On April 19, 2013, Governor John Hickenlooper signed into law SB 13-018, otherwise known as "the Employment Opportunity Act." The Employment Opportunity Act prohibits employers from obtaining and using consumer credit information for employment purposes unless the credit information is "substantially related" to the position. 

Currently, there are only 8 other states where employment protections have been adopted for individuals who may have fallen on hard economic times, including California, Connecticut, Hawaii, Illinois, Maryland, Oregon, Vermont, and Washington.   

Colorado employers must comply with the Employment Opportunity Act on or before its effective date of July 1, 2013. Violators will be subject to Department of Labor investigations and civil penalties up to $2,500 per violation.

For more information on the Colorado Employment Opportunity Act and how to comply, see my prior posts here and here.

While many Coloradoans are taking advantage of their last few ski days of the season, the Colorado legislature has been busy passing new, groundbreaking legislation with respect to civil unions and the use of individual credit histories in employment decisions. How will this new legislation affect employers? Read on.

Colorado Civil Union Act

On March 21, 2013, Governor John Hickenlooper signed the Colorado Civil Union Act (SB13-011) (PDF) into law, authorizing 2 unmarried adults, regardless of gender, to enter into a civil union.

Effective May 1, 2013, among other rights, benefits and protections, the Colorado Civil Union Act provides that parties to a civil union in Colorado are granted the following:

• Dependent coverage under health insurance policies for plans issued, delivered, or renewed on or after January 1, 2014;
• Dependent coverage under life insurance for plans issued, delivered, or renewed on or after January 1, 2014;
• Prohibitions against discrimination based upon spousal status;
• Survivor benefits under and inclusion in workers' compensation laws;
• The right of a partner in a civil union to be treated as a family member or as a spouse under the "Colorado Employment Security Act" for purposes of unemployment benefits;
• Eligibility for family leave benefits;
• The ability to insure a party to a civil union under group benefit plans for state employees;
• The ability to designate a party to a civil union as a beneficiary under the state public employees retirement SB13-01 system;
• Survivor benefits under local government firefighter and police pensions;
• Protections and coverage under domestic abuse and domestic violence laws; and
• The ability to file a claim based on wrongful death, emotional distress, loss of consortium, dram shop, or other laws, whether common law or statutory, related to or dependent upon spousal status.

CBS 4 Denver reported on the signing of this historical legislation in Colorado, and also discussed that there are many supporters of same sex marriage who believe that the Civil Union Act was passed too soon in Colorado and will create complications involving 2 separate and unequal classes of citizens (i.e., same sex couples in a “civil union” and those in a “marriage”). The United States Supreme Court is currently hearing arguments on the constitutionality of the 1996 Defense of Marriage Act (DOMA), which is certain to have an impact on Colorado’s new law.

Employment Opportunity Act

On March 25, 2013, the House passed its Third Reading of the Employment Opportunity Act (SB13-018) (PDF), which sets forth the permissible use of credit information with regard to hiring and other employment decisions. I previously posted a summary of the Employment Opportunity Act, which affects all employers in Colorado with 4 or more employees.

Now that the Employment Opportunity Act has passed the Senate and the House, the bill will briefly go back to the Senate (where the bill originated) to approve the amendments by the House. If the Senate accepts the changes, which is anticipated, it goes to the Governor to be vetoed or signed into law. Will the Governor sign the Employment Opportunity Act into law? It is likely not a matter of if but when, and all signs point to the final stamp of approval soon since the Act’s effective date is July 1, 2013.

By the way, if anyone is interested to see how a bill becomes law in Colorado, the Colorado Legislative website has a nifty flow chart with pictures (PDF).

What Should Employers Do Now?

Small, medium and large sized businesses/employers must be aware of these new rights, benefits and protections that go into effect May 1, 2013 (Civil Union Act) and July 1, 2013 (Employment Opportunity Act). Steps should be taken to modify benefit policies and enrollment forms relating to individuals in civil unions for Colorado plans issued or renewed on or after January 1, 2014. In addition, employers are wise to dust off and review their employment policies to ensure all written policies are fully compliant with these and all other applicable new laws.

