EXHIBIT 10.2


                              EMPLOYMENT AGREEMENT

          This  Employment  Agreement  dated as of  November  1,  2001,  between
National Home Health Care Corp., a Delaware corporation having an address at 700
White  Plains  Road,  Scarsdale,  New York  10583  (the  "Company"),  and Steven
Fialkow,  an individual  having an address at 700 White Plains Road,  Scarsdale,
New York 10583 ("Employee").

                              W I T N E S S E T H :
                              - - - - - - - - - -

          WHEREAS,  the  Company  desires  that  Employee  be employed by it and
render  services to it, and  Employee is willing to be so employed and to render
such services to the Company,  all upon the terms and subject to the  conditions
contained herein.

          NOW,   THEREFORE,   in  consideration  of  the  mutual  covenants  and
agreements  contained  herein,  and other good and valuable  consideration,  the
receipt and  sufficiency of which is hereby  acknowledged,  the parties agree as
follows:

          1. Employment.  Subject to and upon the terms and conditions contained
in this  Agreement,  the Company  hereby agrees to employ  Employee and Employee
agrees to enter the employ of the Company, for the period set forth in Paragraph
2  hereof,  to  render  the  services  to the  Company,  its  affiliates  and/or
subsidiaries described in Paragraph 3 hereof.

          2. Term.  Employee's  term of employment  under this  Agreement  shall
commence on the date hereof (the  "Commencement  Date") and shall continue for a
period through and including the fifth anniversary of the Commencement Date (the
"Employment  Term")  unless  extended  in  writing  by both  parties  or earlier
terminated pursuant to the terms and conditions set forth herein.

          3. Duties. (a) Employee shall be employed as the Company's  President,
Chief Executive Officer and Secretary.  It is agreed that Employee shall perform
his  services in the  Company's  Scarsdale,  New York  facilities,  or any other
facilities mutually agreeable to the parties.  The rights and duties of Employee
shall not in any way be curtailed  by the Company  without his consent nor shall
he be deprived of the dignity ordinarily associated with his offices.

             (b) Employee agrees to abide by all By-laws and applicable policies
of the Company  promulgated  from time to time by the Board of  Directors of the
Company,  including  without  limitation  the  Business  Policies of the Company
annexed hereto as Annex A..

          4. Exclusive  Services and Best Efforts.  Employee shall devote all of
his working time,  attention,  best efforts and ability during regular  business
hours exclusively to the service of the Company, its affiliates and subsidiaries
during the term of this Agreement.



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<PAGE>

          5. Compensation.  As  compensation  for his  services  and  covenants
hereunder, the Company shall pay Employee the following:

             (a) Base  Salary.  The Company  shall pay  Employee a minimum  base
salary  ("Salary")  of $325,000 per year.  The Salary shall be subject to review
and adjustment on an annual basis beginning  November 1, 2002, (if this contract
is then in effect) or, at the Company's discretion,  on such earlier date as the
Company may  designate;  provided,  however,  that in no event shall  Employee's
Salary be adjusted below the Salary designated herein.

             (b) Bonus Compensation. The Company shall pay Employee annual bonus
compensation ("Bonus Compensation") equal to four percent of the amount by which
the income  from  operations  in any fiscal  year  during  the  Employment  Term
(determined  in  accordance   with  general   accepted   accounting   principles
consistently applied) exceeds $3,300,000. The foregoing Bonus Compensation shall
be paid by the Company  within thirty (30) days after  completion of the audited
financial results of the Company for the applicable fiscal year.

             (c)  Options.  The Company may grant to Employee  from time to time
options to purchase  shares of the Company's  common stock pursuant to the terms
of any of the  Company's  stock  option  plans  and  any  related  stock  option
agreement  required to be executed in connection  therewith.  Such options shall
have such terms and conditions as shall be determined by the Board of Directors.

          6. Business  Expenses.  Employee shall be reimbursed for, and entitled
to advances  (subject to repayment  to the Company if not  actually  incurred by
Employee)  with respect to, those  business  expenses  incurred by him which are
reasonable and necessary for Employee to perform his duties under this Agreement
in accordance with policies established from time to time by the Company.

