labor law guide
The Colorado employment laws every business owner should know
Wages and breaks
The 2021 minimum wage for tipped employees is $9.30
Employers must ensure their tipped employees are making the regular minimum wage rate of $11.10 with the combined tipped minimum wage and their tips. If they are not, the employer must make up the difference.
Employers are prohibited from taking control of an employee’s tips, but they may implement a mandatory tip pooling or sharing policy as long as they provide written notice to patrons, such as on a menu or receipt.
Employers are required to pay employees an overtime rate of 1 ½ time their regular pay when they work for a total number of hours in excess of 40 in a workweek, more than 12 hours in a workday or 12 consecutive hours with no workday regard.
The federal overtime rule stipulates that the minimum salary requirement for administrative, professional, and executive exemptions is $684 per week, or $35,568 per year. Workers making at least this salary level may be eligible for overtime based on their job duties.
Employers in the retail and service, food and beverage, commercial support services, or health and medical industries must provide employees with a duty-free meal period of 30 minutes for every consecutive 5 hours worked.
The break may be unpaid unless an “on-duty” meal must be consumed, at which point the employee must be compensated.
Employers in the retail and service, food and beverage, commercial support services, or health and medical industries must provide employees with a 10-minute, paid break in the middle of the shift (if possible) for every 4 hours worked.
Employers in other industries are not required to provide a break, but if they choose to do so, breaks less than 20 minutes must be paid.
Final paychecks in Colorado
Employers must pay fired or laid-off employees immediately after discharging them, or within 6 hours of the start of the next business day if the payroll office is closed.
If an employee resigns or is suspended, the employer has until the next scheduled payday to provide the final paycheck.
Colorado child labor laws
Minors are not allowed to work more than 40 hours a week or more than 8 hours in any 24-hour period.
Minors under the age of 16 may not work more than 6 hours unless the next day is not a school day. They also may not work between the hours of 9:30 p.m. and 5:00 a.m. unless the next day is not a school day.
During a school day, they may not work more than 3 hours (including Fridays) or more than 18 hours during a school week.
Employers with at least 16 team members must require employees to accrue at least one hour of paid sick and safe time leave for every 30 hours of work, with a maximum of 48 hours a year by January 1, 2021.
All employers will be required to follow the rule on January 1, 2022.
Similar to the federal Family and Medical Leave Act, the Colorado Family Care Act applies to employers with 50 or more employees and provides leave for an employee to care for a family member who has a serious health condition.
In addition to medical leave to care for spouses and immediate family, which is provided under the federal FMLA, Colorado’s Family Care Act provides an extra 40 hours of state family medical leave and expands coverage to include an employee’s partner in a civil or domestic partnership, children of any age, parents-in-law, siblings, grandchildren, and grandparents.
Employers are not required to provide bereavement leave, but may be required to comply with any bereavement policy they may have.
Employers are not required to provide vacation leave but must comply with their own established policies if they choose to implement one.
Employees must be paid for any accrued vacation time upon separation of employment.
The amount of vacation time an employee can accrue may be capped by the employer.
Employers can implement a “use-it-or-lose-it” policy that requires employees to use their vacation time by a set date, but there are strict guidelines, including the employer’s historical practices, industry norms, the understandings of the employer and employees, and other considerations that may explain when the vacation time becomes “earned” under the specific policy.
Private employers are not required to provide holiday leave but must comply with their own established policies if they choose to implement one.
Employees must be paid up to $50 a day for the first 3 days of jury duty, unless another agreement has been made.
Employees are to be given up to 2 hours of paid leave to vote, unless the employee did not request leave at least one day before the vote, or the employee has 3 or more hours to vote before or after their shift.
Employers must allow their employees who are members of the National Guard or the reserves to take up to 15 days of military leave. After their service, the employee is entitled to return to their job.
Employers must provide an employee who is a “qualified volunteer” with up to 15 days a year of leave to respond to an emergency.
“Qualified volunteer” means that the employee is a volunteer with a volunteer organization registered with the Colorado Department of Local Affairs, is called to duty by the county sheriff, local government, local emergency planning committee, or state agency, and obtains verification of their need for leave.
Employers with at least 50 employees must provide leave to an employee who is the victim of domestic violence, stalking, or sexual assault. The employee is entitled to take up to three days of leave from work in any 12-month period to obtain a restraining order, seek medical or mental health care, secure a home, seek legal advice, or participate in a legal proceeding. The employer must keep the information regarding the employee’s leave confidential.
Employees forced to leave work because of domestic violence-related issues may still be eligible for unemployment benefits.
Hiring and firing
Federal law makes it illegal for an employer to discriminate on the basis of: Race, Color, Age, Sex, Sexual orientation, Gender, Gender identity, Religion, National origin, Pregnancy, Genetic information, including family medical history, Physical or mental disability, Child or spousal support withholding, Military or veteran status, Citizenship and/or immigration status.
Additionally, Colorado law makes it illegal to discriminate on the basis of: Lawful activity outside of work, AIDS/HIV, arrest or sealed conviction records, marriage to a co-employee, Civil Air Patrol membership, credit report or credit information, or wage garnishment for consumer debt.
