Navigating On-Call Pay: Essential Information for Employers

Your business needs clear policies on employee rights during on-call employment. These procedures should identify the eligible roles, on-call restrictions and compensation details, job requirements, schedule changes, and requests for time off.

It also needs to consider how much workers’ personal activities are restricted. The more restrictive the policy, the more likely you need to pay for on-call time.

Identifying Essential Functions

Ensuring smooth operations relies on pinpointing essential functions, those crucial tasks that keep the wheels turning even during unexpected hiccups. What about those who keep those essential functions humming when they’re “off the clock”?

Exploring how on-call pay works is vital to understanding how we compensate the silent guardians of critical services. But how does on-call pay work exactly? Each job should be assessed independently to determine the most essential duties that would cause harm if not performed.

For example, a library clerk may be required to open and close the office space, but this is not considered an essential function of the position. Clearly defining on-call responsibilities can help employers avoid legal issues and ensure employees are fairly compensated for their time.

When creating an on-call schedule, it’s essential to be clear and concise about what is required of employees — including the amount of time spent on-call, where they must remain within a limited geographic area, and how to contact them.

For example, a call center position requires employees to be available for calls and issues that require immediate response, such as responding to computer network outages or assisting drivers with roadside problems and accidents.

Similarly, some IT professionals and field technicians are expected to be on-call for urgent requests from clients or customers, including setting up appointments or troubleshooting problems.

Employers should carefully assess whether a given task is essential to the job and consider the nature of the work operation and the experience of individuals who have held the position.

While a job description can provide evidence of an essential function, it’s also crucial to consult with individuals who have worked in the role or interview applicants to get pragmatic insight into the actual tasks that are most critical.

Establishing On-Call Requirements

Once you know what type of work your on-call employees will need to do, it’s time to establish the rules that govern their responsibilities. This will likely include on-call pay or compensation and specific guidelines for responding to calls or issues during their on-call shift.

The first thing to consider is whether or not your on-call employees need to remain at or near the workplace. If they are restricted in their movements and cannot engage in personal activities, this may mean that they need to be paid for on-call hours.

For example, let’s say your on-call employee spends four hours on a call and receives one issue that requires them to stop what they are doing and resolve the problem. In this scenario, the issue only took 30 minutes, so you would only need to pay them for the thirty minutes of on-call time they worked on an incident.

Another model involves paying an employee based on how many incidents or issues they resolve during their on-call shift. This can be an excellent way to ensure that on-call employees are well-rested.

Still, it also requires accuracy, as the number of issues resolved will affect an employee’s payout. Generally, this method is better used for small or mid-sized companies with limited resources where incidents are rarely experienced.

Paying for On-Call Time

In some cases, employees required to be on call must be compensated for their time. This depends on several factors, including where an employee is located (i.e., on the work premises or within a certain radius) and how restrictive their employer’s rules are.

For example, if an employer prohibits alcohol consumption or other activities that could interfere with their ability to respond quickly to calls on the weekend, it would be more likely that the employee needs to be paid for their on-call hours.

Federal laws regarding minimum wage, overtime pay, and recordkeeping standards vary from state to state. Consulting a labor law attorney is essential to understanding the specific regulations that apply to your company’s situation.

A company’s policy and employment contracts might influence who qualifies for on-call pay. In general, however, employees restricted to remaining on or near the company’s workplace are considered to be working while on-call and must, therefore, be remunerated accordingly.

Restricted on-call status usually requires employees to not use their on-call time for personal activities, meaning they must be available and ready to respond immediately to any call.

Managing On-Call Employees

You may run into extra stress on your team if you still need a considered and formalized on-call compensation plan. Employees may feel resentful and need clarification about how their time is being spent, leading to burnout and lower retention.

One way to help manage the complexities of on-call work is by using a software solution with built-in communication tools.

Group messaging apps, chat apps, and even group calls are all great options to keep everyone updated on issues and to provide a central point for on-call employees to reach out to the rest of your team for help.

It’s also essential to ensure your on-call scheduling doesn’t present wage and hour challenges for your team members. For example, does your on-call policy restrict employees from engaging in personal activities when on-call?

If so, this is generally considered hours worked; you must pay for on-call time. Other factors to consider include the frequency of calls, how much of an employee’s time is spent working on incidents after business hours, and if you want to add any additional compensation incentives, such as a bonus for completing complex or high-impact issues.

With a well-considered and formalized on-call compensation model, you can help your team stay productive while still providing the quality customer service your customers expect.

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