Acosta v. At Home Pers. Care Servs. LLC
| Decision Date | 15 April 2019 |
| Docket Number | 1:18-cv-549 (LMB/IDD) |
| Court | U.S. District Court — Eastern District of Virginia |
| Parties | R. ALEXANDER ACOSTA, Secretary of Labor, Plaintiff, v. AT HOME PERSONAL CARE SERVICES LLC, et al., Defendants. |
R. Alexander Acosta, the Secretary of Labor ("plaintiff" or the "Secretary"), brings this civil action under the Fair Labor Standards Act ("FLSA" or the "Act") against At Home Personal Care Services LLC ("AHPC") and its owner, Robin Wright ("Wright"). AHPC provides in-home personal care services for individuals enrolled in Medicare and/or Medicaid. The Secretary claims that AHPC and Wright (together, "defendants") violated the FLSA by failing to pay time-and-a-half overtime compensation to 44 personal care aides ("PCAs" or "aides")1 listed in Schedule A, which is attached to the Secretary's complaint, and by failing to maintain accurate employee workweek records. The Secretary seeks back pay, liquidated damages, and an injunction barring defendants from violating the Act in the future. In response, defendants argue that at least some of the workers in question were independent contractors during the relevant time period and thus were not "employees" covered by the FLSA's overtime provisions; that Wright is not liable as an "employer" under the Act; that AHPC maintained adequaterecords; that the Secretary's back pay calculations are excessive; and that it would be inappropriate to award liquidated damages or injunctive relief.
A two-day bench trial was held in March 2019.2 For the reasons stated below, judgment will be entered in favor of the Secretary, and defendants will be held jointly and severally liable for back pay and liquidated damages in a total amount of $128,445.80.
This litigation stems from a dramatic shift in the treatment of third-party providers of home care services like AHPC. In 1974, Congress amended the FLSA to cover domestic service employees, see Fair Labor Standards Amendments of 1974, Pub. L. No. 93-259, § 7(a), 88 Stat. 55, 62 (codified at 29 U.S.C. § 202(a)), but exempted from the Act's overtime compensation requirements "any employee employed in domestic service employment to provide companionship services for individuals who (because of age or infirmity) are unable to care for themselves," id. § 7(b)(3) (codified at 29 U.S.C. § 213(a)(15)). Congress expressly delegated to the Department of Labor ("DOL") the responsibility for defining the terms relevant to that exemption, see 29 U.S.C. § 213(a)(15), and the DOL did so the following year, defining "domestic service employment" as "services of a household nature performed by an employee inor about a private home," Application of the Fair Labor Standards Act to Domestic Service, 40 Fed. Reg. 7404, 7405 (Feb. 20, 1975) (codified at 29 C.F.R. § 552.3). The DOL also defined "companionship services" as "those services which provide fellowship, care, and protection for a person who, because of advanced age or physical or mental infirmity, cannot care for his or her own needs," id. (). Importantly, the 1975 regulations stated that "[e]mployees who are engaged in providing companionship services . . . and who are employed by an employer or agency other than the family or household using their services . . . are exempt from the Act's minimum wage and overtime pay requirements," id. at 7407 (codified at C.F.R. § 552.109(a) (amended 2013)). Under the 1975 regulations, third-party employers like AHPC were exempt from the FLSA's overtime compensation provision.
In 2013, the DOL substantially amended the governing regulations. Application of the Fair Labor Standards Act to Domestic Service, 78 Fed. Reg. 60,454 (codified at 29 C.F.R. pt. 552). Those amendments, which became effective on January 1, 2015, see id. at 60,455, were consequential for companies like AHPC for multiple reasons. They restricted the definition of "companionship services," making clear that the term "does not include the performance of medically related services" and instead applies only to "the activities of daily living (such as dressing, grooming, feeding, bathing, toileting, and transferring)," id. at 60,557 (codified at 29 C.F.R. § 552.6). More significantly, they reversed course and provided that "[t]hird party employers of employees engaged in companionship services . . . may not avail themselves of the . . . [§ 213(a)(15)] exemption . . . , even if the employee is jointly employed by the individual or member of the family or household using the services," id. (codified at 29 C.F.R. § 552.109(a)) (emphasis added). The DOL explained that because structural changes in the home care industry had expanded the number of large, professionalized companies claiming thecompanionship services exemption, it was necessary to adjust the regulations "[t]o better ensure that the domestic service employees to whom Congress intended to extend FLSA protections in fact enjoy those protections." Id. at 60,455; see also id. at 60,460 (); id. at 60,481-83 ().3
The DOL's decision to withdraw from third-party employers such as AHPC the ability to claim the companionship services exemption is relevant both for understanding defendants' actions giving rise to this litigation and in assessing whether the PCAs at issue are "employees" subject to the FLSA's requirements.