          7. Employee Benefits.  (a) During the Employment Term,  Employee shall
be entitled to such insurance, disability and health and medical benefits and be
entitled to participate in such  retirement  plans or programs as generally made
available to executive  officers of the Company  pursuant to the policies of the
Company;  provided that Employee shall be required to comply with the conditions
attendant  to  coverage  by such plans and shall  comply with and be entitled to
benefits only in  accordance  with the terms and  conditions  of such plans.  In
addition,  as soon as practicable  following  execution of this  Agreement,  the
Company  shall  establish  a  non-qualified   deferred  compensation  plan  (the
"Deferred  Compensation  Plan") under which Employee's account shall be credited
with  $12,000 no later than October 31st of each fiscal year during the next ten
fiscal years beginning with 2002,  provided that the Employee is employed by the
Company  on such  October  31st.  If  Employee's  employment  with  the  Company
terminates prior to October 31, 2011 for reasons other than Employee's death, as
of  the  date  of  such  termination,  Employee's  benefit  under  the  Deferred
Compensation  Plan and all amounts  credited to  Employee's  account  thereunder
(including any earnings thereon) shall be forfeited.  Employee shall be entitled
to three weeks paid vacation each year during the Employment  Term



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<PAGE>

at such times as does not, in the reasonable  opinion of the Board of Directors,
interfere with Employee's  performance of his duties hereunder.  The Company may
withhold  from any benefits  payable to Employee all federal,  state,  local and
other taxes and amounts as shall be permitted or required  pursuant to law, rule
or regulation.  In addition to the foregoing,  the Company shall pay to Employee
the full amount of Employee's  annual  contribution  under the Company's Premium
Conversion  Plan,  payable  in  accordance  with the  Company's  normal  payment
practices.

             (b) Employee shall be entitled to receive the sum of $550 per month
as an  automobile  allowance  provided at the  expense of the  Company  from the
Commencement  Date and during the  Employment  Term,  which  allowance  shall be
exclusive  of  all  expenses  related  to  car-phone,   insurance,  repairs  and
maintenance for such automobile, which expenses also shall be the responsibility
of the  Company.  Employee  agrees not to lease any  automobile  covered by such
allowance for a term longer than two years.  Notwithstanding the foregoing,  the
Company may, at its option, elect to provide Employee an automobile of the make,
model and year  mutually  agreeable  to the Company and  Employee,  all costs of
which associated with insurance,  repairs,  maintenance and other expenses shall
be the responsibility of the Company, in lieu of the above described  automobile
allowances,  all as may be mutually  agreed  between  Employee  and the Company.
Employee  acknowledges  that  some  or  all  of  the  foregoing  may  be  deemed
compensation to him.

          8. Death and  Disability.  (a) The Employment  Term shall terminate on
the date of Employee's  death, in which event  Employee's  Salary,  reimbursable
expenses and benefits  owing to Employee  through the date of  Employee's  death
shall be paid to his estate. Employee's estate will not be entitled to any other
compensation upon termination of this Agreement pursuant to this Paragraph 8(a).

             (b) If,  during  the  Employment  Term,  in the  opinion  of a duly
licensed  physician  selected  by  Employee  and  reasonably  acceptable  to the
Company,  Employee,  because of physical or mental illness or incapacity,  shall
become  substantially  unable to perform the duties and services required of him
under this Agreement for a period of twelve  consecutive months the Company may,
upon at least twenty (20) days' prior written notice given at any time after the
expiration  of such  twelve-month  period to Employee of its intention to do so,
terminate this  Agreement as of such date as may be set forth in the notice.  In
case of such  termination,  Employee  shall be  entitled  to receive his Salary,
reimbursable  expenses  and  benefits  owing  to  Employee  through  the date of
termination.  Employee  will not be  entitled  to any  other  compensation  upon
termination of this Agreement pursuant to this Paragraph 8(b).

          9. Termination for Cause. (a) The Company may terminate the employment
of Employee  for Cause (as  hereinafter  defined).  Upon such  termination,  the
Company  shall be  released  from any and all  further  obligations  under  this
Agreement,  except that the  Company  shall be  obligated  to pay  Employee  his
Salary,  reimbursable expenses and benefits owing to Employee through the day on
which  Employee  is  terminated.  Employee  will not be  entitled  to any  other
compensation upon termination of this Agreement pursuant to this Paragraph 9(a).



