Residential healthcare workers often provide around-the-clock assistance with essential daily living tasks for some of our most vulnerable people. Theirs, however, is an industry where employers’ errant pay practices too often place these caregivers among our nation’s most vulnerable wage earners, as a recent US Department of Labor investigation of a Lansing employer’s pay practices has found. Investigators with the department’s Wage and Hour Division found Gracious Adult Foster Care misclassified its residential healthcare providers as independent contractors, and by doing so, paid them a fixed monthly salary for all hours worked. The action denied seven workers at the employer’s two Lansing locations their full overtime wages, in violation of the Fair Labor Standards Act. The division’s investigation led to the recovery of $94,706 for the affected workers. In addition to shorting workers’ wages, misclassifying employees as independent contractors deprives them of other important employee protections such as unemployment insurance and worker’s compensation. It also makes workers fully responsible for paying Social Security and tax withholdings. From 2019 to 2021, Wage and Hour Division investigations recovered more than $22.7 million for Midwest healthcare workers as a result of violations of worker protections under the Fair Labor Standards Act.
