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Colorado Has New Wage Laws in 2015

Effective on January 1, 2015 and applying to claims arising from that date, Colorado has a new wage Law.

The Wage Protection Act of 2014 expands the state’s wage payment law to include additional types of claims, and gives the Colorado Division of Labor in the Department of Labor and Employment (CDLE) more authority and resources to pursue wage claims on behalf of employees. The law applies to nearly every private employer in Colorado who employs even a single employee.

Expanded Coverage

Previously, employees could only pursue claims for unpaid wages after their employment was terminated. Under the new Act, employees may assert wage claims while still employed.

The Act also includes new provisions for attorneys’ fees to the remedies that may be recovered by an employee paid less than minimum wage; changes the notice of claim requirements; adds a recordkeeping requirement; grants employees access to records; and provides the CDLE with authority and resources to adjudicate claims and impose new fines and penalties.

Early Notice of Claim No Longer Required

Beginning January 1, 2015, employees will no longer be required to make a written demand on their employers within 60 days of their job separation to trigger penalties for nonpayment. Employees have two years to file a complaint with the division or a court, and notice of the filing of a complaint will trigger the penalty provision. Penalties will also accrue from the date the wages were owed, rather than from the date of demand.

New Fines and Penalties

Also beginning January 1, 2015, the CDLE may fine employers (but not employees) $250 for failing to timely respond to a notice from the CDLE. Failure or refusal to testify or produce records in response to a CDLE subpoena will be a misdemeanor, punishable by a $200 fine, 60 days in jail or both, and each day of a failure or refusal will be a separate offense.

The Act authorizes the CDLE to collect fines and penalties without a hearing. Fines imposed will be credited to a “wage theft enforcement fund” created to pay the division’s costs.

Administrative Adjudication

The new law directs the CDLE to establish an administrative procedure for adjudicating claims of $7,500 or less for wages earned on or after January 1, 2015 and allocates funds for enforcement. Under the new procedure, the CDLE will notify the employer of the complaint and, unless the employer pays the full amount demanded within 14 days of the notice, the CDLE will investigate the complaint and issue a determination within 90 days.

If the CDLE determines that the employer owes wages, the CDLE must issue a citation and assessment for the wages owed that includes fines and penalties. If, within 14 days of the determination, the employer tenders the wages determined to be due, the CDLE may, but is not required to, waive or reduce the fines and reduce the penalties by up to 50%.

An employee is not required to accept the amount tendered. Within 35 days of the determination, the employee may choose to terminate the administrative process and file a court complaint.

Alternatively, any interested party may appeal a determination within 35 days to a hearing officer to be selected by the CDLE. The hearing officer’s decision may be appealed to a court, and court review will be limited to appeal briefs and the record.

Additional Changes

Also effective January 1, 2015:

  • an employee who receives less than the legal minimum wage will be able to recover attorneys’ fees in a civil action in addition to the unpaid wages and costs of suit;
  • employers must maintain records reflecting the information in an employee’s pay statement for at least three years after payment of the wages and provide copies of the records to the CDLE or to an employee on request (the CDLE may fine an employer up to $250 per month, per employee, up to a total of $7,500 for violations), and;
  • if an employer makes final wages available at a work site or local office and an employee has not received them within 60 days of the date they were due, the employer must mail the check to the employee’s last known address.
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