It is a fairly common practice for companies to have non-exempt employees available by phone at the drop of a hat to respond to emergencies and other unexpected business needs. Yet, if the employee doesn’t actually respond to any phone calls or do anything during that time period, is the company still required to pay them for the mere possibility that their services may at some point be needed?
Any time during which employees are subject to control by the company may be “hours worked,” even though the employees don’t actually perform any work and possibly even if they are able to spend the time doing whatever they choose.
So how do companies know if the employee is under their “control” during on-call/standby time? Like many other areas of California employment law, whether the answer to this question is yes or no turns on the employee’s specific situation.
There have to be some general rules, right? Non-exempt employees may be on-call during unscheduled work hours to respond to calls for help from work. On-call time can be either controlled or uncontrolled, depending on how restricted the employee is in being able to utilize the time for personal pursuits.
To be controlled or uncontrolled: That is the question. Of course, because this is California, there is no hard and fast rule about how many times an employee’s day or evening must be interrupted or for how long that interruption can last before all of the on-call time (not just the time the employee spent dealing with the interruption) rolls into the controlled category as opposed to uncontrolled. Factors that are considered include:
- How soon do you need me to call back? (if less than a 20 minute response time to return to the workplace, the time could be contended to be controlled);
- Can I go where I want? For example, does the need to physically show up to a company’s workplace to respond to an emergency restrict where the employee can live and where they can visit friends and family? If the employee needs to live relatively close to the company and cannot be more than a short drive away at any time, the on-call time is probably controlled;
- Can I do what I want? For example, can the employee go to dinner with friends and family and toss back a cocktail at dinner? If the employee cannot have any alcohol due to the potential nature of any emergency and the need to physically respond at the company’s workplace, the time conceivably could be controlled;
- How many times can I expect you to bug me? For example, if an employee is being interrupted every 10 minutes with a call during their unscheduled work hours, it is probably controlled on-call time. However, if the employee is interrupted only once or twice for brief calls in a 4-hour hour period, the time in between the calls is probably uncontrolled;
- Can I swap? If the employee is the only one who is capable of responding to any potential emergencies for the employer and cannot trade days that he or she is on-call, this could be a factor influencing the decision as to whether the time is controlled.
The factors described above require a fact specific inquiry to determine whether an employee’s on-call time is controlled.
Maybe I’ll just pay. But how much? All actual time worked by an employee during the on-call period (such as taking a work related phone call or responding to a customer concern over e-mail) is time worked and the hours on those tasks must be included in the overtime calculation.
But what about the time that employee is actually not doing any work? It depends. All controlled on-call time must be compensated, but may be paid at a lower than usual rate of pay (but not less than minimum wage). Controlled time is considered time worked and included in calculating overtime (if at a different rate, this will result in a blended rate overtime calculation for those workweeks), and if an employee is required to go to the office while on controlled on-call time, all travel time to and from the office must be paid.
On the other hand, uncontrolled on-call time is not required to be compensated at all. However, if the on-call time is uncontrolled and unpaid, and if the employee has to return to work for the second time in one day outside of their ordinarily scheduled hours, he/she gets a minimum of 2 hours pay as Reporting Time Pay. Yet, just to make things more confusing, only the time actually worked by the employee is included in overtime calculation.
Workplace Solutions: Employers can reduce the likelihood that they need to pay employees for on-call or standby time by decreasing the amount of control they have over employees while they are on call. If possible, the employer should let the employee trade their on-call time with other employees, provide a reasonable amount of response time, and limit the number of any calls to matters of importance. If that is not possible, employers need to be aware of the potential need to pay employees for on-call time, as well as for any resulting overtime pay and blended rate implications.
Edited by Chelsea Mesa