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Employees Must be Paid When Required to Call-in for Shifts

Under California labor laws and applicable Wage Orders issued by the Department of Industrial Relations, if an employer requires an employee to “report for work” that employee must be paid. See Wage Order 7; Cal. Lab. Code §§ 200-203, 226, and 226.3; Cal. Bus. & Prof. Code, §17200. Payment is required even if the employee is not actually given any work to do or if the employee is given less that his or her usual or scheduled shift. For example, if your San Diego construction company has 10 workers for a given shift or job and you require them to be at the construction site on Friday morning at 6 am, your business will have to pay them for showing up. This is true even if you only have enough work for six workers. If you send the extra four workers home, you will owe them wages for half the usual shift (no more than four hours and no less than two hours of wages).

This has been the law in California for a long time and most employers know this rule and understand it, and the rule has some justification. Getting to a job site takes time and money — if only the cost of gasoline. There is also the lost opportunity for the worker who might have some other job opportunity that could have been taken.

The law has not quite caught up to technology. With the advent of phones and cellular phones in particular, workers do not need to actually show up at the work site to find out if they will have work to do. Indeed, for many years, employers have been using phone service in this manner. Call in a certain number of hours before your shift; if we have work, then show up; if not, then stay home. Until a recent California Court of Appeals decision, these “call-in” requirements were not considered a form of “report-to-work” that triggered payment obligations. That has now changed. See Ward v. Tilly’s Inc., Case No. B280151 (Cal. App. 2nd Dist. February 4, 2019).

As most of us know, Tilly’s is a clothing, apparel, and housewares store based in Irvine, California. They have locations across California and the US. In 2012, a sales clerk named Skylar Ward worked at the Tilly’s store in Torrance, California. For many years, Tilly’s has used a combination of actual shift and “on-call” shift scheduling. That is, some shifts are given to employees and they are expected to be there on time; other shifts are given based on need and the employees are instructed to call in two hours before the shift to be told whether to show up physically at the store. Employees were told by Tilly’s that they were to “consider an on-call shift a definite thing until they are actually told they do not need to come in.” Employees were not, however, paid any wages if they called in and were told to stay home.

In 2015, Ward sued Tilly’s alleging that she and other employees should be paid as though they were “reporting to work” under Wage Order 7. Ward argued that on-call shifts should be considered the same as “report-to-work” shifts because the public policy issues underlying Wage Order 7 are just as much implicated. On-call shifts are just as disruptive as “report-to-work” shifts. Among the adverse impacts, on-call shifts:

  • Preclude other employment choices
  • Interfere with other choices such as education classes, training, and leisure activities
  • Force employees to expend costs for various tasks like childcare
  • Tamper with health issues such as sleep schedules
  • Impact other family members who may be providing transportation
  • And more

In a 2-1 decision, the California Court of Appeals agreed with Ward and held that such “on-call” shifts were subject to the pay requirements of Wage Order 7. Some have suggested that the California Supreme Court might reverse and that is possible. As we discussed here, the California Supreme Court has recently issued opinions supportive of employees. The Dynamex case can also be placed in this category.

Legal lesson for San Diego employers

For now, it is time to modify any type of “on-call” scheduling unless you are prepared to pay the “report-to-work” wages as required. One unanswered question from the Ward case is how long in advance of the actual shift the call has to be made to trigger Wage Order 7. Tilly’s had its workers call two hours in advance. That was short enough to trigger the Wage Order payment requirement. How about 24 hours in advance? Unknown. In theory, the same “costs” to the employee are encountered by a 24-hour “call-in” in terms of daycare, transportation, lost employment, and education opportunities. Presumably, there is an outer limit, but that limit is unknown for now.

Contact San Diego Corporate Law Today

If you would like more information, contact attorney Michael Leonard, Esq., of San Diego Corporate Law. Mr. Leonard can be reached at (858) 483-9200 or via email. Mr. Leonard can help with employment-related matters such as employment contracts, drafting and/or reviewing company employee policies and procedures, creating and/or updating employee handbooks, and more. Like us on Facebook.

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