A federal judge in Pennsylvania has struck down part of a U.S. Department of Labor rule that required certain employers of live-in domestic service workers — including home health firms — to comply with federal overtime and minimum-wage requirements. Judge W. Scott Hardy, writing on Thursday, October 29 for the U.S. District Court for the Western District of Pennsylvania, held that the Labor Department exceeded its authority with the rule, Bloomberg Tax reported on Friday.
Source: Bloomberg Tax
What the judge actually decided — a split ruling
This was a partial win for the home-care companies, not a wholesale wipeout of the rule. Law360's account of the same ruling puts the split precisely: the Labor Department exceeded its authority by barring third-party employers of live-in domestic workers from claiming a federal overtime exemption, Judge Hardy ruled — but he kept in place a similar restriction for companionship workers. In other words, the exemption bar falls for live-in workers employed through agencies, while the corresponding bar for companionship services survives, at least at this district-court stage.
Source: Law360 Employment Authority
The plaintiffs are Intra-National Home Care LLC and Agewell Home Helpers Inc., companies that, in Bloomberg Tax's description, employ home health care workers or handle payroll for them. On the live-in question, the court held that those firms are exempt from certain provisions of the Fair Labor Standards Act — the federal law that sets minimum-wage and overtime rules for most American workers, but that has long carried specific exemptions for domestic service.
Source: Bloomberg Tax
Judge Hardy relied on the Supreme Court's 2024 decision in Loper Bright Enterprises v. Raimondo, the landmark ruling that directed lower courts to decide for themselves whether an agency has acted within the authority Congress gave it, rather than deferring to the agency's own reading of an ambiguous statute. Thursday's home-care ruling is that post-Loper Bright discipline applied to a Labor Department wage rule.
The background: exemptions as old as the modern home-care industry
The Fair Labor Standards Act has for decades treated two categories of domestic work differently from other employment: live-in domestic service workers, who reside in the household where they work, and companionship-services workers, who provide fellowship and care to people who cannot care for themselves. Employers — and in particular third-party agencies, as opposed to the household itself — have claimed exemptions from overtime, and in some configurations minimum-wage, obligations for those categories. The Labor Department rule at issue in this case tried to stop third-party employers from relying on those exemptions, which is why agency-based home health firms, rather than individual families, brought the challenge.
Source: Bloomberg Tax
That distinction — household employer versus agency employer — is the hinge of the whole case. A family that directly employs a live-in caregiver stands in a different legal position from a home-care company that employs or payrolls many caregivers and places them in clients' homes. Judge Hardy's ruling restores the exemption route for the agency side on live-in work, while leaving the department's companionship restriction standing.
Source: Law360 Employment Authority
What this means for Pennsylvania home-care workers and firms
Western Pennsylvania is where the case was decided, but the rule it strikes at was federal, and home-care agencies across the United States have been watching challenges like this one because live-in care is one of the fastest-growing corners of the care economy: an ageing population, clients who want to remain at home, and round-the-clock arrangements that can run far beyond a 40-hour week. For agencies, the ruling affects how live-in shifts can be paid. For workers — a workforce in which immigrant women, including Punjabi and other South Asian caregivers working across Pennsylvania, New Jersey and New York, are heavily represented — it affects whether hours beyond 40 in a week must be paid at the overtime premium when the employer is an agency. The ruling does not change Pennsylvania state wage law, and it does not touch the companionship restriction the judge left in place.
Source: Bloomberg Tax
Reader caution on scope: the reports of the ruling describe an exemption from certain Fair Labor Standards Act provisions for the plaintiff firms on the live-in question. They do not say every home-care worker in America has lost overtime protection, and they do not report any change to how directly employed household workers are treated. The precise reach of the order — whether it applies only to the two plaintiff companies or more broadly — is a detail the first reports summarise rather than reproduce in full, and it is one reason the Labour Department's response matters.
Source: Law360 Employment Authority
What happens next
No appeal or department response was reported in the first accounts of the ruling published on Friday, October 30. The available next steps are the standard ones after a district-court decision of this kind: the Labor Department can appeal to the U.S. Court of Appeals for the Third Circuit, which covers Pennsylvania, or it can revise its approach to the live-in exemption. Until one of those happens, Thursday's split ruling is the operative law of the case: the live-in restriction is struck down for third-party employers, the companionship restriction remains, and home-care payroll in the live-in segment has a court decision — not just an agency rule — to point to.
Source: Bloomberg Tax