If you want your business to be legally compliant, you must follow federal and state employment laws. California employers should know about the recent court case, Ward v. Tilly’s, Inc., and how it affects paying for on-call time. Read on to learn about California on-call laws.

A brief recap on federal on-call pay laws

Some employers require employees to be on-call. On-call time is when an employee must be available in case their employer needs them to work.

In some cases, employers must compensate non-exempt employees for on-call time. However, on-call time is not always considered FLSA hours worked.

On-call employees might be restricted to waiting around at the business or near it. In these cases, you may need to pay the employee for on-call time. For example, a doctor may need to remain at the hospital. Or, an employee might not be able to engage in personal activities while on-call.

Some employers can determine whether they want to pay employees for on-call time not governed by the Fair Labor Standard Act (FLSA).

Depending on the situation, federal law might not require you to pay employees for on-call time. But, your state might. So, what are the California on-call pay requirements?

On-call pay: California

On February 4, 2019, the court case Ward v. Tilly’s, Inc., revamped how employers must compensate employees for on-call time. California on-call pay requirements now include employees calling to find out whether they are working or not, even if they aren’t required to work.

Prior to the February ruling, California employers thought they were only required to pay employees when they physically reported for work. But now, “reporting to work” also encompasses employees who report over the phone.

According to the court ruling, on-call shifts are inconvenient for employees because they:

• Require the employee to make last-minute arrangements (e.g., childcare)
• Prohibit the employee from securing supplemental employment
• Prevent the employee from enjoying personal activities
• Do not offer financial security if the employee is not required to work

A closer look at Ward v. Tilly’s, Inc.

What happened in Ward v. Tilly’s, Inc.?

Tilly’s, a retail store, required employees to call in two hours before their on-call shift to find out if they had to work.

In some cases, the employees were scheduled to work directly after the on-call shifts. Or, the employees worked regular shifts followed by on-call shifts. In other cases, the employees were not scheduled for regular hours on days they had an on-call shift.

The retail store did not compensate employees for on-call time if the workers did not have to work. After a Tilly’s employee challenged the store’s policies, the court found that their scheduling system was a burden for employees.

The Tilly’s employee, Skylar Ward, argued that California’s Wage Order 7 requires employers to pay nonexempt retail employees for reporting, even by telephone, if one of the following is true:

• An employee is required to report for work and does report, but is not put to work or is furnished less than half of their usual or scheduled day’s work
• An employee is required to report for work a second time in any one workday and is furnished less than two hours of work on the second reporting (e.g., a regular shift and an on-call shift)

The court ruled against Tilly’s for not compensating employees. California employers must either fix their scheduling systems or compensate employees for on-call shifts if the employee calls in.

The effects of California on-call laws

Do you use a call-in schedule in your California business? If so, you need to review your company’s policies.

You might decide to change your scheduling system so employees know ahead of time whether they’re working or not. Or if you continue requiring employees to call in, you likely need to provide on-call pay.

Looking to streamline the way you pay employees? Try Patriot Software’s online payroll. Take the stress out of running payroll with our easy three-step process. Get your free trial now!

This is not intended as legal advice; for more information, please click here.