Amicus Curiae Brief — Long Island Care at Home, Ltd. v. Coke

No. 04-1315 FILED

APR 2 9 2005

IN THE

OFFICE OF THE CLERK

SUPREME COURT OF THE UNITED STATES

LONG ISLAND CARE AT HOME, LTD. and

MARYANN OSBORNE,

Petitioners,

EVELYN COKE,

Respondent.

On Petition for a Writ of Certiorari to the United States

Court of Appeals for the Second Circuit

BRIEF OF AMICI CURIAE CITY OF NEW YORK

AND NEW YORK STATE ASSOCIATION OF

COUNTIES IN SUPPORT OF PETITION FORA

WRIT OF CERTIORARI

STEPHEN J.A. ACQUARIO, MICHAEL A. CARDOZO,

General Counsel, Corporation Counsel of the

Attorney for Amicus Curiae City of New York,

NYS Ass’n of Counties, Attorney for Amicus Curiae

111 Pine Street City of New York,

Albany, NY 12207 100 Church Street

(518) 465-1473 - New York, NY 10007

(212) 788-1159 or 1065

LEONARD J. KOERNER*

PAMELA SEIDER DOLGOW,

SUSAN CHOI-HAUSMAN,

of Counsel.

*Counsel of Record

April 29, 2005

eT LAS 6

TABLE OF CONTENTS

Page

DE I ovisidictcetkeric kines ll

Preliminary Statement. 0.0.0.6... .00ccccccccccspesessees i

Interest of the Amici Curiae.................cece0000e- 2

Summary of the Argumentt..............0..cccsesssesees 4

REASONS FOR GRANTING THE PETITION.... 5

I. THE ENFORCEABILITY OF THE

THIRD-PARTY EMPLOYER

REGULATION IS OF GREAT

Se NII i 6h bsavacanscannsedasanscnteen 5

A. Economic Implications of the Circuit’s

PUN, irctcuuatisasdecas vaedsenionndiadcien 5

ee EP een eee 6

Bs I MBS ic icsiceccessedsccsss 6

i a I iene a 8

B. Implications for the Provision of Care.... 8

.. Peevacy io ie Mome..................... 9

2: GOmmy OF Cate. o.oo... cc. eic.es... 10

3. Family Compatibility................... 11

I]. THERE IS A DIRECT CONFLICT IN THE

CIRCUITS AS TO THE DEGREE OF

DEFERENCE TO BE ACCORDED THE

THIRD-PARTY EMPLOYER

REGUL ADIGE. is cicsccsecocsssnpeevonstdstewves 12

Ill. ©THE SECOND CIRCUIT’S DECISION IS

ERRONEOUS AND MISAPPLIED THIS

COURT’S PRECEDENTS REGARDING

THE DEFERENCE TO BE ACCORDED

ADMINISTRATIVE DETERMINATIONS. 13

CONCTLERSIOIN i ii ciavadadstapecsae. A iediantnaaceles 18

TABLE OF AUTHORITIES

Cases . Page

Alaska Dep’t of Envtl. Conservation v. Envtl.

Protection Agency, 540 U.S. 461 tsa 16

Barnhart v. Walton, 525 U.S. 212 (2002) .o..eecccccccccccscceoee.. 15

Batterton v. Francis, 432 U.S. 416 ROPE Prciidiincxessaditeadioiied 16

Chevron U.S.A., Inc. v. Natural Resources Defense

Council, Inc., 467 U.S. 837 ERS noe 12-14

Christensen v. Harris County,

529 U.S. 576 Cg, EEE LCDS RMT 12-13, 16

Johnston v. Volunteers of Am.., Inc.,

213 F.3d 559 (10th Cir. 2000),

cert. denied, 531 U.S. 1072 (2001)............0........... 12

Metropolitan Stevedore Co. v. Rambo,

I oc 16

Skidmore v. Swift & Co..

323 U.S. 134 Ee aievinuienccennniacstssenvasassceasiche

United States v.. Mead Corp.,

Re I ia asc cnsancnasescosececces..ccc; 12,14

Washington State Dep’t of Social and Health Servs. v.

