murray (D-WA) continues to push legislation that she introduced earlier this year, which would require employers to offer workers up to seven days of annual paid sick leave. If there's a possibility for compromise on the issue, Sen. Angus King (I-ME) and Sen. Deb Fischer (R-NE) have a bill they introduced in the previous Congress that would have offered employers tax incentives in return for making paid sick leave available to their workers. The bill has not been introduced yet in this 114th Congress.

Proposed Overtime Rule Receives Large Response

The U.S. Department of Labor (DOL) received 247,068 public comments about its proposed white-collar overtime rule. Employee advocacy groups and others say the increase would help families and the economy, but many industry groups and other parties say it would cause layoffs and business failures. Click HERE to see HCAOA's comments that were submitted on the proposed rule.

The proposed rule, unveiled June 30, would more than double the salary workers must be paid before they can be considered exempt from the Fair Labor Standards Act (FLSA) requirement that they be paid one and one-half times their normal pay rate for work hours exceeding 40 in a work week. The current threshold for overtime eligibility is $455 a week, or $23,660 per year.

The proposal would set the salary threshold at the 40th percentile of earnings for full-time salaried workers, as determined by DOL's Bureau of Labor Statistics. That amount is projected to be $970 per week, or $50,440 per year, in 2016, when the threshold increase likely would occur. The Obama administration estimated the proposal would make more than five million additional workers eligible for overtime pay.

Judge Allows U.S. House of Representatives to Sue Over Obamacare

On September 9, 2015, a federal judge ruled the U.S. House of Representatives had the right to sue the Obama administration over billions of dollars in health care spending, a decision that poses a new legal threat to the health care law and gave congressional Republicans a victory in their claims of executive overreach by the White House.

U.S. District Court Judge Rosemary M. Collyer found that the House had made a compelling case that suing the White House was the only way to preserve its constitutional power to control federal spending and stop the administration from distributing $136 billion in insurance company subsidies that Republicans say Congress never approved.

The judge dismissed another challenge to the law by the House, finding that the House's claim that the Obama administration had improperly moved the deadlines for new employer requirements without congressional action did not rise to a level that justified a court fight.

Articles of Interest Over the Past Quarter

NLRB Decision Has Broad Implications for Employers

On August 27, 2015, in a 3-2 decision involving Browning-Ferris Industries of California, the National Labor Relations Board (NLRB) refined its standard for determining joint-employer status.

In its decision, the NLRB found that Browning Ferris was a joint employer with Leadpoint, the company that supplied employees to Browning Ferris to perform various work functions for Browning Ferris, including cleaning and sorting of recycled products. In finding that Browning Ferris was a joint employer with Leadpoint, the NLRB relied on indirect and direct control that Browning Ferris possessed over essential terms and conditions of employment of the employees supplied by Leadpoint as well as Browning Ferris' reserved authority to control such terms and conditions.

For the last 30 years, under the NLRB, two separate business entities have been considered "joint employers" if both entities exercise direct and immediate control over the terms and conditions of employment of the same workers. This means that both entities share the ability to hire, fire, discipline, supervise and direct the workers in question. The U.S. Chamber of Commerce declared in a statement that the test announced in Browning Ferris discards this well-established standard in favor of one in which almost any economic or contractual relationship could trigger a finding of joint employer status.

The International Franchise Association (IFA) announced in a statement on the ruling that it has been working with the Coalition to Save Local Businesses (CSLB) to inform Members of Congress about the devastating economic impact of redefining the current joint employer standard would have on franchised businesses and the overall U.S. economy. As part of its involvement with the coalition, IFA will ask Members of Congress to support legislation that would codify the decades-long and widely-accepted definition of what constitutes a joint employer. HCAOA is a member of the CSLB, as well.

U.S. Labor Department and Kentucky Labor Cabinet Sign Agreement to Protect Workers

On July 15, 2015, the U.S. Department of Labor (DOL) and the Kentucky Labor Cabinet signed a three-year Memorandum of Understanding (MOU) with the goal of protecting the rights of employees by preventing their misclassification as independent contractors or other non-employee statuses. Under the agreement, both agencies may share information and coordinate law enforcement.

