For employees of Tilly’s, a clothing store, each work week consists of both scheduled shifts and what the company called “on call shifts.” For these on call shifts, employees are required to call their respective store two hours in advance of the on call shift, and during that call the employees are informed whether they are required to work the shift or not. In September of 2015, a Tilly’s employee filed suit against Tilly’s claiming these required call-ins for on call shifts were a violation of Wage Order 7.
Wage Order 7 requires that any employee who reports to work and is not then put to work, or is only assigned to work half of the employee’s scheduled shift, be compensated for half of the scheduled shift. For example, if an employee is scheduled to work from 12 p.m. to 4 p.m., and reports to work but then is sent home without working at least two hours, the employee will be compensated for two hours. This Order was adopted in order to compensate employees for the “tremendous costs” of unpaid on-call shifts. The Court of Appeal found that, “in short, on-call shifts significantly limit employees’ ability to earn income, pursue an education, care for dependent family members, and enjoy recreation time.”
The Tilly’s employee argued that by calling in to be told whether to report for the scheduled on call shift, the employee was “reporting” for work, which required the employee to be paid for at least half the scheduled time of the shifts for which the employee was ultimately told not to work. Tilly’s, on the other hand, argued that “reporting” for work meant physically presenting oneself for a shift, meaning that such an employee would actually need to physically show up at the store for his or her shift to be paid “reporting time” pay. Under Tilly’s definition of “reporting,” calling the store two hours before the on call shift would not be sufficient to trigger a duty to pay.
The trial court agreed with Tilly’s and sustained Tilly’s demurrer to the employee’s complaint; however, the Court of Appeal disagreed with Tilly’s. The Court of Appeals found that while Wage Order 7 had been adopted in current form in 1979, long before the concept of an on call shift came to be, the situation this order originally intended to cure mirrored that which presented itself in this case. Originally, the order was enacted to achieve a two part goal: to properly compensate employees and to encourage proper notice and scheduling.
The Court of Appeals found that by requiring its employees to call in two hours before the start of on call shifts, Tilly’s significantly hindered the employees’ activities not only during the on call shift itself, but also two hours before. Because of this significant hindrance, caused by Tilly’s ineffectively scheduling its employees’ shifts, the Court held Wage Order 7’s dual goals would be achieved. First, by requiring Tilly’s to pay reporting time for employees calling in to confirm on call shifts, Tilly’s would be required to internalize some of the costs of overscheduling. Second, by requiring this compensation, Tilly’s will be partially compensating employees “for the inconvenience and expense associated with making themselves available to work on call shifts.”
Importantly, both Wage Order 7 and the Court of Appeals are careful to note that this compensation is only owed to those employees who are required to call in to confirm on call shifts, but are told they are not needed for the shift. Those employees who call in to confirm, and are told to come in and work the shift need only be compensated for their actual hours worked. So long as employees work at least half of the scheduled shift, they need only be compensated for their hours worked.
If your company has an on call policy similar to Tilly’s where employees are scheduled for potential shifts and required to call in hours before those shifts to confirm them, you may be required to comply with these reporting time rules. Call the attorneys at Navigato & Battin to discuss this further.