Do you require employees to be on call? If so, it’s critical to
understand the rules about when you have to pay for on-call time. A new
case provides some insight into when this time must be compensated.
Resident Managers Must Stay Within Earshot of
Apartment
Ron and Sharon Isner, a married couple, were the resident managers
at a housing complex for the elderly in
California
Falkenberg/Gilliam & Associates, Inc., and had to live on the complex
premises.
The employment agreement stated that the Isners worked daytime
hours Monday through Friday and were on call to respond to the facility’s
emergency alarm systems on weekdays from 5:00 p.m. to 8:00 a.m. and on
designated weekends from 5:00 p.m. Friday to 8:00 a.m. Monday. While on call,
they had to remain within hearing distance of the alarm and telephone, but they
were otherwise free to use their time as they chose. All time spent responding
to emergencies was to be counted as hours worked and paid; however, the Isners
weren’t otherwise to be paid for on-call time.
When on call, staying within hearing distance of the alarm and
phone meant that the Isners had to stay within earshot of their apartment, as
the alarm and phone weren’t audible to them if they were, for example, at the
pool or walking around the complex. This meant, too, that they couldn’t go to a
movie or shopping together.
The Isners had to fill out time sheets to get paid, and they had
to note their normal eight-hour workday along with time spent responding to
emergencies. Although the Isners chose to record only those emergencies that
took 15 minutes or longer, they understood that they should record all such
time.
The HR Management & Compliance Report: How To Comply with California Wage & Hour Law, explains everything you need to know to stay in compliance with the state’s complex and ever-changing rules, laws, and regulations in this area. Coverage on bonuses, meal and rest breaks, overtime, alternative workweeks, final paychecks, and more.
Suit Filed for Unpaid On-Call Time
When the Isners left their jobs with Falkenberg after five and a
half years, they sued for unpaid wages for all the time they spent on call
(excluding the time spent responding to emergencies, for which they had been
compensated). They contended that because they weren’t free to use their
on-call time as they chose, but were instead tethered to the apartment, all of
that time counted as hours worked.
Falkenberg asked the trial court to throw out the suit, arguing
that it had to pay the Isners only for hours they actually performed duties
during their on call time. The trial court sided with the employer, and the
Isners appealed.
Pay Depends on Restrictions
Now a
appeals court has upheld the lower court’s ruling, finding that the Isners had
no valid claim for unpaid wages.1
The court explained that the Isners’s employment was governed by
Wage Order 5 (Public Housekeeping Industry). That Wage Order defines hours
worked as “the time during which an employee is subject to the control of an
employer, and includes all the time the employee is suffered or permitted to
work, whether or not required to do so, and in the case of an employee who is
required to reside on employment premises, that time spent carrying out assigned duties shall be counted as hours worked.”
The central dispute in the case, said the court, concerned whether
all of the Isners’s on-call time was “time spent carrying out assigned duties.”
The court pointed out that prior court decisions and the California Division of
Labor Standards Enforcement have taken the position that resident employees who
must be on-call are entitled to pay only for on-call time spent performing
physical, mental, or other specified tasks. In one case, a court ruled that a
motel clerk who had to remain on the premises 24 hours a day was entitled to
pay only for time he provided guest or other services. When the clerk wasn’t
performing services, he was free to use his time as he chose.
The court here found the Isners’s situation similar to the motel
clerk’s. The requirement that the clerk be available to provide guest services
was analogous to the requirement that the Isners remain within audible range of
the alarm and phone. The appeals court also pointed out that the Isners were
free to switch their schedules with other resident managers who worked at the
complex, so they could leave the premises as long as other arrangements were in
place.
Factors to Consider
This new decision confirms that in the case of workers who must
reside at their place of employment, on-call time counts as hours worked only
when work duties are performed, but the employee must otherwise be free to
pursue personal activities during the on-call time.
More generally, for any employee, the key to whether on-call time—sometimes
referred to as “standby” time—must be compensated will depend on the degree of
freedom the employee has for personal pursuits. The more control the employee
has, the less likely that the time must be paid. Factors courts consider in
determining the degree of an employee’s control include: 1) whether the on-call
waiting time is substantially similar to regular on-duty work; 2) the frequency
of calls or other interruptions; 3) whether a fixed time limit for responding
restricts personal pursuits; 4) geographical restrictions imposed on the
employee; 5) whether an employee actually engages in personal activities on
these shifts; and 6) the employee’s ability to trade on-call shifts.
6
Reasonable Agreements
Finally, Sandra Rappaport, an attorney with the San Francisco
office of law firm Hanson Bridgett, LLP, points out that federal wage and hour
law, which wasn’t raised in this case, honors “reasonable agreements” between
employers and resident employees as to how much time will be considered hours
worked (and thus compensable). Therefore, to help defend your practices in the
event an employee sues you under federal law, make sure that employment
agreements with resident employees spell out which time will and will not be considered
hours worked.
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1 Isner v. Falkenberg/Gilliam & Associates, Inc.,
(Dist. 2) No. B195860, 2008