Running a home care registry can feel like you’re managing three businesses in one. You’re connecting clients with caregivers, supporting schedule mapping, and tracking payments. You’re also trying to grow. But there’s a quiet threat that can undo all that hard work in an instant: audit risk.
Registry owners often underestimate how quickly things can go sideways when their operation isn’t structured the right way. Most are so focused on client care and daily tasks that they don’t realize their tools, processes, and payment methods might actually be setting them up for problems with the Department of Labor.
Misclassification Is Easier Than You Think
Let’s talk about misclassification. This is when a caregiver who should legally be classified as an employee is treated as an independent contractor. When the DOL audits a business, this is one of the first things they look at.
Registry owners know they work with 1099 contractors. But that distinction can get blurry if you’re not careful. If you're collecting timesheets, issuing checks from your business account, or using software that makes it look like you're directing care, you might be crossing the line without realizing it.
Duct-Taped Tools Make Things Worse
Plenty of registries rely on a mix of spreadsheets, generic scheduling apps, payment platforms, and paper records. At a glance, this setup feels flexible and affordable. In reality, it's the perfect storm for audit risk. When payment records don’t line up, visit logs are incomplete, or it looks like you’re managing caregivers directly, you create a paper trail that works against you.
Even if you’re doing nothing wrong on purpose, poor documentation and payment flows can make it look like you are. And the DOL doesn’t accept "We didn’t know" as an excuse.
What You Can Do to Protect Your Registry
Start by creating clear separation between your business and the caregivers you work with. This means:
- Don’t pay caregivers from your own entity. Use a service that handles payments under their own name, creating distance between you and the care being delivered.
- Use a system that logs every visit with electronic verification, so there's a reliable trail.
- Make sure payments flow directly from clients to the service handling disbursement, without you acting as the middleman.
- Keep consistent, detailed records for every visit, payment, and communication.
You don’t need to build this from scratch. Look for services designed specifically for registries using 1099 contractors. These platforms should focus on audit protection, not just convenience.
A Clean Setup Builds Credibility
Running a tight ship doesn’t just reduce audit risk. It makes your business look more professional. Families will feel more confident choosing your registry when your process is clear and organized. Caregivers appreciate reliable pay and clear expectations. Referral sources want to know their clients are being sent to someone who takes their business seriously.
All of that starts with the systems you use.
Don’t Wait Until It’s Too Late
The threat of an audit doesn’t disappear just because no one’s come knocking yet. If your tools or processes could raise questions, now is the time to fix them. Audit protection isn’t a feature you turn on. It’s the result of setting up your business the right way from the start.
You’re not just avoiding fines. You’re building peace of mind. And that lets you focus on growing your registry, not worrying about what happens if the DOL comes calling.
If you’re still relying on patchwork tools, it might be time to rethink your setup. Find a platform or service that understands the registry model and puts your protection first. You’ll feel the difference in how confidently you can run your business.
