Hiring Help the Right Way

Families can sometimes have some very expensive misconceptions about California’s rules for hiring a private, live-in caregiver. For starters, it is never a good idea to have verbal “handshake” agreement to compensate through a combination of money, housing and/or meals. Common mistakes include:

• Presuming the caregiver fits the California definition of “personal attendant” when not all elements are stated in writing or are not actually met in practice (www.dir.ca.gov/iwc/WageOrders2006/iwcarticle15.html at “Definitions,” section 2(J));
• Paying a caregiver less than minimum wage (currently $8.00/hour in California), even if he or she “agrees” to a lower rate of compensation (no such agreement is enforceable);
• Subtracting the “market value” of housing and/or meals when calculating the caregiver’s compensation. California Wage Order 15, section 10 defines the value of housing and meals below market value for live-in caregivers (www.dir.ca.gov/iwc/WageOrders2006/iwcarticle15.html);
• Failing to keep accurate records of hours worked and time off. Should a caregiver file a wage claim (including any possible overtime pay), written time records could be crucial;
• Assigning a caregiver as an “independent contractor” to avoid the minimum wage (or any overtime) obligations. It is unlikely that a full time caregiver could be classified as an independent contractor, even if there is a written agreement in place. This is because the hiring family member will almost certainly want to retain control over how the caregiver accomplishes his or her work. That right to control and direct will likely classify the caregiver as an employee no matter how the parties seek to label the relationship.

Thus, pertinent words to the wise include:

• Define in a written agreement the terms of the caregiver’s employment, including duties and compensation. That agreement should specify the relationship is “at will,” meaning the caregiver can resign or be released from employment at any time, with or without cause or advance notice. It is also a good idea to specify that a live-in caregiver will vacate the premises promptly when employment ends;
• Pay the caregiver at least minimum wage for all “hours worked,” defined by law as any time an employee is “suffered or permitted to work.” In other words, all time the caregiver is on duty; and
• Have the caregiver maintain a written log of all hours worked with the caregiver confirming in writing its accuracy each day.