General Law Committee

JOINT FAVORABLE REPORT

Bill No.:

SB-911

Title:

AN ACT CONCERNING HOMEMAKER SERVICES AND HOMEMAKER-COMPANION AGENCIES.

Vote Date:

3/15/2011

Vote Action:

Joint Favorable Substitute

PH Date:

2/24/2011

File No.:

207

SPONSORS OF BILL:

General Law Committee

REASONS FOR BILL:

Consumers who hire caregivers from homemaker services and homemaker companion agencies may not realize that they are considered to be the employer of record by various government entities and are therefore responsible for applicable withholding taxes, insurance, and related expenses.

SUBSTITUTE LANGUAGE:

Section 3 specifies that the registry provide consumers with a notice specifying their legal liabilities. No service can commence unless the registry receives a copy of the notice signed by the consumer. Section 4, concerning notice to individuals who are listed as caregivers with registries, was removed.

RESPONSE FROM ADMINISTRATION/AGENCY:

None stated.

NATURE AND SOURCES OF SUPPORT:

Martin Acevedo; General Council of Companions & Homemakers, Inc:

This bill is designed to protect elderly home care services consumers by requiring registries to disclose responsibility with regard to payroll taxes and employee status to both consumer and worker. It protects workers who may be cheated out of benefits when they have “waived” their rights as employees. The bill is cost-neutral, and it is consistent with the State's policy against intentional misclassification of workers. They would like the Committee to add a provision making a registry's intentional misclassification of its workers a violation of the Connecticut Unfair Trade Practices Act.

Ray Boller; BrightStar:

His research made it clear that there are two sets of clients in the industry: patients and caregivers. Having registries disclose to both prospective clients and caregivers how they deal with taxes and insurance is important so both groups can make informed decisions. This makes providing quality care to the patient everyone's main focus.

Andrew Clifford; Owner, Home Instead Senior Care:

Consumers researching home care in Connecticut can find many choices. There is often no indication other than price as to the difference in the types of providers. Registries often charge less than employee-based agencies and cost-driven consumers naturally head in that direction. Despite the fact that they provide a similar “scope of service”, their manner of delivering it is quite different. Consumers don't usually know the difference and don't have all the information in order to make informed decisions.

Ken Gurin; President, CT Chapter of the National Private Duty Association and Owner, Comfort Keepers, Shelton, CT:

On the surface, registries cost about $5.00 less per hour than employer-based providers. The savings can come at a greater cost. Since consumers can become “accidental employers”, unaware that they are responsible for payroll tax withholdings and contributions, they become legally liable and Connecticut loses taxes legally owed. Additionally, independent contractors placed by registries are not provided Workers' Comp, and homeowners insurance does not typically provide coverage. The worker also loses when the time comes that they need benefits such as Social Security only to find that these contributions were never deducted. While not questioning the quality of care delivered by registries, full disclosure of potential risks is critical. Truth in advertising is long overdue.

Sharon M. Massafra; Franchise Owner/President, Home Instead Senior Care, Trumbull, CT:

Clearly defining the business relationship, responsibilities and legal liabilities of and between the elderly consumer, the professional caregiver and registries is imperative in meeting the home care needs of our growing senior population and the caregiving profession.

Nicholas Miller; Franchise Owner, Comfort Keepers, Enfield, CT:

When there is no full disclosure, it harms employees by depriving them of employment benefits, Social Security benefits, and accident insurance. It harms seniors by exposing them to risk of loss of home and savings. Most businesses are operating fairly, but disclosure protects everyone.

Dennis Patouhas; Franchise Owner, Comfort Keepers, Greenwich, CT:

SB 911 seeks to merely disclose, to both client and caregiver, their status as it relates to benefits and legal liability.

Guy Tommasi, Jr.; Managing Director, LifeTime, Solutions, LLC:

Passage of this bill will insure that both the consumer and the worker are given the ability to make intelligent, informed decisions regarding their status as employees, independent contractors, and employers. It will level the playing field and return thousands of dollars in state taxes.

Patti Urban; Certified Senior Advisor/Franchise Owner, Comfort Keepers, Guilford, CT:

The purpose of SB 911 is to protect both clients and caregivers, making everyone aware of their responsibilities.

W. Rennard Wieland; President/Owner, Connecticut In-Home Assistance, LLC:

It is confusing to the public to try and differentiate between categories of home care services. Advertising by various agencies and registries does not do much to clarify matters. Misleading advertising can lead to extreme situations. The public should be fully aware of the type of service they are choosing, as well as what their responsibilities are.

Devon Williams; ComForcare, Danbury, CT:

Consumer choice is important and should be preserved. Clients and their families should be able to hire the workers or companies that best meet their care needs, but with full disclosure from those companies.

Tracy Wodatch; Vice President, Clinical and Regulatory Services, Connecticut Association for Home Care & Hospice (CAHCH):

Registries that provide homemaker services and homemaker companion services are not regulated, yet they are caring for some of our most vulnerable population. These protections are already in place for licensed home health agencies, so this bill “closes the gap”. It ensures consumer protection and provides important consumer education.

NATURE AND SOURCES OF OPPOSITION:

Susan Christolini; President, Northwest Home Care, Inc. and Treasurer of the Connecticut Association of Home Care Registries:

The bill confuses the words “employee” and “independent contractor” by using them synonymously. They have very different meanings and are governed by different laws and regulations. Independent contractors are responsible for their own supervision and duties they perform. According to the Regulations of the Department of Consumer Protections, all agencies registered as Homemaker Companion agencies are required to provide a “clear definition of the employee, provider, and client employment relationship”, which renders SB 911 redundant. If Registries are required to comply with Section 3, Homemaker Companion agencies should also be required to comply. Having only a registry define theses issues would lead consumer to believe that Homemaker Companion agencies are not responsible for the same issues. Registries, which provide job to thousands people who care for thousands of others, should not be singled out. Perhaps there should be separate legislation for registries.

Kevin Donohue; Connecticut Association of Home Care Registries (CAHCR):

CAHCR opposes the bill because it requires a registry to provide notice to clients and caregivers concerning matters over which the registry has no control and concerning matters which the registry lacks sufficient information or legal expertise. A registry's services are referral services; they provide caregiver clients with access to client opportunities. “If a registry were to provide a consumer with a statement that it does not assume any responsibility for the payment of Social Security, overtime and minimum wage, workers' compensation and unemployment compensation insurance payments, the consumer would reasonably infer, by process of elimination, that the consumer must be responsible for making those payments – which would not be true in most cases, because caregivers commonly operate as independent contractors.” To state that a consumer “may be” responsible for certain things is misleading and would likely result in consumers opting not to accept referrals from a registry. The bill creates confusion for a home-care market that is functioning well and meeting the needs of consumers.

Reported by: Kate Hayes

Date: 3/29/2011