California law requires employers to compensate exempt employees for time spent on-call if those restrictions are so onerous that they prevent the employee from effectively using their time for personal pursuits. This differs from federal law, which generally permits employers to avoid paying exempt employees for on-call time if they are able to engage in personal activities. A key consideration is whether the limitations placed on the employee are predominantly for the employer’s benefit. For example, an employee required to remain within a small geographic area and respond to calls within a short timeframe may be entitled to compensation, even if they are not actively working during that time.
Providing adequate compensation for on-call time is vital for maintaining employee morale and ensuring legal compliance. Failure to properly compensate employees for significant on-call restrictions can result in costly legal actions, including back pay, penalties, and interest. California’s stricter interpretation of on-call pay reflects a broader trend towards protecting employee rights and ensuring fair compensation for all hours worked, or effectively worked, due to employer restrictions. Understanding and adhering to these regulations is crucial for any business employing exempt workers in California.