FLSA and Consumers’ Obligations

The Fair Labor Standards Act (FLSA) has been in place for a six months, effective today. We still do not know a lot about what its impact on CDPA will be. But, it is worthwhile looking at what we do know and examining the obligations the rule puts not just on fiscal intermediaries, but on consumers too.

The changes to FLSA have placed new burdens on many workers and consumers. We know workers have had their hours cut, or have seen their wages cut so that overtime means they earn the same paycheck as before the changes took place. We know many workers have been forced to leave their position because of a cut in wages as they work less hours. We know that funding to pay for the changes has been insufficient to actually address the problem.

What we have also heard is that many consumers are attempting to address this by splitting their workers hours between multiple fiscal intermediaries. CDPAANYS strongly urges consumers NOT to take this step, as it puts you, the consumer, in danger of committing criminal penalties that have extremely serious consequences.

As a consumer in CDPA, you are an employer. In many instances, the fiscal intermediary is the worker’s joint employer. This is a term the Department of Labor and courts have developed to mean that two different entities control the working conditions of an employee. In a joint employer relationship, both employers are responsible for making sure that FLSA requirements are met.

If you use more than one fiscal intermediary, it might be that the personal assistant does not work more than 40 hours with either fiscal intermediary. However, if that personal assistant works over 40 hours in the week, you, as a joint employer for both fiscal intermediaries, owe overtime to that worker. If you do not make sure the worker receives overtime payments, you could be responsible for theft of wages, wage fraud, Medicaid fraud, or more. It’s not worth it, and it won’t help.

We all are working through the changes to the Fair Labor Standards Act and trying to figure out way to make the program continue to work for us in this new environment. CDPAANYS will continue our advocacy to strengthen the program and ensure adequate funding. You can help by joining us and helping advocate for real change that will work.

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