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Labor Exploiters Operating RCFEs in California

A new exposé from Reveal focuses on illegal labor practices in California assisted living facilities, also known as RCFEs (Residential Care Facilities for the Elderly).  The article reveals a shocking number of illegal labor cases where caregivers are exploited to supply facility operators’ with luxury goods and other wealth. The caregivers, often new immigrants with few resources, feel compelled to accept adverse working conditions and wages that are only one half to one quarter of the minimum wage.

While the labor practices of the facility operators are abhorrent, they are enabled by a widely tolerant state oversight system. Underpaying workers does not mean operators will lose their license as it appears labor enforcement actions are not triggering action from the Department of Social Services, which licenses the care homes.As described in the article, labor law violators simply set up Limited Liability Companies (LLCs) or declare bankruptcy to shield themselves from the consequences of their bad conduct and perhaps even expand their operations. By putting an RCFE in the name of an LLC, the individual owner’s history can be hidden in their application for a license.

CANHR is currently sponsoring AB 737 (Eggman) which would empower the Department of Social Services to connect LLCs or other companies back to their individual owners to stop bad actors from controlling RCFEs, exploiting workers, and harming residents. The bill will be heard in the Senate Committee on Human Services on June 10.

CLICK HERE to read the LA Times story.

CLICK HERE to watch the PBS NewsHour video “Why Some Residential Caregivers Call Their Jobs ‘Indentured Servitude.’”