Many call centers have used the approach you describe. Giving estimated delay messages is another approach that is used. These are not ideal for long delays, as you note -- the best solution is to address the call center staffing issues and schedule the appropriate number of people for the fluctuations in volume. But given the challenges, it is generally good to inform the caller and give them choices about what's best for them -- wait now, or call back when it might be a better time. A "best practice" is to give the customer informed control over their situation.
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