Under the Colorado Pregnant Workers Fairness Act, if an applicant or employee who is pregnant or has a condition related to pregnancy or childbirth requests an accommodation, an employer must provide a reasonable accommodation to perform the essential functions of the applicant or employee’s job unless the accommodation would impose an undue hardship.
The Equal Pay for Equal Work Act prohibits employers from discriminating against employees on the basis of sex by paying staff differently for “substantially” similar roles based on their skill level, responsibility, and effort due to their gender.
However, if an employer can prove that the pay difference is based on seniority, merit, location, training, experience, or necessary travel, the pay difference is allowed.
Colorado is an employment-at-will state, which means that without a written employee contract, employees can be terminated for any reason at any time, provided that the reason is not discriminatory and that the employer is not retaliating against the employee for a rightful action.
Regarding employment and payroll data, under the Fair Labor Standards Act (FLSA) and others, you must:
For at least 3 years: keep payroll records, certificates, agreements, notices, collective bargaining agreements, employment contracts, and sales and purchase records. Also keep completed copies of each employee’s I-9 for three years after they are hired. If the employee works longer than three years, hold on to the form for at least one year after the employee leaves.
For at least 2 years: Keep basic employment and earning records like timecards, wage-rate tables, shipping and billing records, and records of additions to or deductions from wages. Also keep the records that show why you may pay different wages to employees of different sexes, such as wage rates, job evaluations, seniority and merit systems, and collective bargaining agreements.
For at least 1 year: The Equal Employment Opportunity Commission says employers should keep all employment records for at least one year from the employee’s date of termination.
Other record-keeping laws that may apply to you:
Under the Occupational Safety and Health Act, you need to keep records of job-related injuries and illnesses for five years. But some records, like those covering toxic substance exposure, have to be kept for 30 years.
You must keep files of benefit plans and seniority and merit systems while they are in effect and for at least a year after they end. You must also retain summary descriptions and annual reports of benefits plans for six years.
If your company is covered by the Family and Medical Leave Act, you must also retain relevant records of leaves, notices, policies, and more for three years.
As of January 1, 2021, employers are not allowed to ask candidates about their salary history. If the employer does learn the history of the employee’s salary, they may not use that information to determine their pay.
Employers are required to announce all internal job openings, and make a “reasonable effort” include salary range for every job posting, internal and external. Along with the salary range, employers must also list a general description of benefits and other compensation.
Additional laws that may apply to you.
Employers are free to run a background check at any point in the hiring process and to inquire about an applicant’s criminal history before, during, or after an interview, so long as the inquiry is not part of the initial application.
Employers are not allowed to state in an application that those with a criminal background need not apply.
Employers with fewer than 11 team members have until September 1, 2021 to follow this rule.
Colorado requires a fingerprint-based criminal history records check for the following types of employees: school/childcare personnel, real estate industry employees, massage therapists, owners and administrators of assisted living facilities, bail bondsmen, attorneys, pharmacists, camp employees, foster care employees, EMTs, gaming equipment contractors, home care agency workers, lottery commission, money transmitters, racing commission, security guards, medical and retail marijuana sellers, manufacturers, and cultivators.
Employers that have four or more employees may not obtain a credit check on applicants or employees, unless obtaining a credit report is related to the position.
Employers may not require or use information related to sealed records or non-conviction arrests for civil or military disobedience.
Colorado has a “Ban the Box” law. Under the law employers are prohibited from: Stating on a job ad or application that someone with a criminal history may not apply, or asking about criminal histories on an initial job application.
These restrictions do not apply if the employer is required by law to run a background check on that type of position or if a person with a specific kind of criminal history is prohibited from holding that position by law.
Employers are still free to run a background check at any point in the hiring process and to inquire about an applicant’s criminal history before, during, or after an interview, so long as the inquiry is not part of the initial application.
Employers that are healthcare providers may not discharge or discriminate against an employee for making a good-faith report about patient safety or care.
In addition, employers that have a contract with the state may not discharge or discriminate against an employee for reporting a potential waste of public funds, endangerment of public health, safety, or welfare, or other adverse effects to the interests of the state.
Colorado prohibits employers from discharging, discriminating against, or interfering with an employee because they asked about or discussed their wages, requiring an employee to agree to refrain from disclosing their wages, and requiring an employee to waive their right to disclose their wages.
COBRA is a federal law that allows many employees to continue their health insurance benefits after their employment ends. Because federal COBRA only applies to employers that have 20 or more employees, many states have adopted their own versions of the law, which are known as “mini-COBRAs.”
Colorado’s mini-COBRA allows employees to continue their coverage for up to 18 months. Employers must provide an employee with a notice of their COBRA rights within 10 days of the triggering event.
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This summary is not qualified legal advice. Laws are always subject to change, and they can vary from municipality to municipality. It’s up to you to make sure you’re compliant with all laws and statutes in your area. If you need more compliance help, we recommend consulting with a qualified lawyer, checking with your local government agencies, or signing up for Homebase to get help from our certified HR Pros.