Court of Appeal Rules That On-Call Workers Are Entitled to Reporting Time Pay

By: Kerri N. Polizzi

On February 4, 2019, a panel of the California Court of Appeal held in Ward v. Tilly's, Inc., that certain on-call scheduling practices require employees to "report to work" within the meaning of the Industrial Welfare Commission ("IWC") Wage Orders, triggering compensation requirements even when no work is actually performed.

The case concerned employees of Tilly's, Inc. ("Tilly's") who were assigned "on-call" shifts that required time to call in two hours before their scheduled start time to determine whether they were actually required to come in to work that day. If the worker was in fact called in to work, Tilly's paid them for the entire shift. If, however, the employee calling in was told not to come in for the shift, he or she was paid nothing.

The plaintiff filed a putative class action alleging that this practice violated the reporting time pay requirement of the applicable IWC Wage Order. This requirement states that employers must pay reporting time pay for each workday in which "an employee is required to report to work and does report, but is not put to work or is furnished less than half of said employee's usual or scheduled day's work." Cal. Code Regs., tit. 8, § 11070, subd. (5) (emphasis added). Based on this single allegation, the plaintiff sought damages for unpaid wages, waiting time penalties, failure to provide accurate itemized wage statements, and unfair business practices.

The employer prevailed on a demurrer at the trial court level based on its argument that employees "report for work" only by physically appearing at the work site for a scheduled shift. The trial court agreed, finding that employees do not report to work without the meaning of the Wage Order "by merely calling in to learn whether an employee will work a[n] on-call shift."

The Court of Appeal, however, disagreed, finding that on-call scheduling practices used by Tilly's burden employees, who cannot engage in other activities like other employment, school, or social plans during on-call shifts. The court reasoned that it would be unfair to require employees to assume this burden without any compensation for the shifts unless they were actually called in to work.

The court first found that whether the phrase "report for work" requires an employee to be physically present was not obvious from its plain language. Instead, the court resorted to the purposes behind the reporting time requirements, which it found to be (1) compensating employees and (2) encouraging proper notice and scheduling. To further these goals, the court found that "report to work" must include any situation in which an employee presents him or herself for work in any manner directed by the employer.

The case has been remanded to the trial court for further proceedings, leaving several questions unanswered. Given the prevalence of on-call scheduling practices in California, this case is sure to impact businesses state-wide. Employers with on-call scheduling policies should immediately review these policies with their counsel to determine whether reporting time pay must be paid to on-call employees.

If you have any questions regarding the Tilly's case and/or your on-call scheduling practices, please feel free to give us a call. Kerri N. Polizzi is an Associate of Kring & Chung, LLP. She can be reached at (949) 261-7700 or via email at kpolizzi@kringandchung.com.

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