There are more and more people living well into their 80’s and 90’s. Therefore more people are or will be taking care of elderly parents, including ensuring that they receive proper care and attention at all times. Given a choice, most elderly relatives prefer to remain in their homes instead of moving to an assisted living or skilled nursing facility. This natural desire can be accommodated by hiring a caregiver. Many caregivers can provide the care needed in exchange for room, board and a small salary. However, these arrangements can result in substantial exposure for claims based on unpaid overtime, liquidated damages and various penalties. It is therefore imperative that hiring a caregiver be done carefully and properly.
We know what we are talking about in this regard; even a claim based on a relatively small amount of time and small salary can lead to an overtime claim worth tens of thousands of dollars, as happened in a recent case we settled.
When one hires a person to work in one’s home or one’s parent’s home, one is creating an employer-employee relationship. This cannot be avoided by paying them a salary, or even “agreeing in writing” that the caregiver is an “independent contractor.” The employment relationship is not governed by the labels or the pay, but by the nature of the work. Caregivers and personal attendants must be paid by the hour. This in turn means that the “employer” (you and your parent, who will likely be considered “joint employers”) must pay a “premium” for “overtime.” The employer must keep records of the employee’s hours worked, set up a payroll system and obtain workers’ compensation insurance. While this sounds daunting, in reality it can be accomplished through a payroll service at a nominal price.
It is easier to ensure compliance with employment laws relating to wages by contracting with an agency that employs caregivers. This, however, costs more money. In addition, the agency will likely charge you for every hour the caregiver is at your home, even if he or she is not “working.” This kind of arrangement may be a good short term solution but for many people is not financially sustainable for a long period of time, depending on the level of care needed.
There are special rules for “personal attendants” that exempt them from some overtime requirements. Click here to see Wage Order 15.2.(J). Unlike other types of caregivers, personal attendants are not paid overtime unless they work more than 45 hours per week. They are not paid “double time” for working more than 12 hours in a day. If they work no more than 45 hours per week, they need not be paid time and a half for working more than 8 hours in a day. However, before you rush off and deem your caregiver to be a “personal attendant” you must ensure that they meet the definition set forth in Labor Code Section 1451.
If your elderly parent or relative mostly needs someone to supervise, feed, or help them dress then employing a personal attendant may satisfy their needs without breaking the bank. In any event, before hiring any sort of caregiver, you should consult an employment attorney. The money you spend on advice and preparation of contracts will be well spent, considering what you could spend defending yourself if you are not careful.
