For decades, California law has required that employees who “report for duty,” but are not actually supplied with at least half of their regular work hours, must be paid a minimum of half their scheduled or usual shift. In that scenario, the requirements specify a minimum of 2 hours and a maximum of 4 hours of “reporting-time” pay. “Reporting-time” pay has long been applied only to situations where the employee actually arrives at work, and is then sent home for lack of work.
To avoid “reporting-time” pay, yet still retain flexibility to adjust to any unexpected increases in customers, many employers have switched to a “call-in” system; restaurants and retail employers in particular have gone this route. Specifically, the employer requires employees to call, text or e-mail into work prior to the start of a tentatively scheduled shift to find out if they actually need to show up. Employees, however, are severely restricted in activities they can plan during their day, because their “call-in” may result in an actual demand to “report for duty.”
The Japanese restaurant chain, Yoshinoya, used such a call-in procedure, relying on the principle that reporting-time pay only applied to situations where the employee physically reported to the worksite before finding out there was no work. In November 2017, a Los Angles trial court ruled that Yoshinoya was wrong.
In Monroy v. Yoshinoya America, the trial court ruled that employees who are required to block off time and call-in the same day for tentative shifts must be paid reporting time pay, even if the employees don’t have to physically show up for the shift. At Yoshinoya, it was standard operating procedure for the employer to require employees to call in two hours before a designated “on-call shift” and if an employee failed to do so he/she would be disciplined. The court recognized that reporting in via phone, text or email, was the modern equivalent of “reporting for duty,” and thus, subject to reporting-time pay. The court stated that workers who call-in need to make the same preparations and incur the same expenses for setting up last-minute contingencies as those who physically report to the worksite without being put to work.
While the Yoshinoya trial-court ruling is not binding on other courts, it does signal a change in how courts view call-in policies. Perhaps sensing a trend, in December 2017, Pier 1 Imports settled a similar case brought in federal court. In that case, employees were required to call-in one-to-two hours before a scheduled shift to ask if they had report to work. Since they had to plan their day around the possibility that they would need to show up for work, they claimed the practice caused the same disruption that the “reporting-time” law was designed to remedy. On the heels of the Yoshinoya case, Pier 1 avoided going to trial by agreeing to settle their case for $3.5 million.
The city of San Francisco “beat everyone to the punch” in 2015 by passing an ordinance known as the “Retail Workers’ Bill of Rights.” Among its many provisions are regulations related to “call-in that does not result in reporting for duty.” Just as San Francisco started the trend of paid sick-leave ordinances that ultimately became a state-wide law, the requirement to provide call-in pay may ultimately spread to affect all California employers. LightGabler will continue to monitor this situation.
In general, California employment laws are intended to ensure that employers do not take advantage of workers. As technology has evolved and employees are available 24 hour a day via their electronic devices, it is likely that the traditional “reporting-time” pay requirement will expand in the future to include situations like the one in the Yoshinoya America case. California employers should minimize “call-in reporting” to the extent possible, and consider other options for ensuring flexibility in staffing, even if last-minute needs are unavoidable. If a mandatory call-in procedure is necessary, employers should get legal advice regarding the attendant pay obligations.