Nursing Care Facilities/Residential Care Facilities


Nursing Care/Residential Care Facilities Under the Fair Labor Standards Act


This section provides general information concerning the application of the minimum wage and overtime pay requirements of the Fair Labor Standards Act (FLSA) to skilled nursing care facilities, intermediate care facilities, and nursing and personal care facilities. It is designed to provide general information on the requirements of the FLSA and to alert employees to certain employment practices that result in FLSA violations.

Coverage

The FLSA covers all nursing care enterprises, public and private, whether operated for profit or not for profit.

Requirements

Minimum Wage: FLSA covered employers are required to pay all non-exempt employees the Federal minimum wage of $5.15 an hour on their regularly scheduled payday.

Overtime: Employers must also pay all non-exempt employees a rate of time-and-one-half the regular rate of pay for each hour of overtime worked. Nursing care facilities may pay employees overtime after 40 hours in a 7 day workweek or alternatively, use the “8 and 80” system. Under the “8 and 80” system, the nursing care facility may pay employees -- with whom they have a prior agreement -- overtime for any hours worked after more than 8 hours in a day and more than 80 hours in a 14-day period.

Recordkeeping: Employers are required to maintain accurate payroll and time records. Time records must be preserved for two years and payroll records must be kept for three years.

Common Industry Problems

Non-exempt employees must be compensated for any time during which they perform activities that benefit the employer.
The most common violation in the nursing care industry is the failure of employers to pay for all the hours worked. This uncompensated time most frequently occurs when employers fail to pay for work performed:

  • Before and after a worker's scheduled shift;
  • During an employee's scheduled meal period; and
  • While employees are attending staff meetings and compensable training sessions.

Minimum wage and overtime pay violations also occur when employers make deductions or demand reimbursement for the cost of required uniforms or equipment.
Individuals not otherwise employed by the facility who volunteer – without expectation of pay – to attend to the comfort of nursing home residents in a manner not otherwise provided by the facility are not considered employees under the FLSA. However, individuals (including residents) who perform work of any consequential economic benefit to the facility are employees and entitled to FLSA minimum wage and overtime.
Overtime pay violations often occur when employers:

  • Fail to pay overtime after 8 hours of work in a day for workers (both full time and part time) who are under the “8 and 80” system.
  • Pay overtime after 80 hours worked during a biweekly period rather than after 40 hours in a workweek to employees not under the “8 and 80” system.
  • Fail to combine hours worked in more than one department or at more than one facility when determining the total overtime hours worked.
  • Fail to include in calculating overtime hours the time spent or hours worked while performing on-call assignments.
  • Fail to include shift differential, bonuses or on-call fees in calculating an employee's regular rate.
  • Fail to pay overtime to non-exempt, salaried employees (e.g., clerical staff, cooks, and activities directors).


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