Guardianship Estate of Keffeler,

re i 15-16

ill

Yellow Transp., Inc. v. Michigan,

BEF We ai chcacdiedibbnsceilinisindinisddactseannincion 16

Statutes and Other Authority

29 C.F.R. 552.109...... PEO? SS BRR ee! SP SERENE NO Be Te 2

CREO MO a a 2

Richard J. Pierce, Admin. L. Treatise (4"" ed. 2002).......... 15

1V

No. 04-1315

IN THE

SUPREME COURT OF THE UNITED STATES

tad

LONG ISLAND CARE AT HOME, LTD. and

MARYANN OSBORNE,

Petitioners,

EVELYN COKE,

Respondent.

On Petition for a Writ of Certiorari to the United States

Court of Appeals for the Second Circuit

BRIEF OF AMICI CURIAE CITY OF NEW YORK

AND NEW YORK STATE ASSOCIATION OF

COUNTIES IN SUPPORT OF PETITION FOR A

WRIT OF CERTIORARI

ee

PRELIMINARY STATEMENT

The City of New York (the “City”) and the New

York State Association of Counties (“NYSAC”) submit

this brief in support of the petition for a writ of certiorari in

this case. Both parties have consented to the filing of this

brief, and their consent letters are being filed herewith.'

' Counsel for the parties in this case did not author this

brief in whole or in part. No person or entity, other than

amici curiae and their counsel, made a monetary

contribution to the preparation and submission of this brief.

]

INTEREST OF THE AMICI CURIAE

The City and NYSAC have a significant interest

in having this Court grant the petition and determine the

validity of 29 C.F.R. 552.109(a) -- a longstanding United

States Department of Labor regulation (hereinafter the

“third-party employer regulation”) that applied the

“companionship services” exemption in the Fair Labor

Standards Act (“FLSA”), 29 U.S.C. §213(a)(15), to

employees engaged in providing companionship services

and “employed by an employer or agency other than the

family or household using their services.”

The provision of health care services in the home

has increased significantly in recent years. Since the early

1980's, hospital services have become much more

intensive, and daily costs have escalated enormously. At

the same time, many aspects of care formerly provided in

hospitals and in long term care institutions can be

effectively provided in the home. Vulnerable individuals

most frequently prefer to receive care at home if possible,

and this has resulted in the development of a number of

programs to facilitate their ability to do so. The cost of

these programs is largely covered by various forms of

health insurance, including Medicaid.

The City, the nation’s largest municipality,

oversees a Medicaid-funded program, which provides

personal care services to approximately 50,000 low-income

frail elderly and disabled individuals, annually, through the

use of approximately 60,000 personal care aides,

commonly referred to as home attendants. These personal

care services are delivered through contracts with over 90

provider agencies throughout the City.

Pursuant to -this program, Medicaid-eligible

individuals can obtain assistance with activities of daily

living (bathing, toileting, transferring, walking and

nutrition) when these services are medically needed to

2

allow them to continue to live at home. Personal care

services must be ordered by a client’s personal physician,

and the determination of the medically-necessary level of

care to be provided to Medicaid clients is the responsibility

of the City’s Human Resources Administration.

Medicaid clients may be authorized to receive

personal care services for periods of time ranging from 2 or

3 hours, two or three times per week, to continuous

oversight, 24 hours each day, for impaired individuals. A

home attendant may be required to sleep in the home and,

in many ways, become a member of the household. The

home attendant may accordingly be scheduled to deliver

service for many more than 40 hours per week, and while

these services must be medically required, they also require

a substantive level of compatibility with the client and the

client’s family.

As a result of the third-party employer regulation,

prior to the Second Circuit’s decision declining to enforce

that regulation, the home attendants were not subject to the

wage and overtime requirements of the FLSA, and the

annual cost to the Medicaid program of the City’s personal

care services program was approximately $1.6 billion

dollars.

NYSAC is a not-for-profit municipal corporation

incorporated pursuant to the laws of the state of New York.

The sole membership of NYSAC consists of the 62

counties in New York state. NYSAC is the only statewide

municipal association representing elected county

executives, county supervisors, legislators, representatives,

commissioners, and administrators from the 62 counties,

including the 5 counties comprising the City. NYSAC’s

activities involve essential governmental functions, and all

of its activities, including the filing of this amicus brief,

accrue to the benefit of all county governments in the state.

