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Home Health Care Firm to Pay $2.2 Million for Travel Time and Expenses Under Settlement

In the recent case of Thomas v. Total Health Home Care Corp., Pa. Ct. C.P., No. 79-07111379, a Pennsylvania state court judge has given preliminary approval to a settlement in which a Pennsylvania home health care company has agreed to pay more than $2 million to eligible employees for time spent traveling between the homes of clients.

This was the first settlement of what is expected to be several class action lawsuits on this issue.

In May of 2006, a class of home health care workers filed a suit against Total Health Home Care for violations of the Pennsylvania Minimum Wage Act and the Pennsylvania Wage Payment and Collection Law. Essentially, the employees claimed that they were not being compensated for traveling time. The settlement of this case illustrates the extent of potential liability in wage and hour litigation.

Under the settlement agreement, which would apply to some 3,000 home health workers employed by Total Health from May 18, 2002, to March 17, 2007, the company will place $2.2 million into a settlement account to be distributed to class members. Total Health’s President, Michael J. Callahan, in noting the complexity of wage and hour laws, stated that "there is considerable confusion and widely varying interpretations regarding the conflicting federal and state wage mandates that pertain to the home health industry." He added that the money that would have been spent to litigate the issue in court would be "better spent by voluntarily changing company policy."

The Total Health class-action lawsuit was the first of four parallel suits filed in Pennsylvania against home health care companies. In some of the other suits, in addition to seeking pay for travel time and expenses, the plaintiffs are seeking overtime pay.

Employers should take note of the extremely serious consequences of failing to properly pay employees. Even if an employer prevails in wage and hour litigation, expenses may be enormous. Moreover, an employer can face additional damages if its violation of wage and hour law is found to be "willful." Cases such as the above are exactly why employers should be vigilant about complying with wage and hour laws. Employers should consider conducting an audit of current payment practices. Legal counsel can assist in these highly technical matters.

If you have any questions regarding this, or any other legal issue, please feel free to contact a member of Greenebaum's Labor and Employment Practice Group.

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