In an attempt to restrict employers’ use of flexible scheduling practices, the New York State Department of Labor (DOL) recently issued, for the second time, proposed regulations that would expand when covered employers must pay non-exempt employees call-in pay and impose new obligations on covered employers to pay non-exempt employees for unscheduled shifts, cancelled shifts, on-call time and call-for-schedule shifts. The DOL issued the first proposed regulations in November 2018, but decided not to adopt them as initially issued after conducting several public hearings and considering comments from the public. After apparently taking into account the responses it received, the DOL issued revised proposed regulations in December 2018. The proposed revised regulations are open to public comment until January 11, 2019, after which it is expected that the DOL will formally adopt them in the first quarter of 2019. If adopted, the proposed regulations will not only significantly reduce the ability of employers to use flexible scheduling, but will also greatly increase the associated costs and administrative burden.
Currently, non-exempt employees of covered employers who report to work on any day must be paid “call-in” pay equal to the lesser of four hours of pay, or the hours of pay in the employee’s regularly scheduled shift, at the State minimum wage rate. Thus, if an employee is sent home for lack of work after reporting to work, the employee is entitled to a minimum amount of “call-in” pay for the day. The current regulations cover virtually all private employees, except those employed in the building services and hospitality industries, and farm workers. As interpreted by the DOL in a 2006 opinion letter, which remains valid, the current regulations do not require any payment of call-in pay if an employee’s total wages for the workweek exceed the minimum wage rate and the overtime rate (based on one and one-half times the minimum wage rate) for the number of hours worked, plus the minimum wage rate for any call-in pay otherwise owed. Thus, the current regulations allow any call-in pay owed to be offset against an employee’s other wages.
Changes Caused by the New Proposed Regulations
If adopted, the proposed new regulations will bring about the following changes to call-in pay and scheduling practices:
- Reporting to Work: An employee who reports to work for any shift (rather than on any day as currently required), will have to be paid minimum wage pay for at least four hours or, if the regularly scheduled shift is less than four hours, the employee will have to be paid minimum wage only for the hours in the regularly scheduled shift.
- Unscheduled Shifts: An employee who reports to work for a shift not scheduled at least 14 days in advance of the shift will have to be paid an additional two hours of call-in pay at the minimum wage. (Where a weekly schedule is provided, the 14-day period may be measured from the last day of the schedule.)
- Cancelled Shifts: An employee whose shift is cancelled within 14 days before the start of the shift will have to be paid two hours of call-in pay at minimum wage. An employee whose shift is cancelled within 72 hours of the start of the shift will have to be paid at least four hours of call-in pay at minimum wage or, if the regularly scheduled shift is less than four hours, the employee will have to be paid minimum wage only for the hours in the regularly scheduled shift.
- On-Call: An employee who is required to be available to report to work (“on-call”) will have to be paid for at least four hours of call-in pay at minimum wage.
- Call for Schedule: An employee who is required to be in contact with the employer within 72 hours of the start of the shift to confirm whether to report to work will have to be paid at least four hours of call-in pay at minimum wage.
An employee must be paid his or her regular or overtime rate of pay, whichever is applicable, for time of “actual attendance.” Payments for other hours of call-in pay are calculated at the basic minimum hourly rate with no allowances, and such payments are not hours worked for purposes of determining overtime pay. The proposed regulations also prohibit offsetting call-in pay with leave time or payments to employees in excess of those required by the regulations.
What Exceptions Apply?
- Wages 40 Times Minimum Wage: In any week in which an employee’s wages exceed 40 times the applicable minimum wage rate, the employee would be exempt from all of the on-call pay requirements, except the call-in pay requirement for reporting to work.
- Collective Bargaining Agreement: Employees covered by a valid collective bargaining agreement that expressly provides for call-in pay would not be entitled to call-in pay under the regulations.
- Weather-Dependent Jobs/Health or Safety/Work Orders: Employees whose duties are directly dependent on weather conditions, or are necessary to protect the health or safety of the public or any person, and employees whose assignments are subject to work orders or cancellation thereof, would be exempt from call-in pay, so long as their weekly compensation exceeds the number of compensable hours worked times the applicable minimum wage, with no allowances. However, this exception would not apply to call-in pay for reporting to work.
- New Employees: The call-in pay requirement for an unscheduled shift would not apply to any new employee during the first two weeks of employment.
- Volunteers: The call-in pay requirement for an unscheduled shift would not apply to any employee who volunteers to cover a “new shift” or a “previously scheduled shift.” The proposed regulations define a “new shift” as “the first two weeks of an additional shift that results in a net increase in staffing at a single workplace during the period of time covered by such shift.” A “previously scheduled shift” is defined as a “shift that would not have been subject to unscheduled call-in pay if worked by the employee who was originally assigned to work that shift.” An employee would be considered a “volunteer” only if he or she could refuse to cover the new or previously scheduled shift. The proposed regulations include a “safe harbor” provision that would create a rebuttable presumption that an employee has volunteered if the employer has provided a written good faith estimate of hours to all employees, and the request to cover the shift is made by the employee whose shift would be covered, or by the employer in a written communication to a group of employees requesting a volunteer from among the group and identifying a reasonable deadline for responses. If no employee were to volunteer prior to the deadline, the employer would be allowed to assign an employee to cover the shift without paying call-in pay required for unscheduled shifts.
- Employers’ Response to Weather or Travel Advisories: Call-in pay for unscheduled and cancelled shifts would not be required when an employer offers employees the option to reduce or increase their scheduled hours by voluntarily staying at home, arriving early, arriving late, departing early, departing late or any combination thereof, due to weather or other travel advisories.
- Employees’ Request for Time Off: Employers would not be required to provide call-in pay when they cancel a shift in response to an employee’s request for time off.
- Emergencies and Acts of God: Call-in pay for a cancelled shift would not have to be paid when an employer cannot operate due to an act of God or other cause not within the employer’s control, including, but not limited to, a declared state of emergency.
What Should Employers Do Now?
New York employers should monitor the status of the proposed regulations and review their on-call and scheduling practices to determine how they might be affected by them, as well as start to plan now for how to comply so that they are ready to do so when they are adopted. Employers who need more guidance should consult with their employment and labor counsel. Interested employers can also still submit comments to the DOL about the proposed regulations by email to email@example.com.