Outside the City, each of NYSAC’s member counties

3

provides Medicaid-funded personal care services in its

respective jurisdiction throughout the state.

The Second Circuit’s decision declining to enforce

the third-party employer regulation will have serious

ramifications for the Medicaid-funded programs, in terms

of both cost and the provision of care, for everyone

involved in the program, including the government, the

providers of service, the home attendants, and individuals

receiving personal care _ services. Therefore, the

enforceability of the third-party employer regulation is of

vital importance to the City and NYSAC.

SUMMARY OF THE ARGUMENT

The petition should be granted for three reasons.

First, the enforceability of the third-party employer

regulation is of profound importance, because it has serious

implications for the Medicaid-funded personal care services

programs, such as those administered by the City and the

counties. The Second Circuit’s decision is expected to

tremendously increase the annual cost of the programs, and

it is unclear whether additional funding will be available to

cover these cost increases. While the costs arguably couid

be limited somewhat by capping each home attendant’s

hours of service at 40 hours per week, the intimate and

ongoing nature of the home attendant/client relationship, as

well as clients’ general unwillingness to have more than

one or two attendants in the home, limit the ability to-have

multiple home attendants providing care to a client without

jeopardizing the client’s welfare.

Second, there is a direct conflict in the Circuits as to

the degree of deference to be accorded the third-party

employer regulation, with the result that the Tenth Circuit

has upheld the regulation, while the Second Circuit

declined to enforce the regulation. Third, the Second

Circuit’s decision is erroneous and misapplied this Court’s

4

precedents regarding the amount of judicial deference to be

accorded administrative determinations.

This case merits this Court’s guidance and the

exercise of this Court’s supervisory powers.

REASONS FOR GRANTING THE PETITION

I. THE ENFORCEABILITY OF

THE THIRD-PARTY

EMPLOYER REGULATION IS

OF GREAT IMPORTANCE.

The Second Circuit’s decision, declining to enforce

the third-party. employer regulation, is of profound

importance, in that it has serious implications for the

Medicaid-funded -personal care services programs

administered by the City and the counties in New York

state, in terms of both cost and the provision of care.

A. Economic Implications of the

Circuit’s Decision

In the City alone, the Second Circuit’s decision is

estimated to increase the cost of the City’s Medicaid-

funded personal care program to the elderly and disabled

by over $279 million annually.? The City’s Medicaid

funding will need to increase from $1.592 billion to about

$1.871 billion annually in order to sustain its current client

service levels. As set forth below, the estimated additional

$279 million annual cost consists primarily of: (1) overtime

pay at time and one-half for home attendants who work in

excess of 40 hours weekly; (2) an increase in billable and

overtime hours for 24 hour daily care provided by “sleep-

? In the Circuit, the City had estimated an increased annual

cost of over $263 million. The new numbers reflect the

City’s most recent figures.

in” home attendants; and (3) travel time, which will now

have to be paid to attendants who serve more than one

client and travel between cases.

1. Paid Overtime

The City currently authorizes the delivery of

approximately 105,778,000 hours of service annually to

approximately 45,000 personal care service clients.

Services to most of these clients are rendered by not-for-

profit providers operating under the invalidated third-party

employer exemption. The City’s Human Resources

Administration staff estimates that approximately 24,000

clients require more than 40 hours of personal care services

per week and that 19% of the personal care service hours

provided in City Fiscal Year 2004 were provided by

attendants working in excess of 40 hours weekly.

These hours would be subject to overtime pay under

the Second Circuit’s decision. The estimated incremental

cost of overtime is approximately $103 million annually.

2. “Sleep-In” Cases

Among the innovations deveioped by the City to

facilitate delivery of personal care services to its frail and

vulnerable residents is a service modality known as “sleep-

in” service. Under this approach, a home attendant stays

with a client for a 24-hour period, during which time the

attendant is on paid duty for 12 hours, and is off duty for

the remaining 12 hours, and is provided with sleeping

accommodations during this time. The “sleep-in” attendant

may be roused up to three times during the unpaid hours,

and so is available to assist the client with special needs,

such as toileting or turning, during the night-time hours.