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<PAGE>

             (b) As used herein,  the term "Cause"  shall mean:  (i) the willful
failure of Employee to perform his duties pursuant to Paragraph 3 hereof,  which
failure is not cured by Employee  within thirty days  following  written  notice
thereof from the Company;  (ii) any other  material  breach of this Agreement by
Employee,  including any of the material  representations  or warranties made by
Employee;  (iii)  any act,  or  failure  to act,  by  Employee  in bad  faith or
intentionally  to the detriment of the Company;  (iv) the commission by Employee
of an act involving  moral  turpitude,  dishonesty,  theft,  unethical  business
conduct, or any other conduct which significantly  impairs the reputation of, or
harms,   the   Company,   its   subsidiaries   or   affiliates;   or   (v)   any
misrepresentation,  concealment  or omission by Employee of any material fact in
seeking employment hereunder.

          10. Change in Control. In the event of a Change in Control, as defined
below, of the Company, the Company shall pay to Employee a lump-sum amount equal
to one-half of Employee's Salary at the time of the occurrence of such Change in
Control,  which amount shall be paid within ten days after such occurrence.  The
foregoing  payment  shall be in  addition  to and shall not reduce or in any way
affect the terms of payment of any amounts to which  Employee  shall be entitled
hereunder.  The Company  hereby agrees to obtain an agreement from any successor
to assume and agree to honor and perform  this  Agreement.  For purposes of this
Agreement, a "Change in Control" shall have occurred if:

                 (i) any  "person",  as such term is used in Sections  13(d) and
14(d) of the Securities  Exchange Act of 1934, as amended (the  "Exchange  Act")
(other than the Company, any trustee or other fiduciary holding securities under
an employee  benefit  plan of the Company,  Frederick H. Fialkow or Dr.  Bernard
Levine or any of their  respective  immediate  family  members or affiliates (as
such  terms is  defined  in Rule 405  under the  Securities  Act of 1933) or any
corporation owned, directly or indirectly, by the stockholders of the Company in
substantially  the same proportions as their ownership of stock of the Company),
is or  becomes  the  "beneficial  owner" (as  defined  in Rule  13d-3  under the
Exchange Act), directly or indirectly, of securities of the Company representing
30% or more of the  combined  voting  power of the  Company's  then  outstanding
securities;

                 (ii) during any period of not more than two  consecutive  years
(not including any period prior to the execution of this Agreement), individuals
who at the beginning of such period  constitute the Board,  and any new director
(other than a director  designated by a person who has entered into an agreement
with the Company to effect a



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<PAGE>

transaction  described in clause (a), (c) or (d) of this Section) whose election
by the Board or  nomination  for  election  by the  Company's  shareholders  was
approved by a vote of at least  two-thirds of the directors then still in office
who either were  directors at the  beginning of the period or whose  election or
nomination  for election  was  previously  so approved,  cease for any reason to
constitute at least a majority thereof;

                 (iii)  the  shareholders  of the  Company  approve  a merger or
consolidation of the Company with any other corporation, other than (A) a merger
or  consolidation  which would  result in the voting  securities  of the Company
outstanding  immediately  prior  thereto  continuing  to  represent  (either  by
remaining  outstanding  or by being  converted  into  voting  securities  of the
surviving  entity)  more than 80% of the  combined  voting  power of the  voting
securities of the Company or such surviving entity outstanding immediately after
such  merger or  consolidation  or (B) a merger  or  consolidation  effected  to
implement a recapitalization of the Company (or similar transaction) in which no
"person" (as hereinabove  defined) acquires more than 30% of the combined voting
power of the Company's then outstanding securities; or

                 (iv) the shareholders of the Company approve a plan of complete
liquidation  of the Company or an agreement for the sale or  disposition  by the
Company of all or substantially all of the Company's assets.

