Littler “Ask the Experts”: Payroll Audit Independent Determination Program

Through NAHC’s partnership with Littler Mendelson P.C Labor & Employment Law Solutions, we are excited to share the “Ask the Experts” Article. Each week, we will feature a new question, from you our members, related to workplace issues and topics that will be answered from our experts and partners at Littler.

This week’s question comes from our private duty home care advisory board members and concerns the recent announcement about the Department of Labor’s PAID program.

Question: What does it mean that the U.S. Department of Labor (DOL) has ended its Payroll Audit Independent Determination (PAID) program last Friday (January 29, 2021)?

Answer by Will Vail of Littler Mendelson

The PAID program began in March 2018 and allowed employers an alternative method to rectify overtime and minimum wage violations of the federal Fair Labor Standards Act (FLSA) without the worry of an extended statute of limitations, penalties, and threat of private litigation or attorneys’ fees.  The Wage Hour Division repeatedly touted the program’s success (the most recent numbers – from this past summer – show that it collected more than $7 Million in wages for 11,000 workers).  In its press release announcing the end of the program, however, the DOL indicated that the resources and outreach provided by the Wage and Hour Division to employers are sufficient to help employers comply with the FLSA “without relieving them of their legal obligations.”

Under the PAID program, employers were able to self-report a wage violation, submit a calculation of back wages to the DOL, and enter into an agreement to pay 100% of back wages owed over a two-year period. In turn, the DOL would supervise and approve the settlement permitting employees to issue a valid release of the claim, limited to the reported issue. The DOL agreed not to seek a third year of back wages, liquidated damages, or civil money penalties, and kept the identity of reporting employers confidential, subject to FOIA requests. As an additional incentive for employers to participate in the PAID program, the DOL agreed not to investigate the underlying merits of the issue that the employer self-reported; instead, its review was limited to the back wage calculations prepared by the employer for accuracy.

Without the self-reporting PAID program, the only two options available to release FLSA claims are through a court-approved settlement or as a result of a DOL-initiated investigation.  The PAID program did not release any state law claims, which was why some employers did not avail themselves of it, but the program did allow for significant relief for employers to correct issues without the threat of additional litigation or negative publicity.

Even without the added benefits of the PAID program, employers should continue to be proactive to audit pay records and correct potential wage issues if identified.  This is particularly true for the at-home care industry (home health, hospice and home care).  Even under the previous administration, there was substantial litigation against companies in this industry.

Big picture, this likely is an example of the new administration’s stance on employment matters generally.  It is likely going to take a stricter enforcement posture with companies.  Indeed, the new administration has already added more than a dozen new political appointees to the DOL, including in the Solicitor’s office (the part of the DOL that litigates against employers).

Do you have a question for our experts at Littler?

As part of our commitment to you as our members we want to make sure to support you with the information and leadership expertise you need to provide quality private duty home care and services.

If you have a question for our experts at Littler, please feel free to send your question to erb@nahc.org and we will work to get your question answered as quickly as possible and then featured in an upcoming Ask the Experts section of the Private Duty Source.

About Littler

At Littler, we understand that workplace issues can’t wait. With access to more than 1,500 employment attorneys in over 80 offices around the world, our clients don’t have to. We aim to go beyond best practices, creating solutions that help clients navigate a complex business world. With deep experience and resources that are local, everywhere, we are fully focused on your business. With a diverse team of the brightest minds, we foster a culture that celebrates original thinking. And with powerful proprietary technology, we disrupt the status quo – delivering groundbreaking innovation that prepares employers not just for what’s happening today, but for what’s likely to happen tomorrow. For over 75 years, our firm has harnessed these strengths to offer fresh perspectives on each matter we advise, litigate, mediate, and negotiate. Because at Littler, we’re fueled by ingenuity and inspired by you.

About Will Vail, Special Council

William Vail brings a wealth of private practice and in-house experience to every matter he handles. For nearly seven years, he was lead employment counsel two separate divisions of largest post-acute health care provider in the nation (the home health, hospice and community care division and nursing center division). He later was lead employment and litigation counsel for the largest home health and hospice provider in the nation following a corporate reorganization. In addition to a wide variety of employment issues, Will is familiar with False Claims Act, professional liability and general liability matters related to healthcare operations.

Will is a core member of Littler’s healthcare practice group. He has experience litigating across the United States, providing advice and counsel to both legal and non-legal stakeholders, performing due diligence related to mergers and acquisitions, helping start-ups begin operations in a compliant method, winding down operations, conducting management training, and assisting in the integration of new entities into going concerns.

William Vail began his legal career in 2004 as a law clerk to a federal judge sitting in the Western District of Virginia. He then transitioned to private practice in Louisville, Kentucky, for a regional full-service firm and later a national labor and employment boutique firm. At Littler, Will is based in Louisville as well as Atlanta.

*Not licensed to practice law in Georgia

Littler Ask the Experts: Legal Considerations for Employees Working Remotely

Through a partnership with Littler Mendelson P.C Labor & Employment Law Solutions, we are excited to share the “Ask the Experts” article. Each week, we will feature a new question, from you, our members, related to workplace issues and topics that will be answered from our experts and partners at Littler. 

This week’s question comes directly from a recent advisory board meeting and concerns legal considerations and obligations around telework.

Question: What are the legal considerations for employees who are now working remotely? What is our company responsible for paying for related to the work these employees are performing now out of their home offices?  

Answer by Will Vail 

Employers with employees working remotely should strongly consider creating a policy that addresses all of the potential issues the parties may face.  One big issue is whether an employer must reimburse for expenses relating to working from home.  In some states, like California and Illinois, employers are required to reimburse these expenses.  California’s statute is the most restrictive and has served as a model for others.  It requires employers to reimburse “all necessary expenditures or losses incurred by the employee in direct consequence of the discharge of duties or obedience to the employer’s directions.”  Although the law is not entirely settled, only California courts have held that an employer should reimburse a reasonable percent of the expense for things used to perform the work, even if the employee would have incurred the same expense without having used the item for business (i.e., no incremental cost to employee such as existing home internet or use of personal cell phone that is on an unlimited plan).  The Illinois statute permits employers to set certain guidelines and specifications that may limit reimbursement liability.   

Related question: How can I best track time and attendance for remote workforce employees?  

A Telework Policy defines the essential components of remote timekeeping for non-exempt employees: a specific schedule, requirements for clocking in and out, mandatory tracking for required meal and rest breaks, and a prohibition against working off the clock. The Policy also should make clear that the Company’s broader timekeeping and overtime rules apply; these policies can be evaluated and fine-tuned as needed.  The need to define meal and rest period obligations also will vary from state to state. 

Telework also raises challenges related to compensable travel time.  If non-exempt employees can work from a home office and from an employer’s office, the time spent getting from one location to the other in the course of a day might be transformed from a non-compensable home-to-work commute to a compensable trip from one worksite to another. For this reason, employers should consider directing non-exempt employees to work in only one work location each day or, if developing a specific program involving multiple work sites in a day, work directly with wage and hour counsel to develop programs to address potentially compensable travel time.

Before advancing a robust telework policy, employers should ensure that there is appropriate infrastructure for the logistics of accurate timekeeping: If a timekeeping system is used, are adjustments required so it will function properly remotely? If timesheets are used, how will they be returned by remote employees, and reviewed and approved by managers, and how will revisions be verified by the employee when teleworking? Are there reliable methods for cutting off access to work materials outside scheduled working time, to prevent off-the-clock work by non-exempt employees?

Finally, as with all wage and hour topics, robust training for managers supervising non-exempt employees working remotely is strongly recommended. Out of sight does not translate to out of mind.  Managers can be trained to recognize the potential Company perils brought about by remote-working non-exempt employees, in particular such risks that the managers can possibly prevent – e.g., by not sending emails to non-exempt workers after hours, not reducing time on a timesheet without a clear record of the reason and agreement from the employee, and more.

About Littler

At Littler, we understand that workplace issues can’t wait. With access to more than 1,500 employment attorneys in over 80 offices around the world, our clients don’t have to. We aim to go beyond best practices, creating solutions that help clients navigate a complex business world. With deep experience and resources that are local, everywhere, we are fully focused on your business. With a diverse team of the brightest minds, we foster a culture that celebrates original thinking. And with powerful proprietary technology, we disrupt the status quo – delivering groundbreaking innovation that prepares employers not just for what’s happening today, but for what’s likely to happen tomorrow. For over 75 years, our firm has harnessed these strengths to offer fresh perspectives on each matter we advise, litigate, mediate, and negotiate. Because at Littler, we’re fueled by ingenuity and inspired by you.

About Will Vail, Special Council

William Vail brings a wealth of private practice and in-house experience to every matter he handles. For nearly seven years, he was lead employment counsel two separate divisions of largest post-acute health care provider in the nation (the home health, hospice and community care division and nursing center division). He later was lead employment and litigation counsel for the largest home health and hospice provider in the nation following a corporate reorganization. In addition to a wide variety of employment issues, Will is familiar with False Claims Act, professional liability and general liability matters related to healthcare operations. 

Will is a core member of Littler’s healthcare practice group. He has experience litigating across the United States, providing advice and counsel to both legal and non-legal stakeholders, performing due diligence related to mergers and acquisitions, helping start-ups begin operations in a compliant method, winding down operations, conducting management training, and assisting in the integration of new entities into going concerns. 

William Vail began his legal career in 2004 as a law clerk to a federal judge sitting in the Western District of Virginia. He then transitioned to private practice in Louisville, Kentucky, for a regional full-service firm and later a national labor and employment boutique firm. At Littler, Will is based in Louisville as well as Atlanta. 

*Not licensed to practice law in Georgia

“Littler: Ask the Experts”

Through Private Duty Home Care at NAHC’s partnership with Littler Mendelson P.C Labor & Employment Law Solutions, we are excited to share the “Ask the Experts” Article. Each week, we will feature a new question, from you our members, related to workplace issues and topics that will be answered from our experts and partners at Littler. 

This week’s question comes from one of our Private Duty Home Care members and concerns pay for travel time to assignments.

Question: I just started my own agency and one of my employees, a home care aide, is asking if she is entitled to additional pay for the time it takes her to drive to her client’s homes. Is this something I am required to pay?

Answer by Angelo Spinola

Different states have different rules for travel time, but generally speaking work related travel between client homes within a single day of work must be paid under federal and state law.  Under federal law, the Portal-to-Portal Act eliminates “from working time certain travel and walking time and other similar ‘preliminary’ and ‘postliminary’ activities performed ‘prior’ or  ‘subsequent’  to  the  ‘workday’  that  are  not  made  compensable  by  contract,  custom,  or practice.”  29 C.F.R. § 785.9.  Thus, employers do not typically have to compensate employees under the following two situations: (1) normal home-to-work and work-to-home travel; and (2) other activities considered preliminary and postliminary to an employee’s principal job activities. Id.   As such, home to work, or work to home travel, is not compensable in an ordinary situation. 

 Under federal law, assuming an employee has engaged in no work activities prior to the start of travel, employers generally do not have to count as time worked the time an employee spends “walking, riding, or traveling to and from the actual place of performance of the principal activity or activities, which such employee is employed to perform” either at the beginning or end of the workday.  29 C.F.R. § 785.34.  However, travel time from job site to job site during the course of the work day is considered work time. 29 C.F.R. § 785.38. The United States Department of Labor has advised that, where the travel is not direct from job site to job site, such that the employee is relieved from duty for a period sufficient to engage in purely personal pursuits, only the time necessary to travel directly from the first job site to the second job site is considered compensable travel time.  See United States Department of Labor, Wage and Hour Division, Domestic Service Final Rule Frequently Asked Questions (FAQ), http://www.dol.gov/whd/homecare/faq.htm.  The U.S. DOL’s FAQ materials provide the following example:

Tiffany is a direct care worker who is employed by Handy Home Care Agency. She provides services to two of the agency’s clients, Mr. Jackson, from 9:00am to 11:30am, and Mr. Smith, from 2:00pm to 6:00pm. Tiffany drives to the two different worksites which are 30 minutes apart. She leaves Mr. Jackson’s home at 11:30am and goes to a restaurant for lunch, shops for herself, and then arrives at Mr. Smith’s home at 2:00pm.

Because Tiffany is completely relieved from duty long enough to use the time effectively for her own purposes (i.e., lunch and shopping) not all of the time is hours worked. The 30 minutes required to travel between the two homes is hours worked and, as of January 1, 2015, must be paid by the Handy Home Care Agency even though Tiffany did not travel directly between consumers.

About Littler

At Littler, we understand that workplace issues can’t wait. With access to more than 1,500 employment attorneys in over 80 offices around the world, our clients don’t have to. We aim to go beyond best practices, creating solutions that help clients navigate a complex business world. With deep experience and resources that are local, everywhere, we are fully focused on your business. With a diverse team of the brightest minds, we foster a culture that celebrates original thinking. And with powerful proprietary technology, we disrupt the status quo – delivering groundbreaking innovation that prepares employers not just for what’s happening today, but for what’s likely to happen tomorrow. For over 75 years, our firm has harnessed these strengths to offer fresh perspectives on each matter we advise, litigate, mediate, and negotiate. Because at Littler, we’re fueled by ingenuity and inspired by you.

Angelo Spinola is a Shareholder with Littler Mendelson P.C., and is a lead attorney for the Home Care Practice Group. He represents home care employers across the country in various types of actions brought under the Fair Labor Standards Act and various state wage and hour laws. Appearing on behalf of employers in federal and state courts and administrative tribunals throughout the U.S., Angelo has litigated all types of discrimination cases, including age, disability, race, national origin, sex, harassment and retaliation. Angelo’s experience also includes helping employers respond to wage and hour investigations by the Department of Labor and state agency equivalents, conducting wage and hour practices audits, developing compliance measures that minimize wage and hour exposure, and representing management in grievance arbitrations. Additionally, Angelo assists employers with promoting an issue-free work environment through counseling, training and other preventive strategies. He also conducts training on employment-related issues for management personnel, lawyers and human resources professionals. Angelo received a J.D. from George Washington University Law School.

“Littler Ask the Experts”

Through a partnership with Littler Mendelson P.C Labor & Employment Law Solutions, we are excited to share the “Ask the Experts” Article. Each week, we will feature a new question, from you our members, related to workplace issues and topics that will be answered from our experts and partners at Littler. 

This week’s question comes from one of our Private Duty Home Care members and concerns keeping caregivers and clients safe during the public health emergency.

Question: “I provide services in a state that has a mask mandate for people when they are not able to maintain social distance (six feet or more). We have tried to enforce this with our clients and family members, asking them to wear masks when our caregivers are in the home, but many of the clients are not following this guidance.  Can I ask them to sign something like a waiver? Should I? What if one of my caregivers gets sick or is impacted by COVID because a client doesn’t want to wear a mask?”

Answer by Will Vail 

Great questions.  Your caregivers should be wearing at least cloth face coverings whenever they are in a client’s home regardless of whether or not the client or anyone else in the client’s home is wearing a cloth face covering or face mask.  Putting aside state mandates, you are right that it is a best practice to have the client also wear at least a cloth face covering when the caregiver is present in the home.  If both parties wear a mask, the chance of transmission is substantially reduced.