Typically these services are provided by two home

attendants during the week -- one of whom stays with the

client for five 24-hour periods, and the other for the

6

remaining two. This program is well accepted by both

clients and home attendants, and reflects the close

relationship that is appropriately developed between them.

The City currently has approximately 5,400 clients

who receive 24 hour daily care from home attendants who

“sleep-in”. These sleep-in home attendants are present 24

hours daily and receive an hourly wage for each of 12

hours; they are not compensated for the 12 hour “sleep-in”

portion of the day but, rather, receive a daily shift

differential. Provider agencies are authorized to bill

Medicaid for 84 hours weekly (12 hours daily x 7 days) for

these cases.

Pursuant to the Second Circuit’s decision, the non-

paid “sleep-in” hours would be limited to 8 hours daily

under the FLSA. See 29 C.F.R. §785.22 (explaining

generally that, where an employee is required to be on duty

for 24 hours or more, a bona fide sleeping period of not

more than 8 hours may be excluded from hours worked and

that interruptions of sleep by a call to duty must be counted

as hours worked). Accordingly, the provider agency

service payment authorization for these cases would have

to be increased from 12 to at least 16 hours daily. These

additional 4 hours daily for these cases will increase the

billable hours for the City’s contracted home attendant

provider agencies by 7,841,660 hours annually, with a

resulting additional annual cost to the government of

approximately $120.9 million for straight-time service.

Further, the additional paid hours on these sleep-in

cases will also have an overtime impact since the home

attendants presently servicing these cases are already

working hours that would be subject to overtime pay if this

Court’s ruling is upheld. Accordingly, the additional hours

subject to wages on the sleep-in cases will also be subject

to paid overtime. The cost of the overtime (i.e., the

additional one-half-time cost) for these hours is about $40

million annually.

3. Travel Time

The City’s Medicaid-funded personal care service

program includes approximately 12,300 clients who receive

an average of 21 hours of service weekly. Many of the

home attendants service more than one of these cases in

order to earn a full-time wage.

Presently, home attendants’ wages are limited to

hours actually worked; the home attendant is not paid for

the time spent traveling between cases. Pursuant to the

Second Circuit’s decision, the time spent in transit by these

employees will be subject to wages under the FLSA. See

29 C.F.R. §785.38 (explaining generally that travel time

spent by an employee in travel as part of his principal

activity, such as travel from job site to job site during the

work day, must be counted as hours worked). The City’s

Human Resources Administration staff conservatively

estimates the annual cost to government as about $13.3

million.

In short, the economic impact of the Second

Circuit’s decision is tremendous.

B. Implications for the Provision of

Care

It is unclear whether the additional funding to cover

the increased costs will be available.

As to the personal care services program overseen

by the City, 50% of the cost is covered by the federal

government, 40% by the state, and 10% by the City. The

City negotiates the hourly rates for each provider

prospectively and then submits them to the state for

8

approval. The City has submitted a request to the state for

increased rates, in light of the Second Circuit’s decision,

and is awaiting the state’s determination. If the request is

not approved and additional funding is not appropriated by

the state in its budget, the providers will have no funding

source to pay the additional costs to comply with the

FLSA. :

It might be argued that some of the costs outlined

above could be avoided by limiting the hours of service

provided to an individual client by a home attendant to a

maximum of 40 hours per week. Thus, for example, a

client requiring 24 hour coverage would be served by

multiple home attendants. However, there are substantive

reasons why this is not readily doable. The relationship

between a home attendant and the client, while not limited

to delivery of companionship, nonetheless is one of special

intimacy and confidentiality. Building such a relationship is

not a simple matter, and clients are in general unwilling to

enter into such a relationship with more than one or two

individuals. Some of the issues affecting this relationship

are discussed below.

1. Privacy in the Home

Although the home attendant’s role is to provide

paraprofessional service to a client, the service setting

differs significantly from a hospital or a doctor’s office, in

that the service is rendered in the client’s home, and the

nature of the service is intensely personal. The home

attendant spends up to 24 hours each day in the client’s

home, tending to needs of an extremely personal nature,

such as bathing or toileting. It is therefore essential for the

home attendant to build a trusting personal relationship

with the client, as otherwise the attendant’s presence will

be seen as being overly intrusive, and the client will not

cooperate or allow the necessary level of personal

intervention.

