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Ruling on Payment for On-Call Time for Nurses


By: 
Date: October 15 2001

A hospital did not violate the Fair Labor Standards Act (FLSA) by not paying its employees the federal minimum wage for their on-call time because the workers were not "working" while they were on call, the 8th U.S. Circuit Court of Appeals recently found.

According to the court´s opinion in Reimer v. Champion Healthcare Corp., the employees, mostly nurses, claimed they were paid below the minimum wage for their on-call hours. However, the employer claimed that the employees were not working while they were on call, so it did not have to pay the workers the federal minimum wage.

Under the FLSA, employers typically must pay their employees a minimum wage for each hour worked (29 U.S.C. §206). To determine whether the employees in Reimer were entitled to the minimum wage for their on-call time, the court needed to decide whether the employees were "working" while they were on call.

Because the FLSA does not define when an employee is "working" for an employer, courts traditionally have considered the following factors when determining whether on-call time is compensable:

  • the terms of the employment agreement, if any;
  • physical restrictions placed on an employee while on call;
  • how quickly on-call employees are expected to respond to calls to work;
  • the percentage of calls expected to be returned by the on-call employee;
  • the frequency of calls during on-call periods;
  • the actual uses of the on-call time by the employee; and
  • any disciplinary action taken by the employer against employees who fail to answer calls.
The Nurses´ On-Call Time

In making its decision, the court first considered the nurses´ responsibilities while they were on-call. According to the court, the nurses had "a great deal of flexibility in their activities." The hospital required that the nurses be reachable by cellular phone or beeper, and if the hospital called them, they had to report to work within 20 minutes. Additionally, the nurses had to refrain from drinking alcohol or using mind-altering drugs or medications while on call.

The hospital did not require that the nurses remain at work or at home while they were on call, the court said. Instead, the nurses could participate in sporting activities, work at home, shop or visit others. The hospital rarely called the employees in to work more than once a shift. During a three-year period, only 36 of the 136 plaintiffs were called in more than once, the court said.

While the nurses were on call, they received an hourly pay rate that was lower than the minimum wage. However, once they were called in, the hospital paid them their regular hourly rate or overtime pay.

The Court´s Decision

After the court addressed the nurses´ on-call time, the appeals court considered other federal court rulings on when on-call time constitutes work. Specifically, the 8th Circuit examined the U.S. Supreme Court´s rulings in Armour & Co. v. Wantock, 323 U.S. 126 (1944), and Skidmore v. Swift & Co., 323 U.S. 134 (1944). In Armour, the High Court held that "an employee´s time is ´work´ for the purposes of the FLSA if it is spent ´predominantly for the benefit of the employer.´" In Skidmore, the Court noted that on-call time is not work when an employee waits to be engaged to work.

After applying the High Court´s findings in both cases to Reimer, the 8th Circuit found that the nurses´ on-call time was not spent "predominantly for the benefit of the employer." According to the 8th Circuit, the employer placed "very few restrictions" on the nurses during their on-call time. "Short of drinking alcohol or taking mind-altering drugs, the appellants could pursue a virtually unlimited range of activities in town or at home," the court said.

The court also found the fact that the nurses were rarely called in more than once a night supported the district court´s conclusion that the on-call time was not work.

Thus, the 8th Circuit found that the nurses were not working when they were on call. Therefore, the appeals court upheld the lower court finding that the nurses were not entitled to the federal minimum wage for each of their on-call hours. (Reimer v. Champion Healthcare Corp., 8th Cir., Nos. 00-2413, 00-2426, July 16, 2001)

From Employer''s Guide to the Fair Labor Standards Act, ©Thompson Publishing Group, Inc.



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