Home Health & Hospice Week

Celebrate the good news by checking your policies now.

Fail to follow the Fair Labor Standard Act's companionship exemption rules carefully and your missteps could cost you big.

To stave off costly legal action and make sure policies will stand up to scrutiny, consider these 3 tips:

1. Study your state's requirements. The minimum wage and overtime requirements of state laws and regulations may exceed the FLSA requirements, cautions Elizabeth Zink-Pearson, attorney with Pearson & Bernard in Covington, KY.

Keep in mind that states are updating their legal requirements at an unusually quick pace.

"Requirements can change overnight, literally," stresses John Gilliland II of Gilliland Markette Milligan in Indianapolis.

Consider seeking legal counsel to help you sort out the fine points of state requirements, suggests Pearson. Regulations can be difficult to find and decipher, she says.

2. Follow rules to the letter. Under the FLSA rule, the services furnished by the aide must constitute companionship services, Gilliland explains. Regulations define those as 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. The services may include household work related to the care of the aged or infirm person such as meal preparation, bed making, washing of clothes, and other similar services.

Vital: And you'll need to be able to show that household work was limited to no more than 20 percent.

Compliance tip: Don't define "home" too broadly. "The companionship exemption applies only when the services are provided in a client's home," counsels Pearson. Settings that are definitely out include hospitals and nursing homes. Assisted living facilities are also unlikely to be accepted by the Department of Labor as "home," though the agency has agreed to review such claims on a case-by-case basis.

3. Know if your agency is exempt altogether. Smaller agencies may not need to concern themselves with the FLSA at all, reminds Gilliland in an article on the topic. Generally, an agency is subject to the FLSA if it grosses more than $500,000 per year, is a part of a hospital or nursing home, or is part of a public entity, says Gilliland.

Caution: Agencies that are not subject to the FLSA may need to comply with a similar state law.