The MOU represents a new effort on the part of the agencies to work together to protect the rights of employees and level the playing field for responsible employers by reducing the practice of misclassification. Kentucky joins a growing list of states that are now partners in this effort with the U.S. Labor Department. Alabama, California, Colorado, Connecticut, Florida, Hawaii, Illinois, Iowa, Louisiana, Maryland, Massachusetts, Minnesota, Missouri, Montana, New Hampshire, New York, Rhode Island, Texas, Utah, Washington, Wisconsin and Wyoming agencies have signed similar agreements. More information is available on the DOL misclassification website HERE.

Supreme Court Upholds Health Care Law

On June 25, the Supreme Court saved Obamacare from another critical legal challenge, in a 6-3 decision that upholds health insurance subsidies for millions of low and middle-income residents. The ruling avoids a debate in Congress and the White House over how to fix the health care law. The court upheld an IRS rule that allowed the federal government to help pay for individual health insurance in the 34 states that didn't set up their own health care exchanges. Click HERE for more information.

Member News

2015 HCAOA Annual Leadership Conference

Register and Book Your Accommodations in Washington, DC Today!

We are officially two weeks out from the 2015 HCAOA Annual Leadership Conference, set to take place Sept. 27-30 in Washington, DC

Please join us and be a part of a unique opportunity to learn about current home care industry issues, trends and strategies that can help your organization succeed. Your time in Washington, DC is also a unique and valuable opportunity to have your "voice" heard in our Nation's Capital, especially in light of the recent Court of Appeals decision. (see latest in Executive Corner above)

Attendees will learn about the latest home care innovations, business strategies, practices and methods during the three-day event. In addition, the Conference offers participants the opportunity to hear from a variety of home care industry leaders during presentations and breakout sessions on a wide range of topics, including advocacy, operations, care development plans and sales/marketing tactics.

This year's keynote address, "The Role of Home Care in the Health Care Continuum," will be delivered on September 28 by Mr. Tommy G. Thompson, Former Secretary, U.S. Department of Health and Human Services and four-term governor of Wisconsin.

So be sure to book your accommodations by tonight, Friday, September 11, and mention that you are an attendee of the HCAOA Annual Leadership Conference to ensure you receive the discounted rate. This year, the Marriott Wardman Park has given our organization an outstanding guest room rate of $214, plus tax. Reservations can be made by calling (800) 228-9290.

To view the 2015 Annual Leadership Conference Brochure, please click HERE.

HCAOA Invites You to Participate In Our Member Survey

As you know, HCAOA is pursuing four core pillars - advocacy, awareness, research and certification - as part of our organizational strategic plan. Our awareness efforts are aimed at strengthening the positioning of the home care industry and HCAOA with policymakers, the media, the home care market and the general public.

To that end, we need input from you - our valued members - and invite you to participate in our member survey to help us develop a comprehensive picture of perceptions and expectations of the home care industry and HCAOA. Your input contributes to our overall strategy and awareness efforts.

You can access the 15-minute survey HERE. Responses are due Wednesday, September 16. If you experience technical difficulties, please contact Yael Miller at ymiller@highlanterngroup.com.

We appreciate and value your input.

Chapter News

Washington Chapter Annual Conference: Blooming with the Boomers September 15-16

Join the 9th Annual WAHCA Conference Blooming with the Boomers September 15-16, for this year's incredible agenda and achieve the knowledge and tools to help you grow your business in any season and through any storm!

For more information and to register click HERE.

Illinois Private Duty Home Care Symposium

The Illinois Chapter, along with Leading Age Illinois and the Illinois Homecare & Hospice Council are sponsoring the Leading Age Illinois: Private Duty Home Care Symposium. This event will be held on September 17 at DePaul University-Naperville. The topics of discussion will be:

Understanding the employer role of home care agencies
Learn changes in home care regulations
Understanding the latest trends in private duty home care in Illinois

For more information and to register click HERE.

Wisconsin Chapter Sponsors Wisconsin Home Care Update: Town Hall Forum - SAVE THE DATE

Please save the date, Friday, Oct. 9, for the first annual Wisconsin Home Care Update: Town Hall Forum at American Family Insurance headquarters in Madison.

The event will take place from 9:30 a.m. to 12:30 p.m. and will be hosted by the Home Care Association of America - Wisconsin Chapter.

The update will include a panel addressing the following topics: