Policy: A Roadblock and Pathway to Securing Care Worker Rights

“Taking care of children or elders or people with disabilities…[has been] historically undervalued…It just wasn’t even treated as real work, and in many cases it’s still not—largely because of who is doing this work.” – Terri Harkin, Healthcare Career Advancement Program

“Back in the 80s, when I was very young, I tried to get into caregiving and it was very discouraging…we had no training whatsoever, the pay was very little, and I could not afford to pay my bills and support my two children. I ended up leaving my job but when my mother got very ill ten years ago, I became her caregiver…It was amazing to see how things have changed from then to now.” – A home care worker and member of SEIU 775

Home care, child care, and other forms of domestic work have been historically undervalued, in no small part because of who comprises the workforce. Disregard for these workers in America is rooted in the legacy of slavery and Jim Crow, and perceptions that care work—traditionally performed by women, particularly Black women—is not real work. Federal policy, dating back to the 1930s, has reinforced labor market structures that contribute to low wages, lack of benefits, and limited worker protections for independent home care and family child care providers. The New Deal era ushered in a series of legislative reforms aimed at protecting vulnerable workers from unsafe and predatory working conditions but largely excluded domestic workers.

For instance, the Fair Labor Standards Act of 1938 (FLSA) established minimum wage and overtime pay standards affecting full-time and part-time workers in the public and private sector, but domestic workers were considered exempt from the FLSA's requirements for decades. A 1974 amendment to the FLSA granted domestic workers minimum wage and overtime pay protections, yet those who worked with the elderly or children were still excluded. It was only in 2015, when the U.S. Department of Labor (DOL) implemented a regulation under the FLSA, known as the Home Care Rule, that minimum wage and overtime protections were extended to most home care workers.¹ However, family child care providers still do not have protections under FLSA, in part because they are considered self-employed.

Home care workers and family child care providers have had a long history of organizing and forming unions to advocate and lobby for better wages and benefits. However, this activity is not protected at the federal level. The 1935 National Labor Relations Act (NLRA), which applies to most private sector employers and grants employees the right to form or join unions and engage in protected, concerted activities to advocate for improved working conditions, explicitly excludes workers “in the domestic service of any family or person at his home.” And because the NLRA only applies to employees, self-employed family child care providers are not covered. The NLRA also elevates enterprise-level over sectoral bargaining approaches by establishing a single worksite/single employer as the default unit for bargaining. However, home care workers and family child care providers do not work together at a single job site and instead work from their own or others’ homes, and do not have a traditional employer with whom they can collectively bargain for improved wages, benefits, and training. Without the right to collectively bargain, these workers have struggled to make significant inroads.

Recent Supreme Court decisions have made worker organizing more challenging by limiting the ability of unions to collect dues or agency fees from non-union members covered under collective bargaining agreements. In 2014, the Supreme Court ruled in Harris v. Quinn that the First Amendment prohibits the collection of an agency fee from home health care providers who do not wish to join or support a public sector union. The ruling created a distinction between partial public employees (like Medicaid-funded health workers) and fully public employees whose direct employer is the government and who under Abood v. Detroit Board of Education (1977) can be required to fund union activities that benefit all workers. The Supreme Court went on to eliminate the agency fee requirements with its ruling in the 2018 Janus v. American Federation of State, County and Municipal Employees (AFSCME) case. The court held that requiring public employees to pay agency fees is unconstitutional under the First Amendment. These rulings have limited financial resources for unions in recent years.

Nonetheless, home care workers in eight states² and family child care providers in about a dozen states³ have managed to secure the right to collectively bargain via executive action, legislative reform, or ballot measures. What distinguishes these workers from other independent providers is that much of their work is publicly funded: Medicaid in the case of home care workers and state child care subsidies for family child care providers serving low-income families. In several states, these workers have succeeded in securing sectoral bargaining power by leveraging the publicly funded nature of their work to establish a common employer with whom to negotiate.

Public Authorities and Job Quality

“If you don’t have a connection back to a funding source, what changes are [family child care providers] really going to make?” – Kursten Holabird, executive director of the SEIU Education and Support Fund

The nature of home care funding has made way for workers in seven states to establish an employment relationship with public entities created by a state or county government, also known as public authorities or home care authorities (HCAs).⁴ Establishing HCAs as the employer of record for home care workers has positioned workers to collectively bargain for improved wages, benefits, and training opportunities. The Service Employees International Union (SEIU) first succeeded in implementing this organizing model in California, where counties receive federal and state dollars to manage and partially support their local home care systems. In the 1990s, SEIU advocated for legislation that required counties to establish local public authorities with which home care workers could collectively bargain. A coalition including the disability rights community, families, advocates for the elderly, and workers came together to ensure the sustainability of this workforce through better wages and benefits.

California’s decentralized approach to home care public authorities, through which the union negotiates individual contracts with each of the state’s 58 counties, is unique and has resulted in a wide range of compensation and benefits for workers. The HCA model has since been implemented in Connecticut, Oregon, Illinois, Massachusetts, Minnesota, and Washington, all of which operate statewide public authorities. In the seven states with HCAs, home care workers earn more than the average national wage, and all are on track to reach or are already above $15/hour in their current contracts. Home care unions have also managed to secure health care, paid time off, retirement, and other benefits through negotiations with HCAs. In addition to improving job quality for home care workers, HCAs have the benefit of increasing access to quality care by arranging and managing HCBS for Medicaid beneficiaries, setting standards for home care worker training, and maintaining a registry to match home care providers with clients to preserve consumer choice. These authorities align the interests of workers and families needing services around the common goal of high-quality home-based care.

Organizing History

California’s In-Home Supportive Services (IHSS) program, created in 1973, provides personal care services, including house cleaning, meal preparation, and grocery shopping to more than 600,000 low-income consumers who are unable to live safely at home without assistance.⁵ By the early 1990s, consumers were struggling to find adequate care. Due to low wages and difficult working conditions, turnover was very high, and when a care provider quit, it was difficult to find and screen a new aide. Some individuals needing assistance were forced into nursing homes because they could not find care in the community.⁶ In 1992, consumers, organized labor, workers, and state and local officials came together to propose legislation that would authorize the creation of county-level public authorities to manage the IHSS program and act as the employer of record. In total, seven counties chose to create this structure, and the workforces unionized soon after. In 1999, workers pushed for additional legislation to direct additional dollars to the program. More counties joined, and today, 58 counties have home care authorities that serve as the employer of record.

Facilitating Conditions that Led to Worker Organizing

A crucial component of success in California passing the initial legislation in the early 1990s was that the campaign was narratively driven by consumer needs and concerns.⁷ The consumer was centered as the main beneficiary early in the process, and thus higher wages were cast as a benefit to the consumer, neutralizing the argument that higher costs could lead to less service.⁸

More recently, the SEIU has been pushing for increased training of workers. Initially, the disability community was skeptical, as there were concerns that increased training requirements would decrease consumer choice. However, by positioning training as an important step towards higher quality care and partnering with specific training groups, this concern was overcome.⁹ There are still insufficient resources to meet all training needs, but there have been significant investments in this area.

Additionally, while county supervisors were often perceived to be a barrier, many had experienced the difficulties in accessing care themselves. This highlights an opportunity in this space: so many people know firsthand how important this work is, and how hard it is to access. The coalition for these initiatives is therefore very broad with the correct messaging.

Workforce Demographics

According to PHI, in California, this workforce is 85 percent female, 70 percent workers of color, 48 percent foreign-born, and 53 percent have a high school diploma or less.

Success/Benefits for Workers

Overall, there is large variation across the state due to the county-level model. The first benefit to workers under this model has been increased wages. In the 1990s, after the initial legislation, workers in counties with home care authorities earned up to two dollars more per hour than their counterparts in counties without the public authority. This is in part what drove the broader state-wide effort.

In terms of other benefits, only one county offers retirement benefits. The state legislated that workers have access to sick days, so in all counties, workers have access to three sick days off. Additionally, working with external partners such as the University of California San Francisco, the union has been able to implement widespread training for workers to increase access to career advancement and improve the quality of care.

Continued Challenges

The most challenging aspect of increasing standards for care workers that is specific to California is the fragmentation of the system. Contracts need to be negotiated in each county, and each time new coalitions need to be built to push for change. This is unique to the California system.

Much like with independent home care workers, family child care providers’ success in securing collective bargaining rights has hinged on the ability to establish a state government entity with which to negotiate. Under federal labor laws, state or local governments are under no obligation to recognize or negotiate with family child care unions. As self-employed individuals, family child care providers face additional hurdles to collective bargaining because they are subject to state and federal antitrust laws that prevent them from engaging in anticompetitive activities, such as negotiating wage rates. The way around antitrust laws is to secure a legal exemption via legislative reform or executive action. Following in the footsteps of home care workers, family child care providers in multiple states have pushed for the establishment of the state as the employer of record as well as the authority to unionize and collectively bargain. In Illinois and Washington, this statewide organizing has not only led to increased subsidy rates for family child care providers but also state contributions to a health insurance plan for workers.

Independent home care workers and family child care providers that have managed to establish a state or county agency as their employer of record are generally not considered public sector employees. While legislation giving Illinois family child care providers the right to collective bargaining determined they were public employees, it was only for the limited purposes of collective bargaining. By not designating home care workers and family child care providers as public sector employees, state or county governments are under no obligation to automatically extend costly health care, retirement, paid leave, and unemployment insurance benefits traditionally afforded to government workers.

Prioritizing Worker Power and Voice

Outside of negotiating contracts with state or local governmental entities, care workers have reaped benefits from broader worker advocacy campaigns. State and regional efforts to increase the minimum wage to $15/hour have buoyed home care provider efforts to improve worker wages in California, Washington, and other states. Home care providers in some states have also seen an increase in compensation through wage minimums under publicly funded state care systems. Home care services are paid for using a mix of federal and state funding, with Medicaid serving as the primary source of long-term home care funding for the elderly and individuals with disabilities, and Medicare covering the cost of short-term in-home care. Generally, public funding is allocated for services and not specifically designated for the wages of service providers. However, more than half of states have at some point implemented a Medicaid wage pass-through, requiring that a certain amount of Medicaid resources flow directly to care workers. For example, one year after introducing a wage pass-through in Kansas for care workers in skilled nursing facilities and home care, annual turnover dropped by 10 percentage points.¹⁰

The development of worker cooperatives, which are owned and democratically controlled by employees, have also emerged as a strategy for promoting better working conditions and benefits for home care providers. Evidence from Cooperative Home Care Associates, the largest and longest-operating home care worker co-op, suggests that the annual turnover in home care cooperatives is less than half the industry average, which may lead to better quality care.¹¹

To date, there are roughly a dozen home care worker cooperatives in operation and another dozen or so in development in the United States.¹² Worker cooperatives are less common in the early child care space, however. As of 2019, fewer than 10 worker cooperatives in child care were operating, with another dozen or so known to be in the planning or conversion process.¹³ There are two family child care provider cooperatives operating in Illinois and Pennsylvania, banding together to more effectively manage business operations and facilitate training.¹⁴ This business model has great potential to democratize child care work through business conversions as center owners retire. However, despite the benefits of cooperatives to workers and consumers, the fact that they require significant financial and capacity-building resources to stand up has limited their ability to expand.

In 2018 Congress passed the Main Street Employee Ownership Act, which encourages lending to small businesses interested in converting to an employee stock ownership plan (ESOP) or a co-op. But workers, particularly those in low-paying occupations, often struggle to produce the collateral required by most financial institutions, including the Small Business Administration (SBA), to obtain a loan. The low wages in home care and child care, combined with the historic marginalization of the workers who typically occupy these roles, makes traditional loans an unsuitable vehicle for funding worker-owned cooperatives. The racial wealth gap and gender wealth gap mean that this workforce is less likely to have access to the capital required to start a business.¹⁵ Therefore, rethinking loan eligibility requirements is key to ensuring that federal cooperative development resources and strategies help dismantle long-standing barriers to worker ownership. The USDA Cooperative Development Grant program, which offers technical assistance to support cooperative development in rural areas in addition to loans, presents a promising federal investment in worker cooperatives.

History

Cooperative Home Care Associates (CHCA) was founded in 1985 in the Bronx with just 12 home health workers. In 2003, CHCA workers unionized with SEIU 1199 after the union had secured significant pay increases for Medicaid-funded personal care workers across the state. One of only a handful of home care cooperatives in the United States, and by far the largest, CHCA is a promising model of care worker empowerment and improved job quality.

Workforce Demographics

Currently, nearly 1,700 individuals work for CHCA, making it the largest worker-owned cooperative in the United States: approximately half are owners. Nearly all workers—95 percent—are women of color.¹⁶

Facilitating Conditions that Led to Worker Organizing

Community development leaders in New York City with the Community Service Society were interested in connecting local residents with quality jobs that benefited the community.¹⁷ Home care, a field with low wages, unreliable hours, and lack of benefits (just as today), was seen as an occupation that could be improved for the sake of workers and the community.

CHCA began operating its own training within its first few years. Finding that training through higher education and local nonprofits did not fit worker needs, CHCA founded the Paraprofessional Health Institute (PHI) in 1991 to provide training. PHI and CHCA still partner to offer four-week courses for aspiring home care workers, with a guaranteed CHCA job at the end. Approximately 600 New Yorkers per year complete the training and begin a career with CHCA.

Benefits for Workers

CHCA workers and worker-owners benefit from a number of job quality improvements, both due to the cooperative model and workers’ representation by SEIU 1199. First, the structure of a worker cooperative means that worker priorities like training, better wages, health benefits, and stable scheduling are the business’s priorities. As of 2002, approximately 80 cents of every dollar of CHCA income went to worker wages or benefits; at other home care agencies in New York City, only about 70 cents per dollar went to wages and benefits.¹⁸ Furthermore, turnover at CHCA is less than one-third of the national average.¹⁹ Finally, experienced CHCA aides benefit from guaranteed paid hours, which stabilizes income and reduces turnover. Over its 35 years, CHCA workers have seen significant wage increases. Most wage increases are due to the role of the employee union, though CHCA workers do earn slightly more than other home care workers in New York City who are also unionized.

Continued Challenges

While CHCA is well established and the cooperative model has much to offer the home care profession, creating new cooperatives often comes with significant challenges. Home health workers wishing to form a cooperative may confront difficulties in securing sufficient startup capital, with similar challenges in converting conventional home health agencies to worker-owned cooperatives. Once these initial financial hurdles are cleared, cooperatives—like other home health agencies—experience extremely tight profit margins. Though worker-owned cooperatives prioritize workers’ well-being, pay, and benefits, there may be little profit to reinvest in workers.