Wednesday, December 4, 2013
In my travels, I often talk with families struggling to care for aging loved ones in the parents' home. One frequent topic is how challenging it can be, especially in certain parts of the country, to find reliable home care workers, especially if no adult child lives close enough to supervise.
Recently, one family described to me an additional complication, what to do when the best home care workers insist on being paid in cash, under the table. Here's the setting:
"When my father began to need more care than my mother could provide on her own, and more than I could provide by driving up for long weekends, we tried local agencies. We had almost constant problems with untrained workers and frequent turnover. I decided to try to hire someone directly, realizing that part of the problem was the low rates paid to the employees by the agencies, usually less than half of what we were paying the agency. In some instances the individual was making just over minimum wage, and often the agency refused to pay overtime, because our state law exempts home care workers from certain threshold Labor rules. When I started looking, I discovered that the agencies were advertising on Craig's List too, and I realized the agencies were finding it hard to get reliable workers. We were competing for the same workers.
Finally, I talked to a local Veterans office, who suggested that sometimes informal teams form, almost as spin-offs from an agency, and will work directly for the family. The team members are used to working together, and would cooperate with each other to meet our growing needs for around-the-clock care. They charge less than the agencies, but their take-home pay is higher.
I finally found this kind of local team, two mature women who would work on a shift system, coordinating with each other to provide reliable care. But there was one big problem. They refuse to sign a contract, work for an agency, or have any record of their care, and they won't work for our family if we insisted on withholding for taxes or Social Security. After weeks of problems with agencies, we were desperate, and they knew it. Even though Dad qualifies for VA aide & attendance, we cannot get reimbursed without proper records. The irony is these two woman are providing the best care we've had to date for my parents, and they are reliable. But they are insisting on cash. Frankly, they have us over a barrel, at least for the current emergency."
As depicted on the U.S. Department of Labor website, state laws vary on whether in-home care workers are covered by minimum wage and overtimes rules. The catch-22 is that in many instances, paying higher rates would make home-care unaffordable for families. However, low pay and no benefits are often analyzed, if not addressed, as issues of fairness for the worker, rather than the employer.
Unreported income is, of course, a long-standing issue for taxing authorities, usually discussed in the context of hiring a nanny, house-cleaner, or gardener. Is under-the-table pay for home care workers a trend in your area of the country? Feel free to send us links to emerging legal research on this topic.