Last but not least, do not hesitate to engage competent employment counsel, before a claim arises, so that you are properly informed of and can stay on top of the ever-changing laws, rules and regulations affecting employment in Colorado.

As of January 1, 2013, Colorado's minimum wage increased from $7.64 per hour to $7.78 per hour, with tipped employee's minimum wage increasing from $4.62 per hour to $4.76 per hour. The Colorado Division of Labor adopted Colorado Minimum Wage Order Number 29 (PDF) to reflect the new state minimum wage.  The Minimum Wage Order also provides important information about meal periods and rest breaks in Colorado.  

Where employees are covered by federal and Colorado state minimum wage laws, the employer must pay the higher minimum wage. Currently, the federal minimum wage is $7.25 per hour, which is lower than Colorado's minimum wage of $7.78 per hour. Thus, beginning January 1, 2013, employers in Colorado must ensure all employees receive at least $7.78 per hour for all hours worked (or $4.76 per hour for tipped employees).

Effective January 1, 2012, Colorado's minimum wage increased by $0.28, from $7.36 per hour to $7.64 per hour (for tipped employees, from $4.34 to $4.62).  This is $0.39 more than the federal minimum wage of $7.25 per hour.  

The new minimum wage requirement is set forth in Colorado Minimum Wage Order 28 (PDF) now in effect. Because employers in Colorado must comply with both federal (Fair Labor Standards Act) and state (Colorado Wage Act) laws, the higher prevailing wage must be paid to employees.

This $0.28 increase represents the 3.8% increase to the Denver-Boulder-Greeley Consumer Price Index (CPI) from 2010 to 2011. Colorado is one of eight states with a minimum wage tied to inflation. The other states include Arizona, Florida, Montana, Ohio, Oregon, Vermont, and Washington. Colorado's inflationary adjustment requirement was passed by a relatively close vote on Amendment 42 to the Colorado Constitution in 2006 (823,526 in favor; 721,530 against).

According to the Bell Policy Center in Denver, and as reported by the Denver Post, this year's minimum wage increase will affect 74,000 workers in Colorado, or 3.4% of Colorado's workforce.  

More information about the 2012 Colorado minimum wage increase can be found on the Colorado Department of Labor website.

Promoting public health? Sounds good. Making sure working adults stay at home when they are sick? I'm on board. Flexible and supportive working environment? Of course, who doesn't want that.

Voters in San Francisco, Washington D.C., Milwaukee, and Connecticut were motivated by these ideals when passing paid sick leave ordinances or bills in their cities or state (although Wisconsin Governor Scott Walker nullified Milwaukee's bill after it was passed). You can bet voters in Denver, too, will be equally motivated by these ideals and the desire to help working families and low income wage earners when deciding Ballot Initiative 300 in November 2011. 

But, what exactly is the proposed Denver Paid Sick and Safe Time Ordinance (PDF), and is it really a good idea for Denver?   