          11.  Disclosure of  Information  and  Restrictive  Covenant.  Employee
acknowledges that, by his employment,  he has been and will be in a confidential
relationship  with the Company and will have access to confidential  information
and trade secrets of the Company, its subsidiaries and affiliates.  Confidential
information  and  trade  secrets  include,  but are not  limited  to,  customer,
supplier  and client  lists,  price  lists,  marketing,  distribution  and sales
strategies and procedures,  operational and equipment techniques, business plans
and  systems,  quality  control  procedures  and systems,  special  projects and
technological research,  including projects, research and reports for any entity
or client or any  project,  research,  report  or the like  concerning  sales or
manufacturing  or new  technology,  employee  compensation  plans  and any other
information   relating  thereto,  and  any  other  records,   files,   drawings,
inventions,   discoveries,   applications,   processes,   data  and  information
concerning  the  business  of the  Company  which are not in the public  domain.
Employee agrees that in  consideration of the execution of this Agreement by the
Company,  except in any way with respect to foreign affiliates of the Company as
of the date hereof:

             (a) Employee will not,  during the term of this Agreement or at any
time  thereafter,  use,  or  disclose  to any  third  party,  trade  secrets  or
confidential  information  of  the  Company,  including,  but  not  limited  to,
confidential  information or trade secrets belonging or relating to the Company,
its subsidiaries,  affiliates, customers and clients or proprietary processes or
procedures of the Company, its subsidiaries,  affiliates, customers and clients.
Proprietary processes and procedures shall include, but shall not be limited to,
all information  which is known or intended to be known only to employees of the
Company, its respective



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<PAGE>

subsidiaries  and affiliates or others in a confidential  relationship  with the
Company or its respective  subsidiaries and affiliates which relates to business
matters.

             (b)  Employee  will not,  during  the term of this  Agreement  and,
unless  Employee's  employment  hereunder is  terminated  (i) by Employee on the
basis that the Company has breached any provision of this Agreement or there has
been the  occurrence of any of the  circumstances  set forth in Paragraph  11(g)
below  or (ii) by the  Company  without  Cause,  for a  period  of one (1)  year
thereafter,  directly or indirectly,  under any  circumstance  other than at the
direction and for the benefit of the Company,  engage in or  participate  in any
business activity, including, but not limited to, acting as a director, officer,
employee,  agent,  independent  contractor,  partner,  consultant,  licensor  or
licensee, franchisor or franchisee, proprietor, syndicate member, shareholder or
creditor or with a person having any other relationship with any other business,
company, firm occupation or business activity, in any geographic area within the
United States that is,  directly or  indirectly,  competitive  with any business
conducted by the Company or any of its  subsidiaries  or  affiliates  during the
term of this  Agreement  or  thereafter.  Should  Employee own 5% or less of the
issued and  outstanding  shares of a class of securities  of a  corporation  the
securities  of which are  traded on a  national  securities  exchange  or in the
over-the-counter  market, such ownership shall not cause Employee to be deemed a
shareholder under this Paragraph 11(b).

             (c) Employee will not,  during the term of this Agreement and for a
period  of one (1) year  thereafter,  on his  behalf  or on  behalf of any other
business enterprise,  directly or indirectly,  under any circumstance other than
at the  direction  and for the  benefit  of the  Company,  solicit or induce any
creditor,  customer,  supplier, officer, employee or agent of the Company or any
of its  subsidiaries or affiliates to sever its  relationship  with or leave the
employ of any of such entities.

             (d) If  Employee's  employment  is  terminated  (constructively  or
otherwise)  by the  Company  for  any  reason  then,  in  consideration  for his
covenants  contained in this  paragraph 11 and not as  severance  pay,  Employee
shall be entitled to receive,  for the year following the date his employment so
terminates,  an amount equal to  Employee's  annual salary at the rate in effect
immediately  prior to his  cessation  of  employment  with the  Company  (or, if
greater,  at the  highest  annual  salary  rate in effect at any time during the
one-year period preceding the date of such  termination).  Such amounts shall be
in addition to any amount  otherwise  payable under this  Agreement and shall be
paid in equal monthly installments,  with the first such installment  commencing
on the last day of the month in which Employee's employment so terminates.

             (e) This  Paragraph  11 and  Paragraphs  12, 13 and 14 hereof shall
survive the expiration or termination of this Agreement for any reason.

             (f) It is expressly agreed by Employee that the nature and scope of
each of the  provisions  set forth above in this Paragraph 11 are reasonable and
necessary.  If, for any reason, any aspect of the above provisions as it applies
to  Employee  is  determined  by  a  court



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<PAGE>

of competent  jurisdiction to be unreasonable or  unenforceable,  the provisions
shall only be  modified to the minimum  extent  required to make the  provisions
reasonable  and/or  enforceable,  as the case may be. Employee  acknowledges and
agrees that his services are of a unique  character and expressly  grants to the
Company or any  subsidiary,  successor or assignee of the Company,  the right to
enforce the provisions above through the use of all remedies available at law or
in equity, including, but not limited to, injunctive relief.

