2013-03-22 / Columnists

Spotlight On Elder Law

By Nancy J. Brady, RN, Esq. and Linda Faith Marshak, Esq.

Home care workers can provide much needed assistance to individuals. Medicare provides limited home care benefits. Medicaid benefits are available to qualifying individuals for long term home care assistance for up to seven days a week, 24 hours a day. Should you or your loved one require home care assistance, you should review your circumstances and eligibility for these benefits with an attorney who practices in the area of elderlaw.

Aside from Medicare and Medicaid benefits, some individuals choose to hire home care workers and pay privately for those services. When hiring personal care workers or companion help to care for yourself or loved ones, you must consider the pitfalls of hiring workers “off the books.”

Employment issues can arise depending on whether the worker is classified as an independent contractor or an employee. Usually, if someone is hired for a specific one time project, for example hiring an electrician to make a one-time repair, the electrician will be considered under the law to be an independent contractor. This is because the electrician completes the job at his own direction and control. If a person is hired to work in the home, at specific hours, under specific instructions, that worker is considered to be an employee rather than an independent contractor. If someone has hired a worker that classifies as an employee, the person doing the hiring is obligated to pay certain taxes, including unemployment taxes, worker’s compensation, and applicable federal and state taxes. In the case of domestic workers, you must meet the requirements of the federal “Fair Labor Standards Act” for wages and overtime pay.

The next issue to consider when hiring workers is that under current immigration law, the person hiring is required to ensure that the worker is authorized to work, with proof of permanent residency, immigration service work authorization and a Social Security card. Individuals who hire illegal workers may be subject to criminal and civil penalties.

If the worker is injured while working at your home, or if another person is injured for something the worker did at your home, you may be held responsible. This is further complicated if the worker drives your vehicle as part of the job.

Hiring workers “off the books” in some instances is considered by the IRS to be tax evasion. These issues obviously come into play during a tax audit. In addition, such issues often exist when workers later file for unemployment. The unemployment benefits application process involves listing of previous employers. This process, with increasing frequency, raises a red flag for the IRS that the person was employed illegally, since the IRS has no record of withholdings by you, as the employer.

For these reasons, among others, hiring home care workers “off the books” is not, in our opinion, a good idea. Hiring workers privately should involve enlisting the advice of your accountant so that you can make sure to be in compliance with all tax withholding requirements. You should obtain all proper documentation to ensure legal working status and to avoid incurring fines and penalties. You should meet all insurance requirements to make sure you will not be held liable for the workers injuries or acts by the workers resulting in injuries to others.

Using agencies to hire workers either privately or through the Medicaid program can relieve these burdens. A reputable, licensed agency will hire, train and provide some supervision of workers. Payroll is managed by an agency; the workers are paid by the agency with all required withholdings for taxes and expenses. The agency should perform background and immigration checks, and the workers should be bonded and insured through the agency.

The attorneys can be reached at 1- 718-945-7777.

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