My SIL wants to hire our 24 hour Home Health Aide privately to care for my FIL. But we hired her from an agency... Is this possible?

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My SIL wants to hire our 24 hour Home Health Aide privately to care for my FIL. But we hired her from an agency... Is this possible?

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It seems unethical, but trying to come up with ideas for affordable home care and we love the aide.

Care Team Elder Law Home Care Paying for Care

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I used a nationally known home care agency to care for my mom for roughly 5 years. Along the way I had some caregivers that I would have liked to hire on my own. Unfortunately, you sign a contract with the agency that specifies you cannot hire a caregiver for 1 year after they leave the agency. Otherwise you have to pay the agency $25,000.00. I'm sure most reputable agencies have a similar arrangement.

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Regarding Self-Employed Caregivers(CG) I live in the Charlottesville, VA area. I am a Home Care Nurse. I have worked with several self-employed CG whom I have met during my work day when I am in patients homes. When I am able to observe positive healthy interactions between the patient and caregiver, I get the CG name and phone number so I can keepThen employed with other referrals. These people are Mostly women but a few men also. They carry their own health and liability insurance. They pay their own taxes. The hourly rate in our area is 15-25$/hour.

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I'm a Certified caregiver with a great agency in Newport News VA. I work fulltime. (My agency pays caregivers more than other agencies pay theirs.) My agency allows their caregivers to have second jobs of any type anywhere EXCEPT for *stealing* the agency's clients of course. If I decided to take on a private duty client I wonder where I would go to buy liability insurance and why exactly I would need it? If I already have health insurance why would I need to purchase a liability policy to work as a caregiver? It's the CLIENT who needs to have the liability insurance to protect themselves if the private caregiver should ever sue them. Am I missing something here?

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From my experience, hiring the aide privately is a conflict of interest and may cost her full time employment with the agency. Perhaps the aide could recommend someone who doesn't work for the agency or hire someone else from the same agency.

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IMHO, this may be a conflict of interest, but I am not a medical professional, nor am I an attorney.

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I don't know if this applies here but there are strict labor laws regarding employment of "domestic workers" which serve to protect these workers from exploitation. For example every hour the employee works in addition to full time, the employer is required to pay that employee time and a half. From the perspective of this law, working 24 hr shifts without paying time and a half for the additional 16hrs is clear grounds for the employee to file a lawsuit against you. I was forced into that position after working as a nanny.

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Regarding the question of paying a caregiver "under the table" in cash, does your mother have Long Term Care Insurance? Does your mother intend to claim the expense of having a caregiver as a deduction on her taxes? If the answer to either one of these questions is 'yes' then your mother is required to submit documents to the insurance company describing the type, amount, cost of care and in many cases proof of the caregiver's Certification in order to file a claim, and of course to the IRS to claim the deduction. These documents require the caregiver's Social Security information. Bear in mind the caregiver will then be required to pay income tax on the cash you paid her because the IRS has her Social Security number referencing her income paid by you. These are considerations to keep in mind in addition to the issues involving becoming an "employer". I haven't read through all of the comments so my point here may have already been addressed.

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Be very careful about the advice you may receive here as the law can be very different between states. In some states, to do what you suggest could be a violation of a contract. As well, there can be many pitfalls in trying to pay a caregiver under the table. For example, if they should injure themselves, which is not at all uncommon, in some states, if not all, they can sue you.

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Actually, it is probably more common that you think. The agency charges you for their employee as well as for the management of their company. If the employee wants to leave and go into business for herself, she has the right to do so. Maybe she doesn't get any kind of benefits, like insurance, paid vacation, etc and has nothing to lose. If she is discussing this with you, she needs to find out if she signed some sort of agreement with them that says she cannot work for a patient for X number of days after she leaves their employment. That would be common practice, too, to keep her from leaving current agency, going to another agency (or on her own) and taking away business from current employer -- maybe a non-compete or non-solicitation agreement

You might be giving her somewhat of a raise per hour and still pay less than you do right now. The biggest thing for you is going to be - how you pay her. Will you be withholding taxes? Does she want cash that she does not have to report to IRS? Unreported earnings, from your perspective, will be that you can no longer claim the care on your own taxes and 24/7 private pay care would be a big sum that you lose in deductions each year. You might want to talk to your tax person or a cpa about this before making the change.