             (g) The  following  shall  constitute  good reason for  termination
hereof by Employee, but shall not in any way be deemed to limit any other rights
or remedies of Employee hereunder:

                 (i) the  assignment  to  Employee  of any duties  substantially
inconsistent  with the  duties  set  forth in  Paragraph  3 hereof  and with the
position  in  the  Company  that  Employee  held   immediately   prior  to  such
termination,  or a  significant  adverse  alteration  in the nature or status of
Employee's  responsibilities  or the conditions of such employment from those in
effect immediately prior to such termination;

                 (ii) a reduction by the Company in  Employee's  Salary or Bonus
Compensation  as in  effect on the date  hereof or as the same may be  increased
from time to time;

                 (iii) the relocation of the Company's offices at which Employee
is principally employed immediately prior to such termination to a location more
than 10 miles from such location,  or the Company requiring Employee to be based
anywhere other than the Company's  offices at such location  except for required
travel on the  Company's  business to an extent  substantially  consistent  with
Employee's business travel obligations immediately prior to such termination;

                 (iv) the failure by the Company to pay to Employee  any portion
of  Employee's  current  compensation  or to pay to  Employee  any portion of an
installment of deferred  compensation under any deferred compensation program of
the Company,  now or hereafter in  existence,  within seven (7) days of the date
such compensation is due;

                 (v) the failure by the Company to continue to provide  Employee
with benefits  substantially  similar to those enjoyed by Employee  under any of
the Company's life insurance,  medical,  accident,  disability or other employee
benefit or compensation  plans in which Employee was  participating  immediately
prior to such  termination,  the taking of any action by the Company which would
directly or indirectly materially reduce any of such benefits, or the failure by
the Company to provide  Employee  with the number of paid vacation days to which
Employee  is  entitled  on the basis of years of  service  with the  Company  in
accordance  with the Company's  normal  vacation policy in effect at the time of
such termination; or



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<PAGE>

                 (vi) a breach by the Company of any provision of this Agreement
not embraced in the foregoing clauses (i)-(v).

          12.  Company  Property.  (a)  Any  patents,  inventions,  discoveries,
applications  or  processes,   designs,   devised,  planned,  applied,  created,
discovered or invented by Employee in the course of Employee's  employment under
this  Agreement  and  which  pertain  to  any  aspect  of the  Company's  or its
respective  subsidiaries' or affiliates' business shall be the sole and absolute
property of the Company,  and Employee  shall make prompt report  thereof to the
Company and  promptly  execute any and all  documents  reasonably  requested  to
assure the Company the full and complete ownership thereof.

(b) All records, files, lists, including computer generated lists, drawings,
documents, equipment and similar items relating to the Company's business which
Employee shall prepare or receive from the Company shall remain the Company's
sole and exclusive property. Upon termination of this Agreement, Employee shall
promptly return to the Company all property of the Company in his possession.
Employee further represents that he will not copy or cause to be copied, print
out or cause to be printed out any software, documents or other materials
originating with or belonging to the Company. Employee additionally represents
that, upon termination of his employment with the Company, he will not retain in
his possession any such software, documents or other materials.

          13.  Remedy.  It is mutually  understood  and agreed  that  Employee's
services are special,  unique,  unusual,  extraordinary  and of an  intellectual
character  giving them a peculiar value,  the loss of which cannot be reasonably
or adequately  compensated in damages in an action at law.  Accordingly,  in the
event of any breach of this  Agreement by Employee,  including,  but not limited
to, the breach of the non-disclosure,  non-solicitation  and non-compete clauses
under Paragraph 11 hereof,  the Company shall be entitled to equitable relief by
way of  injunction  or  otherwise  in  addition  to damages  the  Company may be
entitled to recover. In addition, the Company shall be entitled to reimbursement
from  Employee,  upon request,  of any and all  reasonable  attorneys'  fees and
expenses incurred by it in enforcing any term or provision of this Agreement.

