KBS Reference Desk: On Call Employees Over Holidays

We are getting out for the holidays this week, but are requiring our Director of Maintenance, who is a non-exempt employee, to remain "on call" in case of a facilities emergency (e.g., frozen/burst pipes, break in, etc.) The employee may spend his time freely during the break; however, he must be available to go to the District (if needed) within three (3) hours. Do we have to pay him for his time spent "on call?" 

A:        No. You are not required to pay the employee for his time "on call" since he will be substantially unrestricted in his activities, and therefore only "waiting to be engaged." 

The Fair Labor Standards Act (“FLSA”) governs payments to non-exempt employees while the employee is considered to be “on call.” The key distinction, by FLSA standards, is whether the employee is “waiting to be engaged” or “engaged to wait.” When an employee is “waiting to be engaged,” he is free to go about his own personal activities, so long as those activities do not take him outside of the geographic region. In contrast, employees who are “engaged to wait” are typically required to stay on the employer’s premises, or so close to the premises that the employee “cannot use the time effectively for his own purposes while working on call.” In the scenario above, because the Director of Maintenance was given a three hour window in which to respond to an emergency call, he can travel regionally and otherwise go about personal activities. He is, therefore, “waiting to be engaged” and ineligible for compensation for any time spent “on call.” The employers’ obligation to compensate the maintenance director exists only for the time he is actually called into work, and at the Director’s regular rate of pay. That is, the FLSA does not require a higher rate of pay for employees who work during holiday breaks simply because the employer’s business is not in operation. Rather, the FLSA only requires a higher rate of pay (time and one-half) when the employee’s time worked in a week-long period exceeds 40 hours. Therefore, in this case, since the Director of Maintenance will not be working at all during the holiday unless called in on an emergency, he will receive his regular rate of pay for any work performed. Should the Director’s time spent addressing that emergency exceed 40 hours in a week-long period over the break, he would be eligible for overtime pay, as usual.