Last week, the Department of Labor's Wage and Hour Division announced its finalization of regulations extending coverage under the Fair Labor Standards Act to nearly two million workers in the home care industry. For decades, these workers were considered exempt under a provision of the FLSA applying to certain companionship services. Last year, DOL proposed a new interpretation of this exemption, limiting its exclusion to family members and similar caregivers. Any worker employed by a third-party business who provides home care services to elderly, disabled or other persons will be covered under the new rules, regardless of the nature of their specific duties.

The new rules will not take effect until January 1, 2015 in order to avoid disruption to home care businesses and their clients. They will undoubtedly generate lawsuits from the home care industry, which contends that the regulations ignore the language and intent of the statutory exemption. Increased wages would raise income for generally low-paid home care workers, but could affect the cost of such home care services, and reduce the number of employees or their working hours.