Also, what 'Taarna' said below. Someone that agrees to work 24/7 still needs day's off, unexpected absence, that an agency would cover. What will you do about those days?

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So, you hired an Agency and they met or exceeded your expectations and sent you a wonderful Aid who does a wonderful job. In turn for their exceptional service you want to fire them and steal their employee, causing irreparable harm to their business. Is it unethical? Do you really have to ask?

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You can ask her. She is a free agent to do as she pleases. There are advantages to having 1 caregiver - consistency. There are also disadvantages, no one to care when caregiver gets sick or wants a vacation. Agencies should cover gaps in care - illness of employee, vacation, days off - with their own staff.

My MIL did well with 4 caregivers through 1 agency that provided 24/7 care for her in her condo in Hawaii. She now goes to adult day program and has a caregiver at night.

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You can do it above board by paying the agency a one-off introduction fee. The alternative would be that the aide leaves her agency, but she will probably find that her contract prevents her from then immediately taking a role with one of the agency's clients; and she would not be safe to assume that they won't enforce it when, rather than if, they find out.

In any case: have you actually asked the aide whether she is interested? If she were my friend I'm not sure I'd advise her to accept the offer, and certainly not if the agency she works for is a good one.

And again, from your point of view: what happens if she falls ill or is injured? It's never wise to place all your eggs in one basket, so to speak.

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Paying her privately would not save much money when you consider having an elder law attorney draft a contract, then an accountant or payroll company to manage the payments to social security, workman's comp, liability insurance, federal, state and local taxes. What about health insurance, if you provide it that could easily be another thousand a month. And paid vacation? And don't forget the fee to buy the caregiver from the agency. What if she decide to quit within a couple of months?

Sure, giving her a raise and paying under the table would save money. That is illegal and could get everyone in trouble with the IRS and other taxing authorities. Not paying into social security will effect the caregiver's benefit when she retires. Without a caregiver contract and legal payment could effect mom's ability to get Medicaid should she ever need it. Payments to caregiver without proper accounting would be considered a gift and subject to a penalty, the period of time that mom would be denied Medicaid until private pay equals the penalty. If caregiver were paid $36,000.00, under the table for one year, then once mom needs Medicaid fees to nursing home would have to be paid out of pocket for three months if nursing home fee was $12,000.00 a month. 12x3=36.

Be Kind, be very careful with under the table payment. Do you pay taxes, etc on the income? Do you pay into social security? What will happen if you are injured on the job?

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This is excellent advice. There is much to consider with liability and tax considerations if you go with someone not from an agency directly.

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I’m a CNA who does exactly what you are describing. I’ve been hired privately and I make $15/hr dayturn. It’s better for her and better for you-no middle man to eat up her profit and your bank account at the same time.

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How do you and patient handle paying taxes? Are you contract labor, no taxes withheld, and take care of it yourself at the end of the year with a 1099? Did you and patient create a contract or agreement about days you would be off unexpectedly? Some of that info might be helpful to this poster

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if you hire someone "under the table" after a certain amount paid to them you become their employer and responsible filing their taxes,which is known as a "granny tax"-- which also means if you fire them or no longer need them they can get unemployment from you. If you hire outside an agency due to not being insured and claim to fall in your estate they can also sue you for injuries.

Sure people pay under the table all the time...but it can come back and bite
https://www.irs.gov/businesses/small-businesses-self-employed/family-caregivers-and-self-employment-tax

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When we signed on with our agency, they told us that if we tried to hire that person privately that we would pay a fine of $10,000.

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This is way more common that you think. We had aides (who were sisters) through an agency who we hired privately. They were with us for over two years. They said that many aides work for an agency only to procure private employment. Don’t worry the agency won’t go through the trouble and expense to sue you.

