A communication system having a base station and a number of field units employs a virtual hold technique and a self-testing technique. In the virtual hold technique, when a field unit is put on hold, the communication channel previously used by the field unit is released for use elsewhere in the system, thereby increasing the efficiency of the system. In the self-test technique, a test signal is transmitted to the field unit where it is applied to the earpiece of a handset so as to generate sound waves which are picked up by the microphone in the mouthpiece of the handset and transmitted back to the base station for comparison with the original test signal. In this manner, the entire communication loop is tested without the need for human intervention, and in particular without the need for a person to be present at the field unit. The self-test technique improves the reliability of the system.