Many industries rely on employees to remain accessible outside of standard shifts, and that availability (whether remote or on-site) often comes with a price: on-call pay. While the number of on-call workers may not be high worldwide (in the US approximately 1.7% of workers are classed as on-call compared to between 4-10% in the EU, and potentially as high as 22% of workers being available for on-call work in Australia), rules and complications around on-call pay can have an oversized impact on companies that may need on-call workers.
What Is On-Call Pay?
At its core, on-call pay refers to compensation given to employees who must remain available to work outside their usual shift, typically meaning during evenings, weekends, or holidays. They may not be working every moment they’re on call, but their freedom is limited by the expectation that they can step in at a moment’s notice. As a result, they typically require a higher rate of on-call pay or adaptive shift policies than can complicate payroll significantly.
This article explains what on-call pay is, who qualifies for it, how it’s calculated, and how businesses can create fair, compliant policies that meet both legal standards and employee expectations, using the US as an example for the variety of state and federal laws that can exist around the world in relation to on-call pay. Whether you’re an employer structuring a workforce policy or a worker curious about your rights, understanding this concept is essential.
Definition and Common Use Cases
On-call pay isn’t a bonus per se, but a response to restricted time, as employees on call are expected to be ready to perform job duties, sometimes with little to no notice. However, compensation varies widely depending on the industry, employee classification, and local laws.
Common examples of roles requiring on-call workers include healthcare professionals waiting to be called into surgery, IT staff managing system outages, or maintenance workers prepared to address facility emergencies overnight. This variety of skill levels and industries mean on-call pay policies can potentially impact any number of sectors and companies.
In all these scenarios, employees are much less often “off the clock” in the traditional sense, instead, their time is partially or fully restricted, and that often qualifies as compensable.
Industries Where On-Call Work Is Common
Not all jobs require on-call availability, but in some sectors, it’s the norm. Healthcare, emergency services, information technology, utilities, and facilities maintenance are just a few of the industries where employees are routinely scheduled for on-call shifts.
In global organizations, especially those operating across time zones, on-call work is often built into the staffing model.
Why On-Call Pay Matters for Employers and Employees
On-call pay isn’t just a matter of compliance but a cornerstone of trust and motivation for some of the hardest-working employees in key sectors. From the employee’s perspective, being on call cuts into personal time, and fair compensation acknowledges that sacrifice. For employers, offering clear and competitive on-call pay helps retain top talent, especially in high-pressure roles.
In today’s world of hybrid and remote work, employees may be reachable at all hours, but that doesn’t mean they should be unpaid, so, having a documented, consistent approach to on-call pay vs regular pay builds credibility and reduces friction between teams and HR.
Who Qualifies for On-Call Pay?
Hourly Workers vs. Salaried Employees
Not all employees are entitled to on-call pay in the same way. As an example, in the US the biggest distinction is between non-exempt (hourly) and exempt (salaried) workers under the Fair Labor Standards Act (FLSA). In this case, non-exempt workers must be paid for all compensable hours, including certain types of on-call time.
Salaried employees, especially those in executive or administrative roles, are often not entitled to additional pay for on-call availability, unless company policy states otherwise. However, ambiguity around job classifications can lead to compliance issues, particularly in gray areas like IT support or technical project management roles.
Full-Time vs. Part-Time Eligibility
Full-time workers are more likely to be scheduled for formal on-call shifts, but part-time staff may also qualify, especially if the expectations around availability are clearly defined and restrictive. In this way, it’s not the number of hours worked per week that determines on-call pay eligibility, but rather the level of control the employer has over the employee’s time.
Employers must consider how restrictions on movement, response expectations, and required availability affect both full-time and part-time team members. Compensation policies should reflect this, ideally written into contracts or employee handbooks to prevent disputes.
Unionized Workforces and Contracts
Union contracts frequently address on-call pay in detail, and Collective Bargaining Agreements (CBAs) around the world often include language around minimum compensation, on-call hour limits, and premiums for nights, weekends, or holidays.
In unionized environments, failing to honor agreed-upon on-call compensation policies can lead to grievances or legal action, so it’s essential for HR departments to align internal policies with negotiated terms.
How Does On-Call Pay Work?
Different Types of On-Call Scenarios
The nature of the role and how restricted an employee’s time is outside of standard working hours plays a huge role in determining when and how on-call time is compensated.
Remote On-Call (Phone or Email Availability)
In many cases, employees can remain at home during on-call hours, expected only to respond to messages or calls as needed. If the employee can use this time freely and only respond occasionally, it may not be considered work time.
However, if the employer imposes strict response times or frequent check-ins, or if the interruptions are frequent enough to limit personal freedom, this time may become compensable.
