New York Proposes Regulations on Employee On-Call and Call-In Pay

December 18, 2017Alerts Labor & Employment Alert

The New York State Department of Labor published proposed regulations to the Miscellaneous Industries and Occupations Wage Order in the New York State Register addressing so-called “just in time,” “call-in” or “on-call” scheduling demands facing employees. The proposed regulations, published on November 22, are subject to a 45-day comment period.

According to Governor Andrew M. Cuomo and the NYSDOL, employers sometimes schedule or cancel a worker’s shift a few hours before the shift begins, or just after it starts, which “often leave[s] workers scrambling to find child care and forces them to miss appointments, classes or important family commitments.” The proposed regulations aim to create fairness for employee pay and flexibility for employers scheduling unpredicted shifts by modifying only the Minimum Wage Order for Miscellaneous Industries and Occupations (the “Miscellaneous Wage Order”) for non-exempt employees at for-profit and certain nonprofit institutions. The proposed regulations would not affect businesses subject to the Wage Orders for the hospitality industry, building services industry or agricultural industry.

Call-In Pay Under Current New York Law

Under the current Miscellaneous Wage Order (Sections 142-2.3 and 142-3.3), non-exempt employees who report to work are entitled to call-in pay that is the lesser of either four (4) hours of pay or the hours of pay in the employee’s regularly scheduled shift at the state minimum wage rate. In a December 2009 opinion letter, the NYSDOL interpreted this provision to only require call-in pay for non-exempt employees if their wages for the workweek are less than the minimum and overtime rate for all hours worked plus any call-in pay owed. This means that under the current regulations, employers can “offset” amounts paid to an employee above the state minimum wage and overtime rates during the workweek against any call-in pay otherwise due to the employee. 

The current Miscellaneous Wage Order contains no additional payment obligations if employers schedule or cancel an employee’s shift(s) before the employee reports for work.

Call-In Pay Under the Proposed NYSDOL Regulations

The proposed regulations would revise the Miscellaneous Wage Order’s call-in pay requirement to create the following circumstances where non-exempt employees will be eligible to receive call-in pay:

  • Reporting to work – an employee who reports for work on any shift shall be paid for at least four (4) hours of call-in pay.
  • Unscheduled shift – an employee who reports to work for any hours that have not been scheduled at least 14 days in advance of the shift shall be paid an additional two (2) hours of call-in pay.
  • Cancelled shift – an employee whose shift is cancelled within 72 hours of the shift’s beginning shall be paid for at least (4) hours of call-in pay.
  • On-call – an employee who is required to be available to report to work for any shift shall be paid for at least four (4) hours of call-in pay.
  • Call for schedule – an employee who is required to be in contact with the employer within 72 hours of the shift’s beginning to confirm whether to report to work shall be paid for at least four (4) hours of call-in pay.

Calculation of Call-In Pay

Under the proposed regulations, call-in pay for actual hours worked (i.e. when an employee reports to work for a scheduled or unscheduled shift) shall be calculated at the employee’s regular or overtime rate of pay, whichever is applicable, less any allowances (i.e. credits) permitted by law. However, call-in pay for hours not actually worked (i.e. when an employee’s shift is cancelled or the employee is on-call or must call in for his/her schedule) shall be calculated at the basic minimum wage (based on the employer’s geographic area and size). Call-in pay for hours not actually worked will not count as payments for time worked or work performed and, therefore, need not be included in the regular rate of pay for purposes of calculating overtime.

The proposed regulations also include a provision eliminating the offset amount that is currently permitted for pay exceeding the minimum wage, and also prohibiting any offset to pay from the required use of leave time.

In certain situations, the four (4) hours of call-in pay normally owed to an employee for reporting to work or for a cancelled shift may be reduced to the lesser number of hours that the employee normally works for the regular shift, as long as the employee’s total hours worked—or scheduled to work—for that shift do not change from week-to-week.

Applicability of Call-In Pay Requirements Under the Proposed Regulations

The proposed regulations also contains four exceptions to the call-in pay requirements:

  • The call-in pay requirements do not apply to employees who are covered by a valid collective bargaining agreement that expressly provides for call-in pay.
  • Call-in pay is not required where an employee’s weekly wages exceed 40 times the applicable minimum wage rate, unless that employee reports to work on an unscheduled basis.
    • For example, in 2018, the minimum wage for a large employer in New York City is $13.00 per hour. An employee earning more than $520 per week would be excluded from the call-in pay requirements, except for the requirement that the employee be paid four (4) hours of call-in pay for actually reporting to work.
  • The additional two (2) hours of call-in pay required for an unscheduled shift that has not been scheduled at least 14 days in advance is not required for new employees during the first two weeks of employment or for any regularly scheduled employee who volunteers to cover (i) a new and additional shift during the first two weeks that the shift is worked, or (ii) a shift that has been scheduled at least 14 days in advance to be worked by another employee.
    • A “regularly scheduled employee” is an employee who is scheduled at least 14 days in advance for shifts consistent with a written good faith estimate of hours provided by the employer at the time of hiring, which may be amended at the employee’s request.
    • “Volunteers to cover” means acceptance of any shift-coverage request from another regularly scheduled employee or of an open request from the employer that is extended to all eligible employees.
  • Call-in pay for a cancelled shift (i.e. a shift that is cancelled within 72 hours of the scheduled start of such shift) is not required in the following situations:
    • When an employer cancels a shift due to the employee’s request for time off;
    • When operations at the workplace cannot begin or continue due to an act of God or other reasons outside of the employer’s control, including, but not limited to, a state of emergency declared by federal, state or local government. If operations can begin or continue but staffing needs are reduced due to an act of God or other cause not within the employer’s control, the 72-hour period shall be reduced to 24-hours for regularly scheduled employees.

The NYSDOL insists these proposed regulations help protect minimum wage employees from unpredictable work schedule practices. For employers, the regulations offer flexibility with scheduling new shifts without a premium during the first two weeks of a worker’s employment, permit worker shift swaps and substitutions without penalty and allow for weather-related cancellations without penalty at long as 24-hours’ notice is given. As long as employers are diligent in giving employees advance notice of any schedule changes, they can avoid the call-in pay requirements imposed by the regulations.

The proposed regulations are now subject to a 45-day comment period. If employers would like to submit a comment, they may do so by submitting any such comments to [email protected].

Employers should anticipate that the proposed regulations will be finalized without any substantial changes and plan accordingly. All managers responsible for scheduling should become familiar with the regulations’ requirements and exceptions, and employers should re-examine their scheduling practices. Employers should inform employees that scheduling changes will likely be made at least 14 days in advance in order to comply with the new regulations.

For more information about this Alert, please contact Glenn S. Grindlinger at 212.878.2305 or [email protected], Matthew C. Berger at 646.601.7658 or mberger[email protected] or any other member of Fox Rothschild New York Labor & Employment Department.

This publication is intended for general information purposes only. It does not constitute legal advice. The reader should consult with knowledgeable legal counsel to determine how applicable laws apply to specific facts and situations. This publication is based on the most current information at the time it was written. Since it is possible that the laws or other circumstances may have changed since publication, please call us to discuss any action you may be considering as a result of reading this publication.