How Should You Compensate Your Employees for Being On Call?

Many businesses require employees to be on call for smooth operations, but compensating them can be challenging, requiring a balance of fairness and accountability. Four common methods of compensation are highlighted: voluntary on-call basis, where employees volunteer without formal compensation; fixed monthly fee, offering predictable income but potentially causing resentment if workload distribution is uneven; compensation based on exact hours, seen as the fairest but administratively demanding; and payment for time spent on incidents, which could motivate quick responses but might encourage a focus on short-term incident resolution. A more strategic alternative is compensating based on service availability, which incentivizes proactive measures to prevent incidents and aligns with maintaining high service uptime. The choice of method depends on an organization's size, culture, and needs, and should be fair, transparent, and aligned with business goals. Tools like PagerDuty can assist in tracking and calculating on-call hours, ensuring accurate compensation.