Key Provisions of Denver's Proposed Paid Sick and Safe Time Ordinance

• Provides paid sick and safe time leave for all employees within the geographic boundaries of the City and County of Denver, including part-time and temporary employees, who work at least 40 hours a year (federal and state government employees and union members are exempt).
• All Colorado employers who employ eligible workers in the City and County of Denver must comply, regardless of size, but new businesses are exempt during their first year of operation.
• Paid leave would accrue at the rate of 1 hour for every 30 hours worked.  
• Large employers, defined as employers with 10 or more employees, must offer up to 72 hours, or 9 days, of paid leave each calendar year.  
• Small employers, defined as those with less than 10 employees, must offer up to 40 hours, or 5 days, of paid leave each calendar year.  
• Up to 72 hours, or 9 days, of paid leave may be carried over from year to year.
• Paid leave may be taken after 90 days of employment, and may be taken in as few as 1 hour increments.  
• No advance notice is required for an employee to take leave.
• No documentation is required until the employee takes 3 or more consecutive days off.
• Employers cannot require employees to search for, or provide, a replacement worker to cover the hours missed.
• Employers cannot "take retaliatory personnel action or discriminate" against employees exercising their sick and safe time rights.
• Paid leave can be taken for:  
  • An employee's own mental or physical illness, injury, health condition, need for medical care or treatment, or need for a medical procedure or preventative medical care;
  • To care for an employee's family member's mental or physical illness, injury, health condition, need for medical care or treatment, or who needs a medical procedure or preventative medical care;
  • The closure of the employee's place of business, or to care for a child whose school or place of care has been closed, due to a public health emergency;
  • To seek a civil protection order to prevent domestic abuse pursuant to Section 13-14-102, C.R.S.;
  • To obtain medical care or mental health counseling, or both, for the employee or employee's children to address physical or psychological injuries from domestic abuse, stalking, sexual assault, or other crime involving domestic violence;
  • To make the employee's home secure, or to seek new housing, due to domestic abuse, stalking, sexual assault, or other crime involving domestic violence; and
  • To seek legal assistance to address issues arising from domestic abuse, stalking, sexual assault, or other crime involving domestic violence, and attend or prepare for court-related proceedings.

Unclear and Potentially Troublesome Provisions

1.  Definition of "Family Member" Too Broad

Although seemingly modeled after the San Francisco and D.C. bills, Denver's new paid leave ordinance includes a far broader definition of "family member" than any prior bill passed. It includes:  

* A person related by blood, marriage or legal adoption, including a child, parent, spouse, sibling, grandparent, or grandchild of the employee;

* A foster child, parent, sibling, grandparent, or grandchild of the employee;

* A child to whom the employee stands in loco parentis or for whom the employee is the legal guardian;

* The employee's domestic partner;

* The spouse of an employee's child, parent, sibling, or grandparent;

* A legal guardian of the employee or a person who stood in loco parentis to the employee when he or she was a minor;

* A parent of the employee's spouse; or

* Any other individual related by blood or affinity whose close relationship is equivalent to a family relationship.

The spouse of an employee's sibling? Call me crazy, but I think it is a real problem to obligate a small business owner to provide paid time off for an employee to take his or her sister's husband to a routine doctor's appointment. Or, to leave open all the possible individuals covered under the vague phrase "any other individual related by blood or affinity whose close relationship is equivalent to a family relationship." I wonder when we would see the first complaint involving a worker claiming that his or her college roommate is "like family."

2.  Unclear How to Count Number of Employees or Who May Be Eligible

It is unclear how employers will be required to count their number of employees to determine the amount of leave benefits that must be offered.  The definition of employer includes all businesses in the State of Colorado.  But, the definition of an eligible employee is anyone employed within the geographic boundaries of the City and County of Denver.  So, for purposes of determining the amount of leave benefits, are employers required to count all employees in Colorado, or only those employed within the City and County of Denver?  

Likewise, if employees need only be employed in the City of County of Denver for 40 hours a year to be eligible, is a worker whose main office is located elsewhere in Colorado, but who travels to Denver frequently throughout the year for deliveries or to conduct business, eligible for the mandated leave benefits? 

3.  No Advance Notice Required

Where other paid sick leave bills expressly authorize employers to require reasonable notice to be given where practicable when an employee's need for leave arises, Denver's new proposed ordinance vaguely says that employers "may not impose unreasonable barriers to use of paid sick and safe time."  What does that mean?  An "unreasonable barrier" in one instance could be reasonable under different circumstances. The use of such vague language, rather than clear language allowing employers to require advance notice where practicable, in my view, tips the scale of this legislation away from fair and balanced.   

4.  Employers Prohibited From Requesting Documentation

Additionally, where other sick leave bills allow employers to require appropriate documentation to support the leave to prevent abuse, Denver's proposed ordinance prohibits employers from requesting any documentation, until after 3 consecutive days of absence.

