California’s labor laws are among the most protective of employees in the United States, and reporting time pay in California is no exception.
These laws require employers to provide partial compensation when employees report for a scheduled shift but work fewer hours than expected — or none at all.
The reasoning behind reporting time laws is twofold:
- They ensure workers are fairly compensated for their time;
- They encourage employers to maintain reliable schedules for non-exempt employees.
For legal practitioners, understanding these rules is critical. Whether you’re advising a business client or creating your firm’s own employment policies, understanding reporting time pay laws will help avoid disgruntled employees and wage/hour penalties.
This guide unpacks the essentials of reporting time pay in California, highlights common workplace scenarios, and provides a sample reporting time pay policy to help your firm comply with the law.
What is reporting time pay?
Reporting time pay is a requirement under California’s wage and hour regulations, specifically outlined in Industrial Welfare Commission Wage Order 1-16(5)(A).
The rule ensures that employees who show up for a scheduled shift receive compensation for at least part of their time, even if they are sent home early.
For instance, if an employee is scheduled to work eight hours but is sent home after just two hours due to unforeseen circumstances, the employer must pay for half of the scheduled shift, no less than two hours, and no more than four hours.
The intention behind the law is to protect employees’ time and to provide financial stability when circumstances outside their control impact their income.
When is reporting time pay required?
Employers must provide reporting time pay in specific circumstances, such as:
Lack of work
An employee arrives for a scheduled shift only to find that there’s insufficient work for the day. For example, if a case settles a week before trial, law clerks who were scheduled to assist with trial preparation might be sent home early on the day of the settlement.
Schedule changes
If an employer accidentally over-schedules staff and later adjusts the schedule, reporting time pay applies to those sent home early.
In a law firm, for example, this might happen when multiple data entry clerks are scheduled to work on transferring paper files into the cloud, only to find that the firm hired an outside consultant to do the work.
Common questions about reporting time pay
Because reporting time pay laws can be complex, they often raise questions among employers and employees alike. Here are some of the most common:
Are part-time employees eligible for reporting time pay?
Yes, reporting time pay applies to both full-time and part-time employees. The key requirement is that the employee is non-exempt under California labor law.
Do remote workers qualify for reporting time pay if asked not to log in at the last minute?
In many circumstances, yes. In the case of Ward v. Tilly’s, Inc., the California Court of Appeal explained why this is so:
If an employer directs employees to present themselves for work by physically appearing at the workplace at the shift’s start, then the reporting time requirement is triggered by the employee’s appearance at the jobsite. But if the employer directs employees to present themselves for work by logging on to a computer remotely, or by appearing at a client’s jobsite, or by setting out on a trucking route, then the employee “reports for work” by doing those things. (p. 1185)
Does reporting time pay apply to on-call employees?
Not always. On-call employees are generally entitled to reporting time pay if they are required to remain at or near the workplace while on call. However, if they are free to use their time as they wish and not required to report to work, the law may not apply.
How do canceled shifts factor into reporting time pay?
If an employee is informed of a canceled shift with less than adequate notice and still reports to work, the employer must pay reporting time pay for the time the employee could have reasonably expected to work that day.
How does reporting time pay interact with overtime laws?
California’s overtime laws add another layer of complexity to reporting time pay. Employers must ensure that reporting time pay does not inadvertently cause non-exempt employees to earn overtime for hours not actually worked.
For example, if an employee works six hours in a shift but was scheduled for ten hours, the four hours of reporting time pay do not count toward overtime calculations. As explained by the Department of Industrial Relations (DIR), “Reporting time pay is not compensation for services rendered or labor performed and thus, is not used in determining if overtime is due.”
What if an employee is sent home early for poor performance
It may seem counterintuitive, but if your firm sends a non-exempt employee home early due to poor performance, you may still owe them reporting time pay.
Indeed, according to the DIR, “Performing at a level that the employer feels is unacceptable does not fall within any of the exceptions to the employer’s obligation to pay reporting time pay.”
Exceptions to reporting time pay requirements
While reporting time pay rules aim to protect employees, there are specific exceptions in the Wage Order that delineate when employers are not obligated to provide additional compensation. These include:
Threats to the property
Reporting time pay is not required when there is an existing threat to employees. For example, if a car crash near the firm downed a powerline, thereby rendering the office unsafe, reporting time pay would not apply.
Natural disasters
Likewise, if damage from an earthquake makes it impossible to enter the building, reporting time pay would not kick in. The Wage Orders refer to these instances as “Acts of God,” which would also include things like floods, excessive snowfall, or other natural disasters.
Written agreements or contracts
If an employee agrees in writing to a flexible schedule or on-call arrangement, and the terms align with labor law standards, reporting time pay may not be required.
Employers must document these exceptions carefully to avoid disputes and demonstrate compliance during audits or litigation.
Penalties for non-compliance
Failing to comply with California’s reporting time pay laws can result in significant penalties for employers.
The Division of Labor Standards Enforcement (DLSE) may impose fines, and employees may file lawsuits or join class actions to recover unpaid wages.
Potential consequences include:
- Fines for each violation, which can accumulate quickly if multiple employees are affected.
- Payment of unpaid wages, plus interest and additional penalties.
- Legal fees and costs associated with defending non-compliance claims.
Employers can minimize these risks by maintaining clear payroll records, providing proper training to managers, and conducting periodic reviews of their scheduling practices.
Sample reporting time pay policy for law firms
To ensure compliance and streamline payroll processes, law firms should consider implementing a formal reporting time pay policy.
Below is a sample policy tailored for legal practices:
Sample Reporting Time Pay Policy
[Law Firm Name] is committed to compliance with all California labor laws, including reporting time pay requirements. This policy applies to all non-exempt employees, including but not limited to file clerks, data entry clerks, law clerks, and administrative assistants.
Eligibility: Non-exempt employees who report to work as scheduled and are sent home before completing half of their scheduled shift will receive reporting time pay in accordance with California law.
Compensation: Reporting time pay will be calculated at the employee’s regular hourly rate and will be no less than two hours and no more than four hours.
Exceptions: Reporting time pay does not apply in the following circumstances:
- Operations are disrupted due to power outages, natural disasters, or other emergencies beyond the firm’s control.
- The employee has agreed to an on-call arrangement or flexible schedule in writing.
- The employee voluntarily requests to leave early.
Documentation: Managers are required to document all schedule changes and provide timely updates to affected employees. Employees should report any discrepancies in their pay immediately to [HR Contact/Payroll Department].
Remote Work Considerations: Non-exempt employees scheduled to work remotely will be compensated under the same reporting time pay guidelines if their shifts are shortened or canceled unexpectedly.
Conclusion
California’s reporting time pay laws are designed to protect workers’ time and ensure fairness in the workplace.
For legal practitioners, understanding these laws is essential to advising clients on compliance and mitigating their own risk of wage and hour suits.
Whether it’s drafting clear policies or simply answering employee questions, staying informed about reporting time pay requirements can help California’s law firms (and their clients) steer clear of penalties, avoid litigation, and keep employees happy.
