Colorado’s 2019 legislative session was busy, including producing a trio of new employment laws that tighten regulations on employers in the areas of pay equity, criminal history inquiries and wage theft. Employers face comprehensive changes and should review pay practices, application processes, advancement and promotion policies, and employee record-keeping to comply with these new laws.
Restrictions on Criminal History Inquiries in the Job Application Process
The Colorado Chance to Compete Act restricts an employer’s use of criminal history in the job advertisement and application process. The act applies to all nongovernment employers and employment agencies. With the passage of the act, Colorado becomes the 13th state (in addition to several localities) with a “ban the box” law for private employers.
Under the act, an employer may not:
- State in an advertisement that a job position is not open to those with a criminal history;
- State in an application form that a person with a criminal history may not apply; or
- Inquire or compel disclosure of an applicant’s criminal history in an initial application.
The new statute excepts certain employment situations from the new requirements, including when:
- Any laws or regulations prohibit employment of a person with a specific criminal history in that position.
- The position is offered as part of any government program to encourage employment of those with criminal histories.
- An employer is required under law to complete a criminal background check for that position.
Importantly, the act does not prohibit employers from obtaining a criminal background check of an applicant or inquiring into an applicant’s criminal history later in the hiring process. Compared with many other “ban the box” laws, this law is leaner and imposes fewer restrictions on employers.
Nonetheless, the act imposes penalties for precluding applicants with criminal histories in advertisements and initial application materials. The Colorado Division of Labor may investigate complaints filed by an applicant within 12 months of the alleged violation. The act also creates a penalty scheme with increasing fines for successive violations, from a warning to fines of up to $2,500. Notably, the act does not create a private right of action for an aggrieved applicant.
The act goes into effect on Sept. 1, 2019, for employers with 11 or more employees, and Sept. 1, 2021, for all other employers. Employers of any size can prepare now for this change by reviewing and revising, as needed, employment advertisements and initial applications to comply with the act.
H.B. 19-1025, 72d Gen. Assemb., Reg. Sess. (Colo. 2019), Colo. Rev. Stat § 8-2-130 (2019).
Criminal Offenses for Failure to Pay Wages
The Colorado Legislature took a significant step to combat wage theft by passing House Bill 19-1267. Under the new law, wage theft has been criminalized.
Wage theft violations are now subject to the penalties found in Colorado’s criminal theft statute. This means that employers who are convicted of wage theft face misdemeanor or felony charges, as well as significantly increased criminal fines from $50 to $1 million, depending on the severity of the circumstance and the value of the unpaid wages.
More specifically, the law imposes this criminal penalty for (1) an employer’s willful refusal to pay wages and compensation, or (2) an employer’s false denial of an amount or validity of a wage claim with either the intent to underpay or the intent to “annoy, harass, oppress, hinder, coerce, delay, or defraud a person to whom the indebtedness is due.” The new law removes the previous exemption from criminal penalties for an employer who is unable to pay wages due to Chapter 7 bankruptcy. Also, the act imposes criminal penalties for an employer’s willful intent to pay an employee less than minimum wage.
This new law takes effect on Jan. 1, 2020, but employers should review compensation policies and practices now to avoid exposure to criminal penalties.
H.B. 12-1267, 72d Gen. Assemb., Reg. Sess. (Colo. 2019), Colo. Rev. Stat §§ 8-4-101(5)–(6), (8.5), 8-4-114(2), 8-6-116(1)–(2) (2019).
Equal Pay for Equal Work Act
The Equal Pay for Equal Work Act tightens protections for pay equity and results in new rules that employers should immediately consider. The BakerHostetler team recently analyzed this new act on the Employment Law Spotlight. For a more detailed summary of the act, please click here.*
* Many thanks to Kate Googins, Denver office summer associate, for her assistance with drafting this post.