Appellate Division Second Department Declines to Defer to NYSDOL Opinion Letter and Rules That Home Healthcare Attendants May Be Entitled to Wages for Hours Worked in Excess of 13 Hours a Day

In New York, State Department of Labor (“DOL”) regulations provide that the minimum wage must be paid for each hour an employee is “required to be available for work at a place prescribed by the employer.” (12 NYCRR § 142-2.1(b)) (“Wage Order”). Exception is made for a “residential employee,” defined as one who lives on the premises of the employer, during his or her sleeping hours or any time he or she is free to leave the place of employment. Id.

On March 1, 2010, the DOL issued an Opinion Letter advising that sleep-in employees, whether or not they are residential employees, who work a twenty-four hour shift must be paid not less than for thirteen hours for a twenty-four hour period provided they are afforded at least eight hours for sleep, actually received at least five hours of uninterrupted sleep and are afforded at least three hours for meals. (NYS St. Dept. of Labor OP. No-09-0169 at 4 (March 11, 2010)). The Opinion Letter was a reiteration of the DOL’s long standing interpretation of the Wage Order as applied to home health care attendants, and agencies assigning attendants to twenty-four hour shifts have long followed it in paying the attendants for this shift.

In recent decisions, New York appellate courts have declined to defer to the DOL’s Opinion Letter because, according to those Courts, the letter conflicts with the plain language of the Wage Order. The Appellate Division First Department was the first to so rule in Tokhtaman v. Human Care LLC, 149 A.D. 3d 476 (1st Dept. 2017). Then, last week, the Appellate Division Second Department in Andryeyeva, on behalf of herself and all others similarly situated v. New York Home Attendant Agency, __ A.D. ___ (2nd Dept. 2017) and Moreno v. Future Care Health Services, Inc., ___ A.D. ___ (2nd Dept. 2017), adopted the First Department’s ruling.

The plaintiffs in Andryeyeva and Moreno were home health care attendants employed by the defendants to care for the elderly and disabled clients. They were assigned to twenty-four hour shifts in the client residents’ homes but claimed that they did not “live in” the homes. In Andryeyeva, they were paid an hourly rate for 12 hours of the shift and a flat rate for the 12 night hours. In Moreno, they were paid a flat fee for the entire shift. Plaintiffs in both cases argued that under the Wage Order they were entitled to the minimum wage for all twenty-four hours of the shifts. Defendants argued that plaintiff attendants were paid in accordance with the DOL Opinion Letter.

In Andryeyeva the Second Department acknowledged that it was required to uphold the DOL’s interpretation of the Wage Order as set forth in the Opinion Letter if it was not irrational or unreasonable. However, the court ruled that the DOL’s interpretation was neither rational nor reasonable because it conflicted with the plain language of the Wage Order. The court found that the plaintiffs were required to be at the client residences for the shift and were required to perform services if called upon. In reaching this decision the Second Department relied on the First Department’s decision in Tokhtaman, supra. The court also found that the plaintiffs met the prerequisites to class certification, thus allowing a class of over 1,000 attendants to proceed. The court in Moreno arrived at the same conclusion, noting that the DOL Opinion Letter conflicted with the plain language of the Wage Order because it failed to distinguish between “residential” and non-residential employees.

The state, trial and appellate court decisions in Andryeyeva, Moreno and Tokhtaman stand in contrast to the decisions in the United States District Courts for the Southern and Eastern Districts of New York, Severin v. Project OHR and Bonn-Wittingham v. Project OHR, which gave deference to the DOL’s interpretation of the Wage Order as set forth in the Opinion Letter and held that home health aides need only be paid for 13 hours of a 24-hour shift based on the 2010 DOL opinion letter.

The decisions in Andryeyeva and Moreno may be appealed to New York’s highest court, the Court of Appeals. If upheld there, the decisions present a serious challenge to the home health care industry. By declining to embrace the DOL’s opinion letter, the courts are opening the door to significant wage claims by New York’s tens of thousands of home health care attendants. Combined with the six-year statute of limitations on such claims in New York, this may lead to substantial back pay liability for the employing agencies, which could lead to a restructuring of those agencies and the services they provide.

What To Do

Home healthcare providers must pay close attention to all developments on this issue.

The Andryeyeva and Moreno cases may well be appealed, however, that process will likely take some time and there is no guarantee of a favorable outcome.

Given the potential adverse financial impact of the ruling on the home care industry as a whole, industry groups are likely to seek regulatory and/or economic relief from the New York State Departments of Labor and Health, and revisions to reimbursement rates for the 24 hour shifts.