How on-call duty works
The company publishes an on-call roster, such as one IT engineer per week for after-hours incidents. The on-call person keeps their phone on, stays within a set travel time of the site if a visit might be needed, and responds within an agreed time, such as 15 or 30 minutes. If no call comes, they spend the period as they like within those limits. If a call comes, the time spent working is recorded, usually from the call or login until the problem is closed.
Paying for on-call time
Companies usually pay a fixed on-call allowance for being available, such as a sum per night or per weekend, and separately pay for time actually worked when called. Where a call-out takes an employee beyond the prescribed hours, that time is overtime, paid at twice the ordinary wage rate with the worker's consent, under the overtime rules. Some firms give comp off for weekend call-outs instead, where the policy and the employee's category allow it.
On-call versus standby duty
The difference is where the employee waits. An on-call engineer can be at home, at a family dinner or asleep, and only has to answer the phone and respond within the agreed time. A standby employee has to stay at the site or close to it, able to begin work the moment they are needed, so their time is far more restricted. Because of that, companies commonly treat standby as working time, while on-call is usually covered by an allowance until a call comes. Write the distinction into the policy.
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Is on-call time counted as working hours?
Usually only the time actually spent responding counts as work, while the waiting time is covered by an on-call allowance. That changes if the employee is so restricted during on-call, for example required to stay at the site, that they cannot use the time for themselves. Then it is closer to standby duty, and many companies treat it as working time.
Do employees get paid for being on call?
Commonly, yes: a fixed allowance per night, weekend or week for being available, plus payment or comp off for time actually worked when called. The rates are set by company policy. Without any allowance, long on-call rotations quickly become a source of complaints and resignations, especially in small teams where the same few people carry the phone.