Colorado state experienced several important legal changes in 2019 that impact all employers. To ensure you are compliant with the state and federal changes, we have prepared this Employer Checklist with 10 important reminders plus a bonus section on additional changes employers should pay close attention to in 2020:
1) Review Your Employee Handbook. Employers should review and update their Employee Handbook to ensure ongoing compliance with state and federal employment laws. For example, Colorado state implemented several changes recently that should be included in your 2020 Handbook:
Workplace accommodations for nursing mothers
New data security employer requirements
Compliance with Colorado’s vacation time “use it or lose it” rules
Don’t forget to collect a new Acknowledgement form from each employee anytime you make change to the Handbook!
2) Comply with Ban-The-Box. Effective September 2019, employers must comply with Colorado’s new “Ban the Box” law preventing employers from inquiring about criminal history on the application and during the recruiting process. To comply, employers should make the following changes:
Don’t advertise that a person with a criminal history may not apply for a position
Don’t include a statement on your employment application stating that a person with a criminal history may not apply
Don’t inquire about criminal history on the initial employment application
You can conduct background checks as needed but it should be separate from the initial employment application process and only after the contingent offer of employment has been accepted.
3) New DOL Overtime Rule. Effective January 1, 2020, employers need to comply with the new federal exempt minimum wage, which states:
Salaried employees must now earn a minimum of $35,568 per year (or $684 per week).
Employers can now use nondiscretionary bonuses, incentives, and commissions to meet up to 10% of the new minimum salary level, provided the payments are made at least annually.
Employees exempt under the Highly Compensated Employee exemption must earn at least $107,432 annually.
If you have salaried employees earning less than the new minimum, employers should either 1) increase the salary to the new minimum or 2) convert the employee to hourly. During this process, it’s also a good time to review the other exempt requirements to ensure the position remains eligible for an exemption.
4) Colorado State Minimum Wage and Tip Pooling Changes.
Effective January 1, 2020, Colorado state minimum wage increases to $12.00. Tipped Employee minimum wage increases to $8.98.
Effective August 2019, Colorado state law changed to reflect that tips are now the sole property of the employee receiving them unless the employer publishes a notice on menus, table tents, or receipts that informs each customer that tips are shared by employees. It now is unlawful for the employer to assert any claim, right to, or control over tips. For more information, visit: https://www.colorado.gov/pacific/cdle/tipped-employees.
5) City of Denver’s New Minimum Wage. Effective January 1, 2020, employers with a work location in the city of Denver will need to comply with Denver’s new minimum wage of $12.85. This only applies to employees who work in the Denver location.
6) Form I-9s. Employers are encouraged to conduct an annual audit of Form I-9s to ensure you have a complete form for each employee and destroy any documents no longer required under the retention requirements:
Employers are required to maintain Form I-9s for the length of active employment
Terminated employee I-9s must be retained for three (3) years after hire date or one (1) year after termination, whichever is longer
To reduce errors when completing the form (which can lead to costly fines!), employers are encouraged to use the most current Form I-9 which can now be completed electronically.
7) Harassment Prevention Training. Do you have employees in New York or California? Ensure you are complying with state training requirements. All other employers are encouraged to conduct Harassment Prevention training every two years.
8) New Hire Reporting. Ensure you are reporting all new hires to the State Directory of New Hires, per Colorado state law. State law requires that new hires are reported within 20 days of hire.
9) Labor Law Posters. It’s time to order your 2020 labor law posters! Posters must be hung in a common area, such as a break room. We strongly encourage employers subscribe to a recurring service which will automatically send you new posters as they are required by the DOL.
10) W2 Preparation. It’s a good time of year to ask employees to review and update their address to ensure W2s are mailed to the correct address. Use this opportunity to also request updates to emergency contact information as well.
BONUS SECTION: WHAT EMPLOYERS SHOULD EXPECT IN 2020
Colorado Cities Setting a New Minimum Wage
Colorado recently repealed a ban that prevented cities from setting a minimum wage for their jurisdiction. This gives cities the flexibility to address the employment needs of their residents. The city of Denver was first to exercise their right under this new law and we expect other cities to follow in 2020.
Updates to the Colorado Minimum Wage Order
A current bill is being proposed that will change Colorado’s Minimum Wage Order to increase the state exempt minimum wage even higher than the new federal minimum. Colorado is proposing that the new exempt minimum wage would be $42,000, which is expected to pass in 2020.
Ten (10) states, the District of Columbia and 22 other jurisdictions have or will soon have paid sick days laws in effect. More states are expected to follow, including Colorado.
Preparing for Colorado’s New “Equal Pay for Equal Work” Act
Effective January 2, 2021, Colorado’s “Equal Pay for Equal Work” prohibits discrimination in wages based on sex for all Colorado employers. Employer should begin adjusting their recruiting processes accordingly:
Don’t inquire about compensation history of job applicants
Don’t rely on prior wage rates to determine a wage rate
Don’t discriminate or retaliate against a prospective employee for failing to disclose their wage rate history
Employers will be required to announce all job openings and the respective pay range to all current employees