Even if there is a mask mandate in your state, there likely are exceptions for people who cannot wear them for medical reasons.  And there will be some clients who cannot wear them because of this.  In those situations, you may want to ask your caregiver to wear an N-95 respirator (assuming you have a respiratory program in place).  If that is not an option, then you should advise your caregiver of the risks associated with caring for the client who cannot wear a mask and allow the caregiver to opt out of the service.  This may result in you having to discharge the client, but that might be the best business decision for you given the alternative of “forcing” a caregiver to work in the home.  If you were to require a caregiver to work in the home, then you could expose yourself to both litigation risk as well as reputational risk from the caregiving community (you probably would no longer be an employer of choice in this industry).

To your question about waivers, there is no full waiver you could have your caregiver sign that would protect you.  Employees have a right to file a workers’ compensation claim if they believe they contracted COVID-19 at work.  Littler’s Home Care Industry COVID-19 Response Package includes a waiver that you could have your caregiver sign where the caregiver would agree only to go the workers’ compensation route (i.e., not sue you for intentionally exposing the caregiver to COVID-19) in exchange for you promising not to contest the workers’ compensation claim.  If you did not have your caregiver sign such a waiver, then your best defense likely would be to show that the caregiver did not contract it from the client, which of course will depend on the various facts and circumstances. 

If the client or those who live in the client’s home refuse to wear at least a cloth face covering, and there is no valid underlying medical reason, then you should review your state’s mask mandate to see if there is possibly an exception that would allow this.  If there is no exception, then you could bring that to your client’s attention.  In doing so, you could ask the client to indemnify you in the event your caregiver were to contract COVID-19 and make a claim against you.  If the client refuses, you would have to make a business decision as to whether to continue to provide services.  But even if the client signs the indemnification provision, you should advise your caregivers of the situation (just as in the situation where the client has a medical reason preventing him or her from wearing a mask) and ask whether the caregiver would like to continue servicing the client.  If you have no willing caregivers, you may have to terminate service (or at least go through the analysis discussed above).

About Littler

At Littler, we understand that workplace issues can’t wait. With access to more than 1,500 employment attorneys in over 80 offices around the world, our clients don’t have to. We aim to go beyond best practices, creating solutions that help clients navigate a complex business world. With deep experience and resources that are local, everywhere, we are fully focused on your business. With a diverse team of the brightest minds, we foster a culture that celebrates original thinking. And with powerful proprietary technology, we disrupt the status quo – delivering groundbreaking innovation that prepares employers not just for what’s happening today, but for what’s likely to happen tomorrow. For over 75 years, our firm has harnessed these strengths to offer fresh perspectives on each matter we advise, litigate, mediate, and negotiate. Because at Littler, we’re fueled by ingenuity and inspired by you.

About Will Vail, Special Council

William Vail brings a wealth of private practice and in-house experience to every matter he handles. For nearly seven years, he was lead employment counsel two separate divisions of largest post-acute health care provider in the nation (the home health, hospice and community care division and nursing center division). He later was lead employment and litigation counsel for the largest home health and hospice provider in the nation following a corporate reorganization. In addition to a wide variety of employment issues, Will is familiar with False Claims Act, professional liability and general liability matters related to healthcare operations. 

Will is a core member of Littler’s healthcare practice group. He has experience litigating across the United States, providing advice and counsel to both legal and non-legal stakeholders, performing due diligence related to mergers and acquisitions, helping start-ups begin operations in a compliant method, winding down operations, conducting management training, and assisting in the integration of new entities into going concerns. 

William Vail began his legal career in 2004 as a law clerk to a federal judge sitting in the Western District of Virginia. He then transitioned to private practice in Louisville, Kentucky, for a regional full-service firm and later a national labor and employment boutique firm. At Littler, Will is based in Louisville as well as Atlanta. 

*Not licensed to practice law in Georgia