The decision recognizes that workers have to pay for childcare, elder care, and make other arrangements to go to work, regardless of an employer’s interest in flexible staffing. Planning to report for a shift may mean foregoing the opportunity to attend classes or to schedule a shift at another job. In addition to the real, fixed costs of going to work, there are lost opportunity costs for workers, as well.
In 2012 Skylar Ward worked as a sales clerk at a Tilly’s store in Torrance, CA. Like other Tilly’s employees, she was scheduled for “on call” shifts (also referred to as “call-in” shifts), which had a designated beginning time and quitting time. She was required to contact the store two hours before the start of her on-call shift to determine whether she actually needed to go in. Tilly’s informed its employees to consider an on-call shift a definite thing until they were actually told not to come.
Employees were disciplined if they failed to contact their stores before on-call shifts, if they contacted the store late, or if they refused to work on-call shifts. Discipline included formal written reprimands and, upon three violations, could include termination. However, Tilly’s did not include on-call shifts as part of the employee’s scheduled day’s work when calculating pay unless the employee was required to work the shift, and it did not consider an employee to have reported for work if he or she called the store prior to an on-call shift, but was told he or she was not needed.
The Complaint alleges that Tilly’s failure to properly compensate employees for those shifts resulted in violations of Wage Order 7, Labor Code sections 200–203, 226, and 226.3, and Business and Professions Code section 17200.
What does it mean to “report to work?”
Employers have long recognized the value of a large contingent workforce, which could be called upon when needed, but did not have to be paid when not needed. This, however, is an arrangement that works primarily for the benefit of the employer, not the employee, upon whom it imposes considerable burdens.
The Industrial Welfare Commission (IWC) sought to combat abuses of the “on-call” system as early as 1942 by enacting a reporting time pay requirement. Wage Order 7 and related sections of the Labor Code and Business and Professions Code mandate that non-exempt retail employees be paid “reporting time pay” if either “an employee is required to report for work and does report, but is not put to work or is furnished less than half said employee’s usual or scheduled day’s work” or “an employee is required to report for work a second time in any one workday and is furnished less than two (2) hours of work on the second reporting.”
The question, at least for some of the Appeals Court Justices, was whether “reporting for work” under the Wage Order actually required a worker’s physical presence at the place of employment or whether, in the light of technological developments, “reporting for work” could also occur in other ways – by telephone or computer login, for instance.
Common sense solution
The decision does, at certain points, seem at risk of devolving into a war of dictionaries, but settles finally on a review of the original intent of Wage Order 7. The Court reasons that call-in reporting time pay:
• requires employers to internalize some of the costs of overscheduling, thus encouraging employees to accurately project their labor needs and to schedule accordingly;
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• makes employee income more predictable, by guaranteeing employees a portion of the wages they would earn if they were permitted to work the on-call shifts.
Further, this interpretation of the Wage Order appears to be consistent with the California Supreme Court’s decision in Augustus v. ABM Security Services where the Court focused on an employee’s freedom from employer control to determine whether an employee was “at work.”
Either way, this seems like a solid victory for workers who seek unpaid wages for the value of their time and labor.