          14. Representations and Warranties of Employee. (a) In order to induce
the  Company  to enter  into this  Agreement,  Employee  hereby  represents  and
warrants to the Company as follows:  (i)  Employee  has the legal  capacity  and
unrestricted  right to execute and deliver this  Agreement and to perform all of
his obligations hereunder;  (ii) the execution and delivery of this Agreement by
Employee and the performance of his obligations hereunder will not violate or be
in conflict with any fiduciary or other duty, instrument,  agreement,  document,
arrangement or other  understanding  to which Employee is a party or by which he
is or may be  bound  or  subject;  and  (iii)  Employee  is not a  party  to any
instrument,  agreement,  document,  arrangement or other  understanding with any
person (other than the Company)  requiring or restricting  the use or disclosure
of any confidential  information or the provision of any employment,  consulting
or other services.



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<PAGE>

             (b)  Employee  hereby  agrees to  indemnify  and hold  harmless the
Company  from and  against  any and all  losses,  costs,  damages  and  expenses
(including,  without  limitation,  its reasonable  attorneys'  fees) incurred or
suffered  by the  Company  resulting  from any breach by  Employee of any of his
representations or warranties set forth in Paragraph 14(a) hereof.

          15. Notices. All notices given hereunder shall be in writing and shall
be deemed  effectively  given when mailed,  if sent by  registered  or certified
mail, return receipt  requested,  addressed to Employee at his address set forth
on the first page of this  Agreement and to the Company at its address set forth
on the first page of this Agreement,  Attention:  Chairman of the Board,  with a
copy to Jenkens &  Gilchrist  Parker  Chapin LLP,  The  Chrysler  Building,  405
Lexington Avenue, New York, New York 10174,  Attention:  Gary J. Simon, Esq., or
at such  address  as such  party  shall  have  designated  by a notice  given in
accordance  with this  Paragraph 15, or when actually  received by the party for
whom intended, if sent by any other means.

          16.  Entire   Agreement.   This  Agreement   constitutes   the  entire
understanding  of the parties with respect to its subject  matter and no change,
alteration or  modification  hereof may be made except in writing  signed by the
parties  hereto.  Any  prior  or other  agreements,  promises,  negotiations  or
representations  not  expressly  set forth in this  Agreement are of no force or
effect.  In furtherance  and not in limitation of the foregoing,  this Agreement
supersedes  any and all prior  employment  agreements to which  Employee and the
Company are parties,  including the Employment Agreement dated as of November 1,
1997 between Employee and the Company,  all of which prior agreements are hereby
terminated and of no force or effect.

          17.  Severability.  If  any  provision  of  this  Agreement  shall  be
unenforceable   under   any   applicable   law,   then    notwithstanding   such
unenforceability,  the remainder of this Agreement  shall continue in full force
and effect.

          18. Waivers, Modifications,  Etc. No amendment, modification or waiver
of any provision of this Agreement  shall be effective  unless the same shall be
in writing  and signed by each of the  parties  hereto,  and then such waiver or
consent  shall be effective  only in the specific  instance and for the specific
purpose for which given.

          19. Assignment.  Neither this Agreement, nor any of Employee's rights,
powers,  duties or  obligations  hereunder,  may be assigned by  Employee.  This
Agreement  shall be binding  upon and inure to the benefit of  Employee  and his
heirs and legal  representatives and the Company and its successors and assigns.
Successors of the Company shall include, without limitation,  any corporation or
corporations acquiring,  directly or indirectly, all or substantially all of the
assets of the  Company,  whether by merger,  consolidation,  purchase,  lease or
otherwise,  and such successor shall  thereafter be deemed "the Company" for the
purpose hereof.

          20.  Applicable Law. This Agreement shall be deemed to have been made,
drafted,  negotiated and the transactions  contemplated  hereby  consummated and
fully  performed in the State of New York and shall be governed by and construed
in  accordance  with the laws of the  State of New York,  without  regard to the
conflicts of law rules thereof.  Nothing  contained in



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<PAGE>

this  Agreement  shall be construed so as to require the  commission  of any act
contrary to law, and whenever  there is any  conflict  between any  provision of
this Agreement and any statute, law, ordinance, order or regulation, contrary to
which the  parties  hereto  have no legal right to  contract,  the latter  shall
prevail,  but in such event any provision of this Agreement so affected shall be
curtailed and limited only to the extent  necessary to bring it within the legal
requirements.