Home attendants are trained and assisted to present

themselves professionally to the client. However, to carry

out personal care services appropriately also requires

acceptance of the home attendant by the client. In many

instances it takes a considerable time to build such a

relationship, and clients often are very unwilling to enter

into such a relationship with more than one or two such

individuals. Experience shows that clients often are

unwilling to accept alternative coverage when a home

attendant takes vacation or sick leave, preferring to suffer

lack of what may often be very necessary care until the

person with whom the client is comfortable returns from

leave.

2. Continuity of Care

Although the services provided by the home

attendant are limited to assistance with activities of daily

living, clients receiving this care are frail elderly and/or

disabled, and the service has been determined to be

medically necessary. Clearly, all clients are impaired to

some extent through ongoing illness and disability, and

these problems may well result in additional, immediate

clinical needs. The home attendant is required to become

familiar with the client’s medical circumstances, to assist

the client in making physician visits, and to promptly

identify and report any changes in the client’s clinical

status. The home attendant must engage in ongoing

interaction with the client regarding the client’s health

status: to do this requires that the client is comfortable with

the home attendant and has confidence in sharing intimate

information. The home attendant must be knowledgeable

about the client’s clinical arrangements, and must be able to

contact the relevant medical professional if necessary.

3. Family Compatibility

In many instances, clients live in the home with }

other family members. The home attendant’s services are

limited to caring for the client, but the attendant must be

able to render these services in a way that does not result in |

problems in the household. Building such domestic

relationships can be difficult and time-consuming. In other

instances, the client may live alone. It then becomes the

responsibility of the home attendant to assure that the client

maintains adequate relationships with children, siblings,

etc., and to assist with family relationships in a way that

meets the client’s requirements and expectations. Such

relationships can be demanding and difficult, and the home

attendant is required always to place the client’s needs

before those of the family members who may be placing

pressures on both the attendant and the client. If the

client’s family is unwilling to allow multiple attendants in

the home, the family may insist that the client is transferred

to a nursing home. :

In short, the inherently intimate and ongoing nature

of the relationship between the home attendant and the

client, as well as clients’ unwillingness to have multiple

attendants in the home, limit the ability to provide multiple

attendants for each client, in order to keep costs down.

This Court should review the Second Circuit’s

decision, given the serious implications in terms of both

cost and the provision of care for the Medicaid-funded

personal care services programs administered by the City

and the counties in New York State.

1]

li. THERE IS A DIRECT

CONFLICT IN THE CIRCUITS

AS TO THE DEGREE OF

DEFERENCE TO BE

ACCORDED THE THIRD-

PARTY EMPLOYER

REGULATION.

The Second Circuit’s decision as to the degree of

deference to be accorded the third-party employer

regulation conflicts directly with that of the Tenth Circuit

in Johnston v. Volunteers of Am., Inc., 213 F.3d 559 cio"

Cir. 2000), cert. denied, 531 U.S. 1072 (2001). In

Johnston, the Tenth Circuit accorded the third-party

employer regulation deference pursuant to this Court’s

decision in Chevron U.S.A., Inc. v. Natural Resources

Defense Council, Inc., 467 U.S. 837 (1984) and upheld the

regulation. See Johnston, 213 F.3d at 561-62. In this case,

by contrast, the Second Circuit declined to accord the third-

party employer regulation Chevron deference, applied the

less-deferential standard of Skidmore v. Swift & Co., 323

U.S. 134 (1944), and declined to enforce the regulation. See

Coke, Pet App. at 19a-29a.

While the Second Circuit attempted to distinguish

Johnston on the ground that it pre-dated this Court’s

decision in United States v. Mead Corp., 533 U.S. 218

(2001) (see Pet. App. at 21la-22a), as explained by this

Court, “Chevron did nothing to eliminate Skidmore’s

holding that an agency’s interpretation may merit some

deference whatever its form,” or “to eliminate Skidmore’s

recognition of various justifications for deference

depending on statutory circumstances and agency action.”

Mead, 533 U.S. at 234, 236-38.

Indeed, in cases following Chevron but pre-dating

the Tenth Circuit’s decision in Johnston, this Court applied

the less-deferential Skidmore standard, in reviewing certain

administrative determinations. See, e.g., Christensen v.

