Hospitals' Use of Volunteer Staff Runs Risk of Skirting Labor Laws, Experts Say

The U.S. health system benefits from potentially more than $5 billion in free volunteer labor annually.

This article was published on Tuesday, January 10, 2023 in Kaiser Health News.

By Lauren Sausser, Kaiser Health News

MOUNT PLEASANT, S.C. — Most of the 30 volunteers who work at the 130-bed, for-profit East Cooper Medical Center spend their days assisting surgical patients — the scope of their duties extending far beyond those of candy stripers, baby cuddlers, and gift shop clerks.

In fact, one-third of the volunteers at the Tenet Healthcare-owned hospital are retired nurses who check people in for surgery or escort patients to a preoperative room, said Jan Ledbetter, president of the hospital's nonprofit Volunteer Services Organization. Others relay important information from hospital staffers to expectant families. "They're kept extremely busy," Ledbetter said. "We need to have four of those volunteers a day."

At hospitals across the U.S., volunteers play an integral role. So much so that when volunteers were barred from East Cooper at the beginning of the COVID-19 pandemic, staff nurses assumed the volunteers' duties in the surgical waiting room. Like paid employees, hospital volunteers typically face mandatory vaccine requirements, background checks, and patient privacy training. And their duties often entail working in regular shifts.

At HCA Healthcare, the world's largest for-profit hospital system, volunteers include aspiring medical providers who work in patient rooms, in labs, and in wound care units, according to the company's magazine.

Over centuries, leaning on volunteers in medicine has become so embedded in hospital culture that studies show they yield meaningful cost savings and can improve patient satisfaction — seemingly a win-win for hospital systems and the public.

Except, there's a catch.

The U.S. health system benefits from potentially more than $5 billion in free volunteer labor annually, a KHN analysis of data from the Bureau of Labor Statistics and the Independent Sector found. Yet some labor experts argue that using hospital volunteers, particularly at for-profit institutions, provides an opportunity for facilities to run afoul of federal rules, create exploitative arrangements, and deprive employees of paid work amid a larger fight for fair wages.

The federal government instructs that any person performing a task of "consequential economic benefit" for a for-profit entity is entitled to wages and overtime pay. That means profit-generating businesses, like banks and grocery stores, must pay for labor. A Chick-fil-A franchise in North Carolina was recently found guilty of violating minimum wage laws after paying people in meal vouchers instead of wages to direct traffic, according to a Department of Labor citation.

Still, volunteer labor at for-profit hospitals is commonplace and unchecked.

"The rules are pretty clear, and yet it happens all the time," said Marcia McCormick, a lawyer who co-directs the Wefel Center for Employment Law at Saint Louis University. "It's a confusing state of affairs."

In a statement, HCA spokesperson Harlow Sumerford said coordinators oversee hospital volunteers to ensure they are participating in appropriate activities, such as greeting and assisting visitors. Tenet Health spokesperson Valerie Burrow did not respond to a question about how the company ensures that its volunteer activities comply with federal labor laws.

Ben Teicher, a spokesperson for the American Hospital Association, whose members include more than 6,000 nonprofit, for-profit, and government hospitals, did not respond to a question about whether the organization offers guidance to hospitals regarding the legal uses of volunteers.

Meanwhile, the pandemic made the importance of hospital volunteers more apparent. In March 2020, volunteer programs nationwide were largely disbanded, and the volunteers' roles were filled by staff members — or left unfilled — when hospitals closed their doors to everyone except employees, patients, and a few visitors. Volunteers were welcomed back once vaccines became widely available, but many didn't return.

"We've lost so many volunteers," said Ledbetter, who runs the volunteer group at East Cooper Medical Center. "They found something else to do."

On South Carolina's Hilton Head Island, Vicki Gorbett, president of the island's hospital auxiliary, estimated 60% of the group's volunteers who left during the pandemic haven't returned. Much larger hospital systems, some of which boast hundreds or thousands of volunteers, have been affected, too.

"We're building back from the absolute bottom," said Kelly Hedges, who manages volunteers at the Medical University of South Carolina.

Hedges was furloughed for the better part of six months when hospital volunteers were sent home in March 2020. She estimates there are about 600 volunteers at MUSC's hospital campus in Charleston now, down from 700 before the pandemic.

"During a labor crisis, this is a department you want in operation," she said.