As more companies adopt remote work models, having a clear on-call policy for phone or email availability is critical. Unfortunately, this kind of blending of working and non-working hours is increasingly leading to confusion around the need for on-call pay. This is especially true when managing global teams.
On-Site On-Call (Hospital, IT, Emergency Services)
In certain roles, employees must remain on-site, ready to work immediately if needed. This is common in hospitals, server centers, fire departments, and similar environments. In nearly all cases, on-site on-call hours count as compensable work time.
Employers must ensure these hours are tracked properly and that employees are paid according to the rate agreed upon, either flat fee, hourly rate, or with overtime if thresholds are crossed.
Rotating On-Call Schedules
To prevent burnout and keep workloads manageable, many companies adopt rotating on-call schedules. One week, a specific employee handles all on-call responsibilities and the next week, another takes over.
This method spreads the burden and can improve fairness, but it requires transparent communication and more complex scheduling tools. Employers must define expectations clearly and ensure coverage at all times while adapting pay structures continuously.
When Does On-Call Time Count as Work Time?
Factors That Determine Compensability
The biggest question employers and employees face is: when does on-call time count as paid work time? The answer lies in the level of restriction imposed on the employee’s personal time. Typically, if an employee’s freedom is significantly limited during on-call hours, those hours may be compensable.
Courts and regulators often consider a few key factors:
- Frequency of calls or interruptions
- Location requirements (must stay at home, on-site, or within a certain radius)
- Response expectations (how fast must the employee react?)
- Ability to use time freely for personal activities
Thus, if employees can’t engage in normal life like running errands, attending events, or even relaxing, the time is usually considered work time.
Freedom vs. Restriction of Movement
If a worker is free to go about their personal life during on-call hours, and interruptions are rare, the time may not need to be paid. However, if they’re required to stay within a tight geographic range or stay glued to a phone, the restriction of movement could trigger compensability. This means that companies have to carefully choose which hours will be treated as on-call and establish correct working procedures for those hours.
Essentially, it’s not about whether the employee could work, but whether they can reasonably enjoy their time. For instance, a tech support employee who must respond within five minutes and can’t leave home is likely entitled to on-call pay, even if they’re not actively troubleshooting.
Response Time Requirements
The shorter the response window, the more likely the time is legally considered work. A one-hour response time allows for some freedom, but a five-minute requirement is essentially a tethered work shift. Employers must set expectations carefully and understand how their response protocols impact compensability.
Establishing on-call policies early on helps international employers balance flexibility and compliance. By analyzing regional labor rules and advising on response policies, local labor experts can help companies design on-call programs that reduce risk and increase employee satisfaction.
Pay Rates for On-Call Hours
Flat Rate, Hourly Rate, or Overtime
There are several models for compensating on-call time:
- Flat rate – A single fixed amount for the entire on-call shift, whether the employee is called in or not.
- Hourly rate – Employees are paid a reduced or full hourly wage for each on-call hour.
- Overtime – If the combination of regular and on-call hours exceeds 40 in a week, overtime pay may apply.
Which model an employer chooses depends on industry norms, legal requirements, and internal policy, among other requirements, according to the specifics of the situation. What matters most is clarity and consistency, as ambiguous pay structures are more likely to lead to disputes and compliance risk.
Minimum On-Call Compensation by Law
While some legal jurisdictions provide basic legal guidance on paying on-call employees, some systems go further, matching the high level of importance placed on on-call workers with strict legal compliance measures.
For example, California’s wage orders require full compensation even for scheduled on-call shifts where the employee isn’t called in. Other jurisdictions require “reporting pay,” meaning employees must be compensated for being available, even if they’re never activated, though this pay may be lower than that of employees who get called in.
Weekend or Holiday On-Call Premiums
To attract staff to cover high-demand times, many employers offer on-call premiums for weekends, nights, or holidays. While these higher payments aren’t always required under labor law requirements (outside of typical premiums for weekends or night shifts), they can feature as competitive incentives when outlined in company policy or union agreements.
Offering higher rates during inconvenient hours helps improve morale and participation in the on-call program, so it’s a small investment that pays off in better coverage and reduced burnout.
A Specific Example of Legal Guidelines for On-Call Pay
On-Call Pay Under the Fair Labor Standards Act (FLSA) for US Employees
The FLSA doesn’t mandate on-call pay by default according to an employee’s role, but it does establish rules for when on-call time is considered compensable. According to the U.S. Department of Labor:
“An employee who is required to remain on call on the employer’s premises or so close thereto that they cannot use the time effectively for their own purposes is working while ‘on call’.”
Effectively, if a US employee’s freedom is restricted, the time must be paid. Conversely, employees who are free to use their time and only need to check in occasionally may not be entitled to pay unless they’re actually working.
