Obama’s promise to raise wages for home care workers is in jeopardy

January 9, 2015, 6:20 PM UTC
Obama speaks about wages for in-home care workers in Washington
U.S. President Barack Obama makes a statement in Washington on new minimum wage/overtime protections for in-home care workers December 15, 2011. REUTERS/Kevin Lamarque (UNITED STATES - Tags: BUSINESS EMPLOYMENT) - RTR2VAAV
Photograph by Kevin Lamarque — Reuters

In 2011, President Barack Obama promised to raise the wages of home care workers, a chronically underpaid and poverty-stricken profession. But a legal challenge and a recent court decision have delayed that guarantee and put its fate in question.

On Friday, federal district court Judge Richard Leon in Washington, D.C. will consider whether to further put off wage increases for those home health aides.

In September 2013, the federal Department of Labor issued official rules that removed a longtime Fair Labor Standards Act exemption that had allowed third-party employers of home care workers to not pay the minimum wage or overtime to employees who provided so-called companionship services to the disabled and elderly.

Since 1974, all “companionship service” workers who provide fellowship, care, and protection in a client’s home had not been protected by the federal minimum wage and overtime laws. The rule the Labor Department released in 2013 eliminated that exemption for home aide staffing agencies, which employ nearly 1.9 million people nationwide, but kept it in place for workers employed directly by clients or their families.

The new rules marked a huge victory for worker advocates, who had championed higher pay and long argued that home care aides shouldn’t be grouped together with teenage babysitters.

Meanwhile, home care worker agencies were outraged. They sued the Labor Department in June, arguing that being forced to pay workers higher wages would destabilize the home care industry and make it harder for families to pay for the care of aging or disabled relatives.

So far, the industry groups—the Home Care Association of America, International Franchise Association, and the National Association for Home Care and Hospice—have successfully fought off the new requirements, with the biggest blow coming late last month, when Judge Leon gutted the part of the new rule that eliminated the companionship exemption for third-party employers. Leon ruled that the Department of Labor didn’t have the authority to dictate what types of employers were subject to the exemption and that such changes should be made legislatively. The Department’s rule “essentially eviscerates a Congressionally-mandated exemption via a method Congress never envisioned,” the judge wrote.

About a week after that ruling, Judge Leon put the implementation of the rules on hold until January 15, as he considered another part of the industry groups’ case: their challenge to the new definition of companionship care, which was narrowed by the Labor Department’s new rules.

On Friday, Leon will hear that aspect of the case and will decide whether to delay the implementation of the rules even further. Leon has noted that the public “deserves speedy resolution of an issue of widespread impact.” (Indeed, home care workers who thought they were getting a raise in 2015 because of the new rules will not see any more pay.)

In arguments on Friday, industry groups and the government will not just debate legal technicalities. They will also debate what’s best for the nation’s rapidly aging population—lower pay for in-home aides to ensure easy access to care, or higher aide pay to attract skilled and devoted caregivers.

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