5.  Employers Already Offering Generous Leave Benefits Not Necessarily Exempt

Finally, even though the new ordinance attempts to exempt employers who already provide vacation or personal time off (PTO) in an amount equivalent or greater than the mandated 9 (or 5) days of leave benefits, the rub is that employers must allow the vacation or PTO "under the same conditions as paid sick and safe time" - meaning that if the other leave benefits require prior notice and/or documentation, this new leave bank must be provided in addition.  This is another major difference between Denver's proposed sick leave ordinance than those passed in San Francisco, D.C. and Connecticut. At least in those ordinances or bills, employers who offered more leave days than that legislatively mandated, were deemed in compliance, without all the other restrictions.  

Food for Thought

The Agency for Human Rights and Community Relations (staffed currently by 10 people) in Denver would be responsible for implementing and administering this new law, taking complaints, conducting investigations, holding hearings, providing conciliation, issuing orders, and imposing fines. With only 10 individuals currently in the Agency, the implementation of this new ordinance along with a potential influx of complaints may likely require expansion, using already-tight taxpayer dollars.

Everyone knows that successful, long-term and mutually beneficial employment relationships require employees and employers to work together, and there are a multitude of good employers in Denver and throughout Colorado who strive to keep their workforce happy with generous benefit packages. I am certainly not advocating that employees come to work sick or face losing their job if their child is sent home from school sick.  But, is imposing overly broad, vague legislation with unusually restrictive obligations on large and small employers alike, however good in principal, what Denver needs in this economic climate? Governor John Hickenlooper and Mayor Michael Hancock say no, and it is now up to Denver voters to decide in November. 

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UPDATE:  Since first publishing this blog post, Seattle passed its version of paid sick leave legislation in September 2011.  Seattle's 50-page ordinance was approved by the City Council on September 12, 2011 and signed into law by the Mayor on September 23, 2011.  Although I have not done a complete side-by-side comparison with Denver's proposed ordinance, one primary difference is that Seattle's ordinance provides that employees must work at least 240 hours per year in Seattle to be eligible, while Denver's proposed ordinance provides leave benefits for eligible employees who work only 40 hours each calendar year. 

I have received quite a few requests for inclement weather policies of late, and since the topic of "snow days" frequently arises this time of year, I wanted to provide some (hopefully) useful information for employers.  The question of whether an employer is obligated to pay employees for "snow days" depends largely on two questions:

1. Is the employee exempt (salaried) or non-exempt (hourly)?
2. Is the office open or closed? 

Is the Employee Exempt (Salaried) or Non-Exempt (Hourly)?

If an employee is exempt (i.e., employed in a bona fide executive, administrative, or professional capacity and paid on a salary basis of not less than $455 per week), then the general rule of thumb is that the employee must be paid his or her full salary for any week in which he or she performs any work, regardless of the number of days or hours worked.  Of course, there are certain exceptions to this general rule, including FMLA leave, the first or last weeks of employment, where no work is performed for an entire workweek, or, as discussed below, if the office is open and the exempt employee elects to not report to work for a full work day. 

If an employee is non-exempt (i.e., employed on an hourly basis and subject to the minimum wage and overtime requirements of the Fair Labor Standards Act (FLSA)), the employee need not be paid for time not worked regardless of whether the office is open or closed. (Keep in mind that whether an employer is obligated under the law to pay and whether it should pay hourly employees to keep employees happy are separate issues).

Is the Office Open or Closed?

Next, the answer to the question of whether the office is open or closed, affects only exempt, salaried employees, as non-exempt, hourly employees need not be paid for time not worked.  If the office is open, but there is transportation difficulty, fear of driving in weather conditions, etc., causing an exempt employee to voluntarily elect not to come in at all, then the employer may deduct a "full day" absence from the employee's salary. 

In the event the office is closed, meaning that the employer officially shut down operations due to inclement weather or other emergency and told folks to go home or not come in at all, the employer is still obligated to pay all exempt, salaried employees their full salary.  Simply put, no deductions can be made if exempt employees are "ready, willing and able to work," but there just happens to be no work available. 