When Employers Must Compensate (According to US Labor Law)
Employers must compensate:
- On-call hours when employees are required to stay on-site
- Time when personal movement is heavily restricted
- Periods when response time requirements limit personal freedom
- Actual work done during on-call hours (e.g., answering a service call at 2 a.m.)
FLSA violations can lead to back pay claims, penalties, and reputational harm. Employers must tread carefully, especially when managing hourly workers. This is where INS Global offers critical support by keeping companies compliant across complex, multi-jurisdictional labor frameworks.
Common Compliance Mistakes to Avoid
Even well-meaning employers make costly mistakes, and issues around on-call pay can be particularly difficult to avoid with a well-designed and compliance-assured payroll processing system. Common pitfalls can include:
- Assuming salaried status exempts employees from all compensation
- Failing to track actual hours worked during on-call periods
- Not accounting for response-time restrictions
- Ignoring state-level on-call laws
- Treating global employees under a one-size-fits-all policy
The best way to avoid these errors is with a detailed, legally vetted on-call compensation policy, ideally reviewed by experts familiar with both local and international labor laws, like the specialists at INS Global.
US State-Specific On-Call Pay Laws
Examples from California, New York, Texas, and More
While the FLSA offers a baseline, states like California, New York, and others impose stricter rules for on-call work. In California, for instance, Wage Order 7 requires certain employers to compensate employees who are scheduled to report but aren’t called in.
In New York, labor regulations favor service workers and may require additional pay when availability limits personal freedom, even if no work is performed. Meanwhile, Texas follows federal guidelines, but employers still must document expectations clearly to avoid liability.
Companies operating in multiple states must be particularly careful to navigate these variations with care. State-specific HR policies, or those developed with insight from experts, are therefore essential for multi-state or cross-border compliance assurance.
Union Contracts and Company Policies
Negotiated On-Call Terms in Labor Agreements
It’s important to remember that, in addition to national or local laws, in unionized workplaces or in countries with strong protections for workers’ organizations, collective bargaining agreements (CBAs) can govern everything from wage rates to work hours, including on-call expectations. These agreements may require:
- Minimum on-call pay
- Premiums for after-hours work
- Rest periods between shifts
- Limits on on-call frequency
Failing to honor these agreements can result in grievances, arbitration, or even strikes, so HR leaders must remember to coordinate closely with legal teams and ensure on-call schedules are aligned with negotiated rights.
Internal Policies That Go Beyond Legal Minimums
Even in non-union environments, smart employers might choose to go above legal minimums. Offering higher-than-expected on-call compensation like this can demonstrate respect, reduce turnover, and boost job satisfaction. However, as in any other situation, it is essential to clearly express company policies concerning on-call pay in easily accessible employee materials.
A well-documented on-call pay policy should address:
- Eligibility
- Pay structure (flat, hourly, overtime)
- Expectations during on-call hours
- Response time requirements
- Procedures for logging time
When structured thoughtfully, these policies can enhance your employer brand and strengthen team commitment.
On-Call Pay Examples by Industry
Healthcare and Hospitals
Hospitals rely heavily on on-call staffing models, and traditionally, surgeons, anesthesiologists, and critical care nurses often rotate on-call shifts to ensure emergency coverage.
Because of the critical nature of their skills and experience, as well as the urgency of medical situations, these employees may be required to remain within a short distance from the facility and respond within minutes.
In unionized hospitals, on-call pay rates and premiums are frequently negotiated, with specific rates for night or weekend coverage, but the high stakes in healthcare mean policies must be clear, consistent, and fair.
IT and Tech Support
IT departments commonly use rotating on-call schedules to handle system outages or cybersecurity threats that can threaten operational capacity. These roles often require remote availability, further complicating matters, with employees being expected to monitor alerts and respond to incidents during off-hours.
Although employees may be at home during these shifts, frequent interruptions and strict response times can convert otherwise unpaid hours into compensable work, meaning companies must assess the intensity of each potential on-call period to determine fair pay. As tech companies expand globally, INS Global ensures international labor compliance for distributed IT support teams.
Emergency Services (Police, Firefighters, Utilities)
Public safety and utility services operate 24/7, with on-call traditionally shifts baked into the scheduling framework.
Because of the life-and-death nature of the work, most on-call hours in these fields are compensable at higher-than-normal rates, with added premiums for nights, holidays, or hazardous conditions.
Maintenance and Facilities Management
Commercial buildings, schools, and manufacturing plants may require on-call maintenance staff to handle power failures, plumbing issues, or safety alarms in the event of out-of-hours issues. These roles typically follow rotating schedules, with pay determined by response urgency and location restrictions.
Customer Service and Call Centers
While less commonly considered as on-call, customer-facing industries may rely on availability, even outside traditional business hours. In special cases, some call center agents and service operatives may remain available outside of their shifts during nights or weekends, especially when supporting global clients in differing time zones.
