Why it matters

On-call scheduling remains a target of regulators and workers alike, with new suits filed challenging the practice and a recent deal between the New York Attorney General and an employer agreeing to end its use. Forever 21 and BCBG Max Azria were both the targets of complaints in California state court recently, alleging that the retailers fail to compensate workers for the time spent on call when they do not end up working. The on-call shifts are no different from regular shifts and employees should be paid accordingly, the plaintiffs claim, calling the practice of on-call scheduling a “new form of wage theft.” New York’s Attorney General has focused on the practice as well. Earlier this year, AG Eric Schneiderman sent letters to several major retailers and launched an investigation into possible violations of labor law. A number of national retailers have since agreed to stop using the practice. Joining the list earlier this month, Urban Outfitters promised to start providing employees notice of their schedules at least one week before the start of the workweek. Given the scrutiny from regulators and employees alike, employers may want to think twice before making use of on-call scheduling.

Detailed discussion

Should workers who are required to be “on call” for a shift be paid for their time? According to two new lawsuits filed in California state court by workers in the retail industry, the answer is “yes.”

Raalon Kennedy and Robynette Robinson alleged that Forever 21 and BCBG Max Azria, respectively, owe employees for on-call shifts even if they don’t end up working. “On-call shifts, like regular shifts, also have a designated beginning time and quitting time,” Kennedy wrote in his complaint. “In reality, these on-call shifts are no different than regular shifts, and Forever 21 has misclassified them in order to avoid paying reporting time in accordance with applicable law.”

Under California law, employers must pay nonexempt employees “reporting time” pay when they are required to report to work but do not end up working or work less than half of the scheduled day. Both Kennedy and Robinson alleged that they were never paid for reporting time and argued that being on call limited their chance to work a second job or plan activities.

Characterizing missing payment for on-call shifts as “a new form of wage theft,” the suits claim that employees are also penalized for missing on-call shifts or being late. “Unpredictable work schedules take a toll on all employees, especially those in low-wage sectors,” Robinson alleged in her complaint.

On the other coast, the State of New York is pursuing an action against employers utilizing on-call schedules. New York Attorney General Eric T. Schneiderman launched an investigation into the practice earlier this year, sending letters to 13 major retailers to ask how they set workers’ schedules. Recipients were also cautioned that use of on-call scheduling could violate state law.

Schneiderman said New York regulations require that employees who report for work on any day must be paid for at least four hours, or if the shift is less than four hours, at least minimum wage. The investigation was triggered by a rising number of calls to the AG’s office by employees complaining that they were not being paid accordingly, he said, particularly in the retail industry.

Some employers responded by agreeing to stop the practice. Urban Outfitters recently promised to halt the practice in its New York stores with a phase-in process starting in November. The company also stated that it would provide employees with their schedules at least one week prior to the start of the workweek.

“Workers deserve basic protections, including a reliable work schedule that allows them to budget living expenses, arrange for childcare needs and plan their days,” Schneiderman said in a statement announcing the latest agreement. “I commend Urban Outfitters for taking this important step to ensure that their employees have schedules that are more predictable.”

In addition to California and New York, six other states—Connecticut, Massachusetts, New Hampshire, New Jersey, Oregon, and Rhode Island—as well as Washington, D.C., have laws on the books mandating reporting time pay.