          21.  Jurisdiction and Venue. It is hereby  irrevocably agreed that all
disputes or  controversies  between the Company and Employee  arising out of, in
connection  with or  relating  to this  Agreement  shall be  exclusively  heard,
settled and determined by arbitration to be held in the City of New York, County
of New York, in accordance with the Commercial Arbitration Rules of the American
Arbitration Association then in effect. The parties also agree that judgment may
be entered on the arbitrator's  award by any court having  jurisdiction  thereof
and the parties consent to the  jurisdiction of any court located in the City of
New York, County of New York, for this purpose.

          22. Full  Understanding.  Employee represents and agrees that he fully
understands  his right to discuss all aspects of this Agreement with his private
attorney, that to the extent, if any that he desired, he availed himself of this
right, that he has carefully read and fully understands all of the provisions of
this  Agreement,  that he is  competent  to  execute  this  Agreement,  that his
agreement to execute this Agreement has not been obtained by any duress and that
he freely and voluntarily  enters into it, and that he has read this document in
its entirety and fully understands the meaning,  intent and consequences of this
document which is that it constitutes an agreement of employment.

          23.  Counterparts.  This  Agreement  may be  executed in any number of
counterparts,  each of which shall be deemed an original  and all of which taken
together shall constitute one and the same agreement.

          IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.

                                    NATIONAL HOME HEALTH CARE CORP.


                                    By: /s/ Robert P. Heller
                                        ---------------------------------------
                                        Name:   Robert P. Heller
                                        Title:  Chief Financial Officer and
                                                Executive Vice President

                                        /s/ Steven Fialkow
                                        -----------------------------------
                                                  Steven Fialkow



                                      -10-
<PAGE>



                        ADDENDUM TO EMPLOYMENT AGREEMENT:
                        ---------------------------------

              Business Policies of National Home Health Care Corp.
              ----------------------------------------------------


          This addendum supplements and is hereby incorporated into the terms of
the Employment Agreement to which this is attached. The Company has set forth in
this addendum basic  principles and standards of conduct that senior  management
of the Company are  expected to follow in all  respects.  Every  employee of the
Company has a personal  responsibility  to abide by each of the standards.  Each
person,  alone,  is  responsible  for his  actions.  No one will be permitted to
justify  an  illegal  act by  claiming  it was  ordered  by  someone  higher  in
management.  No one,  regardless  of level of position,  is ever  authorized  to
direct an employee to commit an illegal or unethical act.

          As a summary of basic  principles,  this addendum does not include all
the rules and  regulations  that  apply to every  situation.  The  absence  of a
specific  practice  or  instruction  covering a  particular  situation  does not
relieve an employee from exercising the highest ethical standards  applicable to
the circumstances.  If an employee has questions as to what the proper course of
conduct should be in any given  situation,  consult the Chairman of the Board of
the Company and the Company's legal counsel.

          Violations   of  the   guidelines   set  forth  below  can  result  in
disciplinary action, including dismissal, and possible criminal prosecution.

          Any reprisal against an employee who is good faith reports a violation
or suspected violation of law or company policies is strictly forbidden.

          1. It is the Company's  policy to comply fully with the law. We should
avoid even the  appearance of wrongdoing  and, at all times,  should conduct our
business according to the highest ethical standards.

          Since the Company is a home health care company,  there are many state
and federal law and regulation which affect and define the  responsibilities  of
each employee.  These laws and  regulations  must be adhered to at all times. If
there is ever any doubt on the part of an employee about the meaning of a law or
regulation  the employee must check with corporate  counsel or special  counsel.
The employee is responsible for designing,  implementing and monitoring  quality
control programs to assure that Company policies are being followed and that all
personnel are in compliance.  In connection with any compliance  program,  it is
vital that the employee be sure that no  falsification of records be allowed and
the employee must undertake to have programs  developed to assure that this does
not happen.



                                      -11-
<PAGE>

          2. The Company shall not tolerate any unfair  competition.  Additional
guidelines relating to this general policy are:

          -    do not  interfere  with  contracts  made  between  a  prospective
               customer and a competitor.

          -    never engage in commercial bribery.

          -    do not disparage a competitor's services.

