If we ask a job applicant to demonstrate their job skills during an interview, do we have to pay them for their time?
During the hiring process, an employer may find it useful to ask an applicant to demonstrate how they would perform a job. For example, an employer might ask a candidate to demonstrate how they would paint a wall, cook a gourmet meal or lead an indoor rock-climbing class.
This is called “try-out” time and depending on what an applicant is asked to do in an interview, and how much time it takes, an employer may need to compensate them for their time.
According to the California Division of Labor Standards Enforcement (DLSE), there are three factors to consider when determining whether try-out time must be paid.
Is the testing time reasonable?
The first factor is whether the try-out time is “reasonable under the circumstances.” DLSE Policies and Interpretations Manual Sec. 46.8.
The amount of time needed to demonstrate a job skill will depend on the facts of each case. For example, it would take less time for an applicant to show how they would safely stack boxes than it would for an applicant to demonstrate the skills necessary to teach a ballet class.
According to the DLSE, the rate of pay for an occupation can be used as a guide to determine the amount of time necessary for a try-out. DLSE Policies and Interpretations Manual Sec. 46.8.1.
This means that higher paying jobs typically can require longer try-out periods. If the testing time is reasonable, then pay most likely will not be required.
Is the applicant performing any productive work?
A second factor is whether there is any productivity derived from the work the applicant performs. DLSE Policies and Interpretations Manual Sec. 46.8.
During a try-out, an applicant might be asked to demonstrate how they would varnish a piece of furniture. If that piece of furniture is then sold to a customer, then the employer is getting a benefit from the try-out time, and the applicant would have to be paid for their time.
To avoid having to pay an applicant for a try-out, employers should make sure that there is no productive work performed by a prospective employee during an interview.
Is the time, in fact, training as opposed to testing skills?
The third relevant factor is if the try-out time is used for training as opposed to testing job skills. DLSE Policies and Interpretations Manual Sec. 46.8.
For example, if an employer uses try-out time to teach an applicant how to use the employer’s computer software, the employer is deriving a benefit from the applicant’s try-out, and this time would have to be paid. If an employer uses the time solely to assess an applicant’s skill in using the software, this time will qualify as try-out time.
If in Doubt, Better to Compensate
Employers should be mindful of when an applicant’s demonstration of job skills requires pay. If a job skills demonstration takes an unreasonable amount of time or involves productive work or training that will benefit the employer, an employer will need to pay the applicant for their time.
If in doubt, the best practice is to compensate an applicant for the try-out time.