If an employee is required to monitor a support line, stay logged into a system, or respond to a ticket within minutes, that time could easily fall under compensable work hours.
How to Set Up an On-Call Pay Policy: Steps for Employers
- Define On-Call Responsibilities Clearly – Start by defining what “on-call” means within your organization and the roles your employees fulfill. Is it availability from home, presence on-site, or a rotating shift system? By outlining the expectations clearly, such as when employees are expected to respond, what counts as a “call,” and how quickly they must act, your organization can prevent misunderstandings and give employees a solid foundation to operate from.
- Set Pay Rates and Communication Protocols – Decide how you’ll compensate employees for their availability and their active time. Will you use a flat rate? An hourly rate? Will premiums apply for nights or holidays? Detail how pay is calculated and how employees should track and report their time. Also, outline how communication will occur during on-call shifts.
- Comply with Labor Laws and Document Everything – Use relevant local laws as your baseline, then adjust your policy to account for state-specific or international laws. Document your policy in your employee handbook or contract agreements, and have it reviewed by legal or HR professionals. Global companies most often struggle to align these policies across countries, so make sure you are bringing in advisors with expertise in each relevant jurisdiction.
Tips for Managing On-Call Teams
Use Scheduling Tools and Alerts
Use digital scheduling tools to build fair, transparent on-call rosters. Systems like Slack, PagerDuty, or internal platforms can send automatic alerts and reminders, making transitions smoother and quicker.
For global teams, use scheduling software that can account for time zone differences and labor restrictions, especially as more countries impose a “right to disconnect” for employees not on call. Here, INS Global can help companies integrate tech solutions into comprehensive HR systems that simplify international team coordination.
Offer Incentives or Perks
On-call work can be stressful, so offering appropriate non-monetary incentives like flexible time off, wellness stipends, or extra vacation days can increase participation and reduce burnout. Recognizing on-call reliability in performance reviews or employee recognition programs also helps boost morale.
Additional gestures to help recognize important efforts can be low-cost ways to show employees their availability is valued and that the organization supports their well-being.
Rotate Shifts to Prevent Burnout
Never assign the same employees to on-call duty week after week, but instead use a fair rotation to ensure coverage while giving everyone time to recharge. This kind of rotating on-call responsibilities builds team resilience and prevents overdependence or burnout for any one person.
Know the Rules. Own the Policy. Empower the Team.
Creating a compliant, effective on-call compensation policy doesn’t have to be complicated. But it does require thoughtfulness, consistency, and legal awareness. Whether you’re compensating healthcare workers on standby, tech teams monitoring systems overnight, or remote employees available after-hours, clear policies build trust and protect your business.
Employees deserve to know their rights. Employers need to stay compliant. The key is building a system that works for both, and that’s where INS Global can help.
As a global leader in PEO and EOR solutions, with services available across 160+ countries worldwide, INS Global supports businesses of every size with payroll, HR, compliance, workforce management, and more. Whether you’re designing an on-call policy and payroll system in California, Berlin, or Singapore, INS Global provides the expertise and infrastructure you need to stay ahead of complex labor regulations.
Ready to build a smarter, globally compliant on-call pay policy? Connect with INS Global today and let us help you support your team, whenever and wherever they’re needed.
FAQs About On-Call Pay
Do I Get Paid If I’m On-Call But Not Called In?
It depends. If your freedom of movement or activity is limited, the time may be compensable, even if you’re never called in. If you’re free to go about your day and only respond when needed, that time may not be paid (or paid full-time rates) unless actual work is performed. Each case depends on restrictions and response expectations.
Is On-Call Time Considered Overtime?
Yes, if on-call hours push an employee’s total time worked over the accepted number of standard work hours per week, then overtime rules typically apply, depending on local labor laws.
Can Employers Require Me to Be On-Call Without Pay?
Employers can require on-call availability, but they must pay for it if the time is legally considered work. If the restrictions on your time are significant enough to limit your freedom, the law typically requires compensation.
What’s the Difference Between On-Call and Standby Time?
While often used interchangeably, standby time typically implies more immediate readiness, often requiring employees to stay in uniform, on-site, or within close range. On-call time may involve fewer restrictions, depending on the policy.
How Can I Track My On-Call Hours Accurately?
Use digital time-tracking tools, scheduling apps, or manual logs to record when your on-call shift begins and ends, as well as any time spent actively working. Transparency and documentation protect both employees and employers.
What About When There Are Differences Between Federal and State Laws or Legal Differences Across Borders?
Often, when federal and state labor laws differ, employers should assume that the law that offers more protection to the employee prevails. While this often means that businesses must adjust their on-call practices in states with stronger worker protections, it is a policy that offers the best protection for both employer and employee in the case of a dispute.
Trying to apply a uniform national policy without understanding these differences is a common and expensive mistake.
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