          -    be accurate and truthful in all dealings  with  customers  and be
               careful not to  misrepresent  the state and qualify,  features or
               availability of our services.

          3. The  Company  awards  business  to  suppliers  solely on merit.  No
employee should have any relationship, financial or otherwise, with any supplier
or  competitor  that might be  construed as a conflict of interest or that might
even appear to impair his or her independent  judgment on behalf of the Company.
Gifts,  loans or any other thing of significant  value should not be accepted or
solicited, even indirectly.

          4.  Each  employee's  primary  obligation  is  to  the  Company,  and,
therefore,  any form of outside  activity  must be kept  totally  separate  from
employment  with the  Company.  no outside  activity  should  involve the use of
Company assets, materials or facilities.

          5. No employee  may use his or her position in the Company for outside
gain or benefit,  nor should any employee use property or other  confidential or
private confidential information in any outside activity.

          6. The law requires  that the Company's  books and records  accurately
and fairly reflect  transactions  in reasonable  detail,  and that the Company's
internal accounting controls provide reasonable assurances that:

          -    transactions are carried out in an authorized matter.

          -    transactions  have been  reported and recorded to permit  correct
               preparation  of  financial  statements  and to maintain  accurate
               records  of  assets.  Access  to  assets  is in  accordance  with
               management's authorization.

          -    inventories  of assets  are taken  periodically  and  appropriate
               action is taken to correct discrepancies.



                                      -12-
<PAGE>

          7. Every  employee who has control over  Company  funds is  personally
accountable for such funds. There are no exceptions to this rule.

          When spending Company money or personal money that will be reimbursed,
or requesting  services that will cause Company money to be spent,  the employee
involved should make sure the Company received proper value in return and should
be sure the expenditure is for a legitimate business purpose.

          Anyone  responsible  for the  handling  of  Company  revenue,  and the
associated records and materials, is accountable for their safe keeping.

          8. The Company  categorically  forbids the use of corporate  funds for
the support of political  parties or  candidates.  No employee is  authorized to
make or approve such a contribution.

          9. Company  business  records must always be prepared  accurately  and
reliably,  since they are of critical  importance to the  Company's  meeting its
financial, legal and management obligations.

          10.  Records  containing  personal  data on patients and the Company's
employees are  confidential.  As such, they are to be carefully  safeguarded and
kept current and accurate. They should be disclosed only to authorized personnel
having a "need to know" or  pursuant  to lawful  processes.  Should you have any
questions  about  disclosure,  consult with the Company's  legal counsel  before
disclosing.

          11. When a dishonest  act by an  employee is  discovered  it should be
reported immediately and directly to the Chairman of the Board of the Company.

          12. The Company  encourages  employees to participate in its future by
investing in its  securities.  However,  in trading in Company  securities  each
employee should be aware that it may be illegal (and possible result in civil or
criminal  penalties)  to buy or sell Company  securities  while in possession of
material non-public information about the Company.

          Material   information   can  be  anything   that  could  have  actual
significance  in an investors  decision such as  acquisition  plans,  dividends,
earnings, new contracts, products, major regulatory, court or legislative events
and major  management  changes or other business plans.  Employees aware of such
information  prior to its being  made  public,  should  not buy or sell  Company
securities until the information has been made public.

          Employees  should not trade in the securities of other  companies when
they know material non-public information about these companies which they learn
as part of their job. For example, an employee may learn that another company is
being considered for a major



                                      -13-
<PAGE>

contract or any other  information  which could have actual  significance  in an
investor's decision about the securities of the other company.

          Employees  should keep any such  information  about the Company or any
other  company  secret  and use it only  for  Company  purposes,  because  it is
unlawful to "tip"  others who may buy or sell such  securities,  even though the
tipper does not.

          Some  types of  trading  -- even if  innocent  -- could  appear to the
public and to public  officials to be based on the misuse of inside  information
concerning the Company.  To avoid even an appearance of  impropriety,  employees
are not to engage in short term speculation in company  securities (that is, the
purchase and sale on the open market within a six month  period).  Nor should an
employee  engage in any  transaction  when he stands to profit  due to the short
term savings in the value of the Company's  securities.  An example of this type
of trading includes "short sales" (selling borrowed  securities which the seller
hopes can be purchased at a lower price when they are due for deliver.




                                      -14-