What Happened?

If you’re a home health aide working for an agency, or you get paid as a freelancer instead of an employee, the federal rules behind your paycheck are being rewritten. The Labor Department has proposed letting home care agencies stop paying their caregivers minimum wage and overtime, and it has proposed a new test that would make it easier for companies to treat workers as independent contractors. ​

House Republicans held a hearing on the Trump administration’s push to cut workplace rules on Wednesday, Sept. 2, before the Education and Workforce Committee’s Subcommittee on Workforce Protections, according to the committee. A Legis1 preview of the hearing noted that the department has advanced more than 60 deregulatory proposals.

Why Does It Matter To Me?

The home care proposal, issued in July 2025, would let agencies again classify caregivers who provide companionship or live in a client’s home as exempt from minimum wage and overtime, returning to a standard first set in 1975, according to the law firm Littler. The independent contractor proposal, issued Feb. 27, would focus mainly on how much control a worker has and whether they can earn or lose money through their own business decisions. Contractors don’t get minimum wage or overtime protections.

Salaried workers saw a separate change in May, when the department formally scrapped a 2024 Biden-era rule that would have made more of them eligible for overtime. The cutoff stays at $684 a week, or $35,568 a year, the level the department has enforced since federal courts in Texas struck down the 2024 rule, Foley Hoag reported.

Both Sides, Now

Republicans and business groups say rules cost jobs and pay. “Compliance with the regulatory state is costly,” Douglas Holtz-Eakin of the American Action Forum told the subcommittee. The Labor Department estimates its contractor rule would save small businesses $2.31 billion over 10 years, the Small Business Administration’s Office of Advocacy noted.

Democrats say workers will pay the price. Rep. Ilhan Omar (D-MN), the subcommittee’s top Democrat, said Republican bills would make it “easier for an employer to treat a worker like an independent contractor instead of a full-time employee,” in her hearing remarks. Rebecca Reindel of the AFL-CIO testified that on worker safety rules, “there is nothing” she would cut.

What Happens Next?

Neither proposal is final. The public comment periods have closed, and the department must review those comments before it can issue final rules.

Congress could also step in. Rep. Alexandria Ocasio-Cortez (D-NY) and Sen. Patty Murray (D-WA) introduced the Fair Wages for Home Care Workers Act to block the home care change, Home Health Care News reported, but lawmakers don’t return from their election break until Monday, Nov. 9.

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