12

Harris County, 529 U.S. 576, 586-87 (2000) (applying the

less-deferential Skidmore standard in reviewing a

Department of Labor opinion letter). Thus, the fact that the

Tenth Circuit’s decision in Johnston pre-dated this Court’s

decision in Mead does not in any way minimize the direct

conflict between the Circuits.

III. THE SECOND CIRCUIT’S DECISION

IS ERRONEOUS AND MISAPPLIED

THIS COURT’S PRECEDENTS

REGARDING THE DEFERENCE TO

BE ACCORDED ADMINISTRATIVE

DETERMINATIONS.

The Second Circuit’s decision is erroneous and

misapplied this Court’s precedents regarding the deference

to be accorded administrative determinations.

In Chevron U.S.A., Inc. v. Natural Resources

Defense Council, Inc., 467 U.S. 837 (1984), this Court

upheld a regulation of the Environmental Prot ‘ction

Agency, on the ground that it was a permissible

construction of the Clean Air Act. This Court explained

that, if Congress has not directly spoken to the precise

question at issue and has delegated to an agency to

elucidate a specific statutory provision, the agency’s

regulation, which is then considered legislative, must be

given controlling weight, unless it is arbitrary, Capricious,

or manifestly contrary to the statute. Jd. at 842-44. This

Court noted that the fact that the agency has from time to

time changed its interpretation does not mean that the

agency’s interpretation is not entitled to deference. This

Court emphasized that an agency, to engage in informed

rulemaking, must consider varying interpretations and the

wisdom of its policy on a continuing basis. Jd. at 863-64.

Additionally, this Court noted that an agency to which

Congress has delegated policymaking responsibilities may,

within the limits of its delegation, properly rely on the

13

incumbent administration’s view of wise policy to inform

its judgments. /d. at 865-66.

In United States v. Mead Corp., 533 U.S. 218

(2001), this Court held that a tariff classification in a U.S.

Customs Service ruling letter regarding day planners was

not entitled to Chevron deference. This Court explained

that Chevron deference applies when the statute is

ambiguous, Congress has delegated authority to the agency

to make rules carrying the force of law, and the agency

interpretation was promulgated in the exercise of that

authority. Jd. at 226-27, 229.

This Court, in holding that Chevron deference did

not apply, relied on the facts that there was no indication

that Congress meant to delegate authority to Customs to

issue ruling letters with the force of law and that the ruling

letter: was not subject to a notice and comment procedure;

did not go beyond the specific case under review and did

not bind third parties; was subject to modification without

notice, except to those persons to whom the letter was

addressed; could be issued by any of 46 different Customs

offices, which issued approximately 10,000 to 15,000 such

letters per year; and did not have to be published. /d. at

223-24, 230-34.

In this case, pursuant to the above standards, the

third-party employer regulation was entitled to Chevron

deference. There is no dispute that the companionship

exemption expressly delegated authority to the Department

of Labor to define and delimit the terms “companionship

services” and “domestic service employment.” See 29

U.S.C. §213(a)(15); Coke, Pet. App. at 20a, 23a.

Additionally, as explained by petitioners, the Department

of Labor third-party employer regulation was promulgated

in the exercise of that authority, where: the third-party

employer regulation expressly relies on the companionship

exemption; Part 552 of the regulations indicates that the

14

companionship exemption was the authority for all of the

regulations in that part; and the Department of Labor, in its

rulemaking and brief, has proclaimed that the third-party

employer regulation was a legislative regulation

promulgated pursuant to the Congressional delegation. See

Pet. at 18-22.

Unlike in Mead, the administrative determination at

issue here is a regulation, not a letter ruling, and carries the

force of law, in that it: is published and was subject to the

notice and comment procedures; goes beyond one case and

binds all employees of third-party employers; and has been

in force for thirty years without change, notwithstanding

that Congress has on numerous occasions amended 29

U.S.C. §213, which contains the companionship

exemption. Thus, the Second Circuit misconstrued Mead

in erroneously declining to accord the third-party employer

exemption Chevron deference. See also Richard J. Pierce,

Admin. L. Treatise §6.4 at 324-25 (4"" ed. 2002) (explaining

that legislative rules have binding effect, are required to be

promulgated pursuant to notice and comment procedures,

are within the scope of rulemaking authority conferred by

Congress, and impose distinct obligations on members of

the public).

