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Reducing an Employee's Wages for Non-productive Hours: On-Call Employment (Part 1 of 3)


Posted on 8/29/2018 by Michael Zamora
Meetings, trainings, travel, and even on-call time can and will be incurred at some point in your businesses quest to deliver optimum service. This often leaves employers asking themselves two important questions: (1) Am I required to pay an employee for time spent training? And (2) If so, how much?

On-Call Employment

An employee “engaged to wait” is generally considered to be working under the Federal Labor Standards Act (FLSA), and therefore entitled to compensation. Alternatively, an employee who is simply “waiting to be engaged” is generally not considered to be working. While the distinction may be obvious in some cases, in others it is not easy to determine whether an employee is “on the clock” for the purpose of calculating the number of hours worked. Thus, it is important to examine the nature of the time spent waiting. One good test is to consider the control you have if someone did not tend to an on call task. For example, if you have an employee who answers emergency phone calls during times the business is closed, are they subject to discipline if they do not answer the phone? Are they required to refrain from engaging in any activities that may impair their ability to perform their duties, such as alcohol consumption? Do they have to respond within a certain time frame? Or, are these tasks executed at the discretion of the employee?

Another issue is communication during an employee’s off time. When an employee is off the clock, they have no obligation to reach back to you or communicate with the practice. Although it may be difficult, it is important you realize that as a business owner you may have an “always on” mentality; but your employees may not.

In short, the more constraints an employee has, the more likely it is that the ‘on-call’ time is compensable. Should you find that you do in fact need to compensate your staff for their time spent “waiting to be engaged,” you do have the option to pay the waiting time at a reduced rate, which will be explored further in this article. (See Non-productive Work, Reduced Wages and Overtime)

Implementing a reduced non-productive wage is very complex. It’s imperative that you take the proper steps to outline a detailed policy that protects you from future employment claims. For assistance implementing a non-productive reduced wage, contact an employment law attorney or HR professional.
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