Hollister Co. is ringing in the new year with a new lawsuit. On January 7, 2016, Hollister was slapped with a class action lawsuit alleging the retailer failed to properly compensate employees for scheduled “on-call” shifts. This litigation links Hollister with an increasing number of employers facing similar lawsuits, including well-known brands such as Forever21, BCBG Max Azria Group, LLC and Williams-Sonoma Inc.
On-call shifts are nothing new for those familiar with the retail and food-service industries. Other industries use on-call scheduling in other scenarios (like the security officer who must remain “on-call” during her break in case of an emergency). But the scheduling practice as applied to the world of retail and food-service, used for years, works like this: on-call shifts are included in an employee’s regular work schedule, and the employee is required to report to, or contact, a supervisor at some predetermined amount of time before being required to report for work. The supervisor then informs the employee whether or not they will be needed that day, and if the employee is not needed, they are sent home. This allows employers flexibility in staffing to reflect actual, real-time needs.
On the other hand, employees argue the scheduling practice makes it impossible to earn a consistent living, or plan for things like child and elder care. In an attempt to legislate through litigation, plaintiffs’ attorneys are challenging the practice, arguing it triggers “reporting pay” obligations under the laws of California and some other states with similar obligations such as New York. The lawsuits claim employers are failing to pay for all time worked, including reporting time, and typically including derivative claims including unlawful business practices, failure to pay minimum wage, and other wage and hour violations.
The surge of complaints alleging wage and hour violations as a result of on-call shifts has garnered significant attention. New York’s attorney general, Eric Schneiderman, opened an inquiry with 13 national retailers about the scheduling practice. Retail giants such as The Gap, Bath & Body Works LLC, Victoria’s Secret, and others have all announced they will be making changes to employee scheduling, or eliminating on-call shifts altogether.
As the trend to reject on-call shifts surges forward, and the flow of claims based on on‑call shifts continues, employers should be proactive in reexamining, and possibly changing their scheduling practices, before they are called in to court themselves.