When employees are on call, we pay wages for time spent on a call, plus $100 just for being on call. Is this $100 used when calculating their regular rate?
Yes, when an employer gives employees money for performing a job or duty, that money is a wage and needs to be included in the regular rate calculation.
The Division of Labor Standards Enforcement (DLSE) has issued guidance on this issue in its Enforcement Policies and Interpretations Manual as stated below:
18.104.22.168 What Must Be Included In Calculating Regular Rate.
Any sum paid for hours worked must, of course, be included in the calculation. Also, any payment for performing a duty must be included. For example, an employment contract may provide that employees who are assigned to be available for calls for specific periods will receive a payment of $25 for each 8-hour period during which they are “on call” in addition to pay at their regular (or overtime) rate for hours actually spent in making calls.
If the employees who are thus “on call” are not confined to their homes or to any particular place, but may come and go as they please, provided that they leave word where they may be reached, the hours spent “on call” are not considered as hours worked (See discussion at Section 46.6.3, et seq. of this Manual).
Although the payment received by employees for such “on call” time is, therefore, not allocable to any specific hours of work, it is clearly paid as compensation for performing a duty involved in the employee’s job and, therefore, the payment must be included in the employee’s regular rate in the same manner as any payment for services, such as an attendance bonus, which is not related to any specific hours of work.
For more information about calculating the regular rate, review articles on the California Chamber of Commerce HRCalifornia.com website.
Column based on questions asked by callers on the Labor Law Helpline, a service to California Chamber of Commerce preferred and executive members. For expert explanations of labor laws and Cal/OSHA regulations, not legal counsel for specific situations, call (800) 348-2262 or submit your question at www.hrcalifornia.com.