On-Call Workers: Does FLSA Make You Pay Them to Wait?

Under the Fair Labor Standards Act (FLSA), you have to pay on-call workers as they wait. Well, sometimes, anyway. Here are the criteria.

The week between Christmas and New Year’s is traditionally a “stand-down” time at many businesses. A lot of employees choose to use this week to burn off remaining vacation time rather than lose it with the turn of the calendar. Offices often take on the aura of ghost towns. And even the normally frenetic stock exchanges close early.

Of course, business doesn’t really stop. Equipment still needs to run, and customers need to be served, so one solution often utilized is to have key employees “on-call,” bringing them in only if needed. That especially applies to technicians and customer service people, who are often nonexempts and have to be paid for every hour devoted to the job, even if after hours.

The question is how to legally pay these people. As they wait to be needed, are they working or are they not? Under the FLSA, do they need to be paid as they wait? Indiana employment law attorney James Jorgensen, writing at NWITimes.com, and other sources, have sought to flesh out the rules.

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The key element, says Jorgensen, is how much freedom on-call people have to live their personal lives, going where they want and doing what they want, as they wait. Here are the key criteria:

–Geography. How far can an on-call worker stray from the jobsite? The more restricted he or she is, the more likely it is that on-call time is compensable. Before cell phones and pagers, on-call people often had to be at home, by the phone. Now they can be anywhere, so the issue is less clear. That often brings it down to a matter of …

–Response Time. How long a time do you allow for on-call people to respond? That frequently spells how far away they can be. If you demand the person be on-site in 10 minutes, says Jorgensen, the time is likely to be compensable. If it’s 60 minutes, he believes the opposite is true.

–Call Frequency. How often is the person actually called? In one court case, Jorgensen reports, an employee called three to five times a day was ruled to be working and had to be paid. In another case, one called six times in a year was not deemed so.

–Uniqueness. A fourth factor relates to how many of your workers can do the needed work. If there’s a pool of employees available, and employees can trade off the on-call responsibility, there’s less evidence that any one of them is restricted personally.

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Finally, is there an agreement between you and the worker about on-call responsibility … one that states your desire for them to have maximum freedom when not at work? The more you seem willing to let employees use their off-hours as they please, the less likely it is that you’ll wind up paying for them.