While hospital volunteer programs reboot across the country, labor experts say using volunteers may expose some medical facilities to liability.

The Fair Labor Standards Act prohibits "employees" — defined broadly as people an employer "requires or allows" to work — from volunteering their time to for-profit private employers. The same law also requires these employees to be paid no less than the federal minimum wage.

These regulations make it "very, very difficult" for a volunteer to donate time to a for-profit hospital, explained Jenna Bedsole, an employment attorney in Birmingham, Alabama.

The right to be paid isn't waivable, McCormick said, meaning that even those volunteers who don't consider themselves employed may be entitled to compensation. However, the U.S. Department of Labor is "stretched pretty thin" and doesn't enforce the rules that apply to for-profit companies, except in extreme circumstances, she said.

She cited a court ruling in 2017 that found people who volunteered at consignment events for Rhea Lana — a for-profit company that organizes the resale of children's clothing — were employees who should be paid.

But in most cases, McCormick said, it is difficult to determine the outcome of enforcement actions against for-profit companies.

"The Department of Labor sends a letter to the putative employer warning them that it thinks the FLSA is being violated," she said, "and it may not take any other action. And it only issues news releases for big cases."

Companies are more likely to be targeted for the inappropriate use of unpaid interns, she said.

But this isn't to say that, in some cases, individuals can't donate their time in a for-profit setting. In a for-profit nursing home, the federal government has said, people may volunteer without pay if they're attending "to the comfort of nursing home residents in a manner not otherwise provided by the facility." That might include reading to a resident, for example.

One-off charitable opportunities are also possible. A choir group could host a concert in a hospital lobby without violating the law, or a community organization could serve hospital staffers an appreciation lunch.

Beyond that, for-profit "hospitals potentially expose themselves to risk of civil liability," Bedsole said, which could add up in terms of back pay due to employees, fines, and legal fees. If hospital volunteers provide essential services, there is a danger they could be held liable, she said.

Nonprofit hospitals must follow federal labor laws, too.

At the small, nonprofit Baptist Memorial Hospital-Leake in Carthage, Mississippi, the coordinator of volunteers, Michelle McCann, can't use a volunteer in any role that matches an employee's job description. She said she's also prohibited from asking a hospital employee who is off the clock to volunteer their time for a job similar to their own.

"We'd have to pay them for the hours," said McCann, national president of the Society of Healthcare Volunteer Leaders.

Nonprofit hospitals are required to provide a benefit to their communities, such as offering charity care, in exchange for their special tax status. But when it comes to making money, the differences between for-profit and nonprofit hospitals are often negligible to the casual observer, said Femida Handy, a professor of social policy at the University of Pennsylvania.

"When you go to the hospital, do you ask for the tax status?" she asked.

Sam Fankuchen, CEO of Golden, a company that develops software used to organize volunteer labor, said the pandemic hastened a change in public opinion. "Just because an organization is nonprofit, it doesn't necessarily mean they're 100% dedicated to the greater good," he said. "Some nonprofits are better run than others."

Most volunteers are simply trying to figure out how and where they can help in the best possible way, he said.

"The consideration about the tax structure is secondary," said Fankuchen, whose software is used by hospitals and other businesses. "The big picture is that hospitals exist to deliver care. I think it's reasonable that they have volunteer programs."

Jay Johnson, support services manager at Trident Medical Center in North Charleston, South Carolina, coordinates roughly 50 volunteers who contribute an estimated 133,000 hours annually to the for-profit hospital, which is owned by HCA Healthcare.

Trident's volunteers are widely beloved by the staff, he said.

"We actually had a ceremony for them when they came back" when restrictions loosened, Johnson said. Beyond that, volunteers benefit from premium parking spaces and free lunches "to really make sure they're appreciated," he said.

Trident volunteers are required to be vaccinated and undergo a background check. Then, they are assigned to the areas that best match their interests.

Breast cancer survivor Pat LoPresti for example, volunteers in Trident's Breast Care Center. Volunteering provides a sense of purpose and an opportunity to socialize, said LoPresti, a retiree who met her husband, another volunteer, while volunteering at the hospital.

"I started volunteering there because they could use me," LoPresti said. "It's such a privilege to help people in a time when they need it."

Lauren Sausser: lsausser@kff.org, @laurenmsausser