Finally, a couple of caveats:

• Employers must always be mindful of the "full day" rule.  If an exempt, salaried employee is voluntarily absent from work for a partial day or for 1 1/2 days, the employer cannot deduct for any partial day absence and can only deduct for an actual "full day" missed.  Again, a "full day" deduction, however, is only permissible if the office is open and the employee voluntarily elects to stay home.  It is not proper to make a "full day" deduction if the office is officially closed, as the employee has no choice in the matter.
• Likewise, while there is no prohibition on employers asking both exempt and non-exempt employees to use personal, sick or vacation time for missed hours or days due to a "snow day," in no event should an exempt, salaried employee's time be treated as unpaid when the office is officially closed (even if an employee has no accrued time off benefits). 

Example: Jane is a salaried employee.  ABC Company decides to officially close the office due to a blizzard and notifies all employees to either not come in at all or to leave early.  ABC Company's policy is that employees must apply PTO time to the time missed, but Jane took a trip to Aruba recently and is currently out of accrued PTO time.  Even though she has no accrued time off, ABC Company still must pay Jane for the "snow day."

The information above is in line with two opinion letters issued by the Department of Labor on the proper payment of wages under the FLSA when inclement weather occurs: Opinion Letter FLSA2005-41, October 24, 2005 and Opinion Letter FLSA2005-46, October 28, 2005.  Note that the DOL has announced that it will no longer issue Opinion Letters; however, existing Opinion Letters still serve as interpretative guidance absent a subsequent Administrative Interpretation providing otherwise.

Inclement Weather Policy

Lastly, should employers have an inclement weather policy in place?  YES.  Employees and management alike are well-served with a clearly drafted policy on how the company will compensate its employees for "snow days."  Here is a sample inclement weather policy: Sample Policy.pdf with the footnote that it should be used as an example only.  Given the various nuances discussed above and with the FLSA generally, any inclement weather policy should be carefully drafted according to a company's specific needs and reviewed by competent employment counsel before being adopted and distributed to employees.

Happy New Year!  I know I am more than happy to say goodbye to 2010, am looking forward to all the possibilities of 2011, and hope that anyone taking the time to read my blog is also off to a good start this new year.

On this First Monday of 2011, Colorado employers take note:

1. The new Colorado minimum wage increased to $7.36 per hour effective January 1, 2011 (with tipped employees at $4.34/hour) - a $0.12 increase from the last change to Colorado's minimum wage as of January 1, 2010 ($7.24) and $0.11 more than the federal minimum wage effective July 24, 2009 ($7.25).  When both the federal Fair Labor Standards Act and a state law apply, the higher standard must be observed.  Ergo, Colorado employers must ensure all non-exempt, hourly employees are making at least $7.36 per hour as of the start of 2011. 
2. The Payroll Tax Holiday of 2011 begins.  This is part of the new tax deal that Congress and President Obama put through in December to extend Bush-era tax cuts through 2012.  In addition to extending unemployment benefits, the new deal provides that employee side payroll tax contributions for Social Security taxes will be reduced by 2% (up to $106,800).  So, instead of seeing withholdings of 6.2% of wages for Social Security, employees should see more money in their paychecks with a lesser withholding of only 4.2% (employers still have to pay their 6.2%).  TaxGirl explains this change nicely on her blog.
3. The Colorado Supreme Court did not issue any opinions this First Monday of 2011, but denied certioriari in 29 cases (PDF). 
4. Ellen Golombek is named the new Executive Director of the Colorado Department of Labor and Employment under Governor-Elect John Hickenlooper.  Golomobek is the former (and first woman to serve as) President of the Colorado AFL-CIO, a former Government Affairs Assistant with the Service Employees International Union, and most recently, served as the Colorado State Director for America Votes, a voter-rights organization.  As exemplified by Senate Minority Leader Mike Kopp's comments:

“Governor-elect Hickenlooper’s appointment to the Department of Labor may certainly take some of the air out of the bipartisan atmosphere he has promised to promote as Governor. His selection of a noted progressive activist and union boss in Ms. Golombek certainly will raise plenty of eyebrows in Colorado’s business community. And for good reason.”

this appointment is proving to be rather controversial.