AHPC is a limited liability company organized under Virginia law with a principal place of business in Manassas, Virginia. During the period relevant to this litigation—which the parties stipulate runs from January 26, 2016 through October 1, 2017—AHPC was an enterprise whose employees were engaged in commerce and which had an annual gross volume of business of at least $500,000. See Order [Dkt. No. 71] 1 n.1.
AHPC provides in-home healthcare and personal care services to individuals enrolled in Medicare and/or Medicaid. When an eligible patient signs up with AHPC, the company develops a plan of care and schedule for providing the services to which the patient is entitled. The PCAs at issue in this litigation—who account for roughly 40% of AHPC's revenues—provide a variety of services, including bathing, dressing, grooming, light cleaning, cooking, feeding, accompanying patients on errands, and otherwise assisting patients with day-to-day activities. Although the work they perform requires a high degree of attention, care, and discretion, PCAs are generally considered low-skilled workers and are typically paid at a rate between $9 and $11 per hour.
How PCAs come to AHPC and receive assignments can vary significantly. Some apply to AHPC as individuals, hoping that the company will match them with patients. These PCAs do not have preexisting relationships with the patients they serve and often work for multiple patients during their tenure, sometimes attending to more than one patient during a given week. When a patient passes away, loses his entitlement to personal care, or otherwise stops needing personal care services, AHPC attempts to reassign the aide to a new patient with a plan of care and schedule that fits the aide's scheduling needs. Other PCAs apply to AHPC based on preexisting relationships they have with Medicare- or Medicaid-eligible patients. Some of the aides come to AHPC from another third-party provider of home services, and some of these aides bring their patients along with them. PCAs may even be family members or close friends of the patients they serve and may have no interest in caring for anyone else. Indeed, several of the PCAs in this case provided services only for family members, had no prior history of working as PCAs, and will cease working in that capacity when their services are no longer required by their family members.
Regardless of these differences, all of AHPC's PCAs are subject to the same set of policies and practices. Each is given a copy of the AHPC employee manual, see PLEX 11,4 andasked to fill out a signed verification that she has reviewed its contents. Before they can be assigned to work for any patients, PCAs must undergo an orientation and training program designed to familiarize them with common challenges and best practices for providing in-home care services and must complete monthly online continuing education programs offered through AHPC's workers' compensation policy, which covers all of the PCAs. The same timekeeping procedure applies to all PCAs. Under this procedure, PCAs virtually clock in and out when they arrive at or leave a patient's home,5 and each Monday, they are responsible for dropping off with AHPC's human resources department "provider aide records"—which throughout this litigation were referred to as "timesheets"6—indicating the number of hours and tasks performed for each patient on a day-by-day basis. See, e.g., PLEX 24. Failure to submit provider aide records in a timely fashion can lead to disciplinary action. See, e.g., PLEX 19.
AHPC processes payroll and billing as follows. Each day, the company's human resources department monitors the Kinnser data to ensure that all PCAs have reported for theirassignments. If an aide forgets to clock in or out through Kinnser, she is contacted to make sure she is following the appropriate schedule. On a weekly basis, human resources staff collects the PCAs' provider aide records, works to correct any apparent issues with those records,7 and combines the hours worked by each PCA in each week into a single, consolidated spreadsheet known as a "worksheet summary." See PLEX 2. What complicates the recordkeeping in this case is that the provider aide records are placed in each patient's individual files, as required by Medicare and Medicaid regulations. AHPC does not keep separate copies of the records arranged by aide. The...
To continue reading
Request your trial