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I hired an aide privately after I hired her from an agency. I pay by check, so I have proof for my records. The agency wasn’t paying her a lot & when they did, it was late. I was comfortable with the aide & knew they did background check & everything so I didn’t have to do it. Also, my mother is sometimes difficult & abusive but the aide ignores it. Most aides would just walk out & tell agencies to send them somewhere else...can’t blame them! I would too, if she were not my mother! Hugs 🤗

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If the caregiver is working for an agency many agencies have a policy that their employees can not work privately for a client. (non compete clause in their contract)
If she did go to work for your family she would probably be fired from her current employer.
You would have to legally take taxes out and file proper paperwork as her employer. If you are to do this I strongly suggest you get Workman's comp insurance added to homeowners policy.
You will also need to follow rules about how much time this person is working, time off, so you will probably need 2 people. (not sure how your 24 hour aid is now getting time off) But you do need to follow all the rules an employer has to follow. It is not as easy as it sounds and there is a lot of paperwork that need to be done in a timely manner

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Non compete clauses are unenforceable if it stops a person from working in the field they are trained in. Can not legally stop someone from earning a living.

These terms are used to intimidate and enslave people, it is quite sad how companies treat workers.

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It also depends on her current employer . One employer I had would take an employee to court for a large sum of money for violation of the contract.

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Aside from any contract prohibitions or provisions, when hiring someone directly, you become the employer. That means you have to provide any needed liability, workman's comp and any "benefits" the person receives like health insurance. In addition, you must pay the employer's share of the Social Security and FICA tax, withhold federal/state/local income taxes and remit those to the federal government and state quarterly, as I understand it. You will need to get an employer taxpayer ID for that purpose. You can't just pay cash out of pocket, at least not legally. It's not like hiring a babysitter for a night.

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When I was looking for in-home help, the first thing I did was ask for a copy of the contract to review. Every single one had clauses preventing the direct hiring of any of their staff w/o compensation, sometimes ranging into the $5,000 to $10,000 range.

Do you have one health aide on duty for 24 hours?   That's a lot for one person.

Unfortunately, much as I searched, I was unable to find a home care worker outside of an agency. The ones who were interested either weren't experienced, didn't have any insurance, and just weren't the right fit.   But those weren't the bigger issues, which were the costs and liability.

In order to hire this aide directly, you'd have to pay her directly as well, raising the issue of obtaining liability insurance, taking deductions and sending them to the IRS, and possibly the state.

The comp insurance, which in my state can't be added to a HO policy but would have to be a commercial comp policy, would have cost approximately $750 annually, with increases up to $1K the second year.   If the worker was injured, that comp policy could be paying out for years, causing you to dip into cash reserves you might have.

These are some of the downsides to hiring someone directly, especially for a 24/7 job.

BTW, I love your cute dog!

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In short, usually not.
You sign on with the agency and they provide insurance and bonding for you. You usually sign a non-compete clause, too.

When my client's family found out how meagerly you get paid as CG they went THROUGH my company and upped my bas salary so I was making a decent $15 an hour instead of $8. One of the client's sons was a lawyer and he did all the legwork. I didn't ASK for the raise, b/c the company DID NOT give raises, ever. Whatever amt you 'hired on' at was what you made no matter how long you worked for them.

Appalling, really. Plus my client routinely tipped me 'out of pocket' when she had me do extra stuff for her that wasn't in the contract. I've never felt so valuable and loved as I did those years I worked for her!

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The Agency may have had the caregiver sign a clause in the contract that prohibits her from accepting a private job with the client directly. If the caregiver did sign such a contract and there was a penalty for her to pay if she did accept private work, then you could pay that fee for her and that would solve the problem.

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Our contract with our CG said we had to pay a large "buy out" fee if we hired her privately. We loved her,, but the buy out was the deal breaker. Look at your contract and see what it says.

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My SIL wants to hire our 24 hour Home Health Aide privately to care for my FIL. But we hired her from an agency... Is this possible?

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