Indeed, further supporting the proposition that the

Second Circuit misapplied this Court’s decision in Mead is

the fact that, following Mead, this Court does not appear to

have declined Chevron deference to any similar regulation.

See, e.g., Washington State Dep't of Social and Health

Servs. v. Guardianship Estate of Keffeler, 537 U.S. 371,

382, 390 (2003) (holding that Chevron deference was owed

to the regulations of the Commissioner of Social Security);

Barnhart v. Walton, 535 U.S. 212, 217-22, 224-25 (2002)

(same and explaining that Chevron was the appropriate

standard, given “the interstitial nature of the legal question, :

the related expertise of the Agency, the importance of the

question to the administration of the statute, the complexity

15

of that administration, and the careful consideration the

Agency has given the question over a Jorg period of time”);

Yellow Transp., Inc. v. Michigan, 537 U.S. 36, 41, 45-48

(2002) (according Chevron deference to _ Interstate

Commerce Commission regulations, which were issued

pursuant to an express delegation by Congress, after notice

and comment proceedings, and differed from the regulation

originally proposed).

Chevron deference appears to have been declined

oniy to internal guidance memoranda and interpretations

contained in publicly available operating instructions for

processing social security claims, which were not the

product of formal rulemaking. See Alaska Dep't of Envitl.

Conservation v. Envtl. Protection Agency, 540 U.S. 461,

487-88 (2004); Washington State Dep't of Social and

Health Servs., 537 U.S. at 385-86.

This post-Mead treatment of such regulations is

consistent with other pre-Mead cases. See, e.g., Christensen

v. Harris County, 529 U.S. 576, 586-88 (2000)

(emphasizing that “[o]f course, the framework of deference

set forth in Chevron does apply to an agency interpretation

contained in a regulation”); Metropolitan Stevedore Co. v.

Rambo, 521 U.S. 121, 137 n.9 (1997) (noting that no

deference was required to the interpretation of the

Administrative Procedure Act by the Director of the Office

of Workers’ Compensation Programs, where, inter alia,

that interpretation was not embodied in any regulation or

similar binding policy pronouncement to which Chevron

deference would apply); Batterton v. Francis, 432 US.

416, 425-26 & n.9 (1977) (a pre-Chevron case noting that

courts are not required to give effect to interpretive

regulations, but emphasizing that where Congress expressly

delegated to an agency to prescribe standards or interpret

Statutory terms, the agency adopts regulations with

legislative effect, which are entitled to review under the

arbitrary and capricious standard).

16

In short, the Second Circuit erred and misapplied

this Court’s precedents when it declined to accord Chevron

deference to the Department of Labor’s third-party

employer regulation. The third-party employer regulation

is reasonable, especially where, as noted by the District

Court and explained by the-Department of Labor, part of

the reasoning behind the FLSA companionship services

exemption is to allow those in need of such services to find

assistance at a price they can afford and prevent them from

unnecessariiy being forced into long-term care institutions.

As emphasized by the District Court, whether the services

are provided by direct hiring or through the use of an

agency, the objective is still the same: to allow the

procurement of companionship services without being

required to meet the minimum wage and overtime

provisions of the FLSA. See Pet. App. at 52a, 63a, 70a-7 1a.

In order to avoid repetition, the amici curiae adopt

the other arguments made by petitioners in support of a

grant of certiorari.

17

CONCLUSION

THE PETITION FOR A WRIT OF

CERTIORARI

GRANTED.

STEPHEN J.A. ACQUARIO,

General Counsel,

Attorney for Amicus Curiae

NYS Ass'n of Counties,

111 Pine Street

Albany, NY 12207

(518) 465-1473

SHOULD BE

Respectfully submitted,

MICHAEL A. CARDOZO,

Corporation Counsel of the

City of New York,

Attorney for Amicus Curiae

City of New York,

100 Church Street

New York, NY 10007

(212) 788-1159 or 1065

LEONARD J. KOERNER*

PAMELA SEIDER DOLGOW,

SUSAN CHOI-HAUSMAN,

of Counsel.

*Counsel of Record

18