Should Your Business Have an Alternative Work Schedule?

August 27, 2021

With offices returning to in-person work after a year of working remotely, many employees are mourning the loss of the freedom and flexibility provided by work-from-home policies implemented during the COVID-19 pandemic. Many California employers are interested in improving their employees’ job satisfaction, which in turn, can help with talent retention and improve productivity. One option for employers is to implement an alternative work schedule (“AWS”).

What is an Alternative Work Schedule?

An AWS provides a mechanism for employees to work longer hours, but on fewer days, thereby freeing up time for employees to attend to personal business on a weekday and in some cases, better serving the business needs of employers. An AWS, if implemented properly, allows employers to avoid paying overtime wages they would otherwise be required to pay to employees who work more than 8 hours in a single workday. While employers can always provide their employees with more time off, an AWS allows employees flexibility while retaining the 40-hour workweek.

The most common alternative workweek schedules are: (a) four 10-hour days and employees receive an extra day off each week; (b) four 9-hour days and one 8-hour day and employee have an extra day off every other week; and (c) three 12-hour days and one 4-hour day each week and employees receive an extra day and half off each week. However, the availability of these alternative schedules varies depending on the applicable Industrial Welfare Commission (“IWC”) wage order for the employer’s business. Other workhour configurations may be permissible as well.

Pursuant to Labor Code § 511, an AWS can be created for any “readily identifiable work unit,” including “a division, a department, a job classification, a shift, a separate physical location, or a recognized subdivision thereof.” IWC wage order nos. 1-13, 16 and 17, specifically provide for an AWS. However, there are differences within the IWC wage orders both in the type of alternative schedules that may be adopted and in the election procedures that must be followed in order to implement an ASW.  

How does an employer implement an alternative workweek schedule?

Implementing an AWS is very technical, and one misstep can result in huge potential liabilities for employers. It is important that employers carefully review both the applicable IWC wage order for your business and the Labor Code in order to understand the alternative workweek rules applicable to your business. For more information, see the California Division of Labor Standards Enforcement Policies and Interpretations Manual, which explains the wage order provisions for AWS arrangements. 

Labor Code § 511 and most of the IWC wage orders specifically allow the implementation of an alternative work schedule, subject, generally, to the following steps and requirements:

  • The employer must present a written proposal that designates a regularly scheduled alternative workweek. The written proposal must specify the number of regularly recurring workdays and work hours, but need not specify the actual days worked within the AWS.

  • The employer may propose a single work schedule that would become the standard schedule for workers in the work unit, or a list of work schedule options, from which each employee in the unit would be entitled to choose. If an employer adopts a menu of work schedule options, employees may, with employer consent, move from one schedule option to another on a weekly basis.

  • An AWS will only be valid if the proposed AWS is adopted by a secret ballot election by at least a 2/3 vote of the affected employees in the work unit.

  • At least 14 days prior to the secret ballot vote, an employer proposing an AWS must provide a written disclosure at a meeting to the affected employees that describes the effects of the proposed AWS on the employees’ wages, hours, and benefits. Employers are required to mail the written disclosure to employees who do not attend the meeting and must provide copies of the written disclosure to all employees in English as well as any non-English language that is primarily spoken by at least 5% of the affected employees.

  • The secret ballot vote must be held at the affected employees’ work site during regular working hours.

  • The results of the secret ballot vote must be reported to the Department of Labor Standards Enforcement within 30 days of finalizing the results. The report must include the final tally of the vote, the size of the work unit, and the nature of the business of the employer.

  • Employees affected by a change in work hours resulting from the adoption of an ASW may not be required to work those new work hours for at least 30 days after the announcement of the final results of the secret ballot vote.

  • An employer must not reduce an employee’s regular rate of hourly pay as a result of the adoption, repeal, or nullification of an alternative workweek schedule.

Pursuant to Labor Code § 511(d), employers are required to make a reasonable effort to find a work schedule not to exceed eight hours in a workday, in order to accommodate any affected employee who was eligible to vote in an alternative workweek schedule election and who is unable to work the alternative schedule hours established as a result of the election. An employer is also authorized to provide a work schedule not to exceed eight hours in a workday to accommodate any employee who was hired after the date of the election and who is unable to work the alternative schedule established as a result of that election.

What are the effects of implementing an alternative workweek schedule?

If an employer properly implements an ASW, employees may have extra time during the week to attend to their personal business and employers can avoid paying overtime wages they would otherwise be required to pay under Labor Code § 510, which requires that “any work in excess of eight hours in one workday…shall be compensated at the rate of no less than one and one-half times the regular rate of pay for an employee.”

With an AWS, an employer does not have to pay overtime wage for employees for employees working more than 8 hours in a day, but less than 12 hours.  Employer will still have to pay overtime at 1.5 regular rate of pay for work in excess of 40 hours in a week. Employers must also pay double time for work in excess of 12 hours in a day and for any work in excess of 8 hours on days worked beyond the regularly scheduled workdays established by the ASW. Labor Code § 511(b).

An ASW cannot be used to demand more labor from employees for less pay. Instead, an ASW provides employers flexibility to meet unique business demands and provides employees the freedom to spend more consecutive time outside of the workplace, including with their family, friends, and hobbies.

Questions? Contact Freeburg & Granieri, APC Today

If implementing an alternative workweek schedule sounds right for your business, now is the perfect time to contact the attorneys at Freeburg & Granieri, APC. Our attorneys can help you decide the correct type of alternative work schedule for your business and navigate election procedures. Please contact the attorneys at Freeburg & Granieri, APC today to find out how we can help you implement an alternative workweek schedule.

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