California Appellate Court Requires Employers To Provide Reporting Time Pay for On-Call Shifts
A recent decision by the California Appellate court could have a major effect on small businesses that use “on-call” reporting or similar means of scheduling employee shifts.
Wage Order 7Under California's Wage Order 7, which applies to any mercantile business and requires employers to pay employees "reporting time pay" when they are required to report for work, but work less than half a shift. The Order defines reporting time pay as pay for half the employee's regular work day, but no less than 2 and no more than 4 hours.
Skylar Ward v. Tilly's, IncIn Skylar Ward v. Tilly's, Inc. the 2nd District Appellate Court concluded that on-call scheduling triggers reporting time pay requirements under California*s Wage Order 7.
In Skylar Ward, the Defendant's stores required the Plaintiff and other employees to contact their respective stores within two hours before the start of their "on-call" shifts to determine whether they needed to work those shifts. The Defendant told employees to consider their shifts a "definite thing" until they were otherwise told not to report and disciplined employees who failed to timely contact their respective stores. However, the Defendant did not include these "on-call" shifts in the calculation of employee wages unless the employees were required to actually show up and work.
The Court concluded that such telephonic call-in requirements should trigger reporting time pay because otherwise there is no incentive for employers to competently anticipate their labor needs and schedule accordingly. Such practices enabled employers to keep labor costs low, but harmed employees. During on-call periods, employees could not commit to other jobs, schedule classes, etc. Because whether they actually work remains uncertain until shortly beforehand, if they do not end up working, employees are not compensated for these sacrifices and their activities are otherwise constrained.
Accordingly, California law holds that an employee need not physically appear at her workplace to "report to work." Instead, reporting within the meaning of Wage Order 7 is "presenting oneself as ordered." Thus, employers who use an on-call system may be required to provide "reporting time pay."
Do you have questions about how this or other California law can affect your small business? Contact an attorney today.