Colorado Overtime and Labor LawsColorado Overtime and Labor Laws
Minimum Wage Regulations
In November, 2016, Colorado passed Amendment 70 raising the Colorado minimum wage to $9.30 in 2017. Tipped employees must be paid a minimum wage of $6.28. As the Colorado state minimum wage rate is higher than the federal minimum wage rate of $7.25, employees must be paid the higher state rate.
Colorado minimum wage will increase to $10.20 in 2018, $11.10 in 2019, and $12.00 in 2020. Tipped employees’ minimum wage will increase to $7.18 in 2018, $8.08 in 2019, and $8.98 in 2020. Cost of living adjustments will be made after 2020.
Prior minimum wage rates in Colorado were $8.31 per hour for 2016, $8.23 per hour for 2015, and $8.00 per hour for 2014.
An employer of a tipped employee may deduct a tip credit from the minimum wage of no more than $3.02 per hour. An employee’s tips plus the cash wage must equal at least the current state minimum wage. This means that if an employee only averages $2 per hour in tips, the employer must pay a cash wage of $6.31 per hour (using 2016 minimum wage). An employer may not claim tip credits toward the minimum wage if the employer requires its employees to share tips with employees who do not regularly receive tips (cooks, managers, etc.) or if the employer deducts credit card processing fees from the employees’ tips.Overtime Pay Regulations
Colorado state overtime laws are designed to protect employees from being taken advantage of by their employer. Colorado’s overtime wage laws are more favorable to workers than federal law. Under Colorado state wage law, employers are required to pay each non-exempt employee an overtime wage of one-and-a-half times the employees regular hourly rate for all hours worked in excess of:
- 40 hours in one workweek
- 12 hours in one workday
- 12 consecutive hours, regardless of whether the work period overlaps into a second day
Certain individuals fall outside the definition of an “employee” under Colorado’s labor laws, meaning that they are not entitled to a minimum wage or overtime pay. While employers will commonly claim that workers are independent contractors (and not entitled to overtime pay), to be properly classified as such, a worker must be primarily free from control and direction in the performance of duties and customarily engaged in an independent trade, occupation, profession or business.In-home Caregivers & Personal Care Attendants
In-home care workers employed in Colorado by/through a home healthcare company, may be entitled to overtime pay. A recent ruling from a federal judge found that “companion” employees must be paid overtime under Colorado state law, if they are employed by a third-party agency. Caregivers employed directly by individuals (not through a staffing or home health agency), are, however, exempt from the overtime pay requirements of Colorado’s labor laws.Exemptions
Certain workers are exempt from the Colorado wage and hour laws, meaning the employer is not required to pay minimum wage or overtime. Most of the exemptions state the employer must be salaried, although the state laws do not set a minimum amount for a salary (federal law does – $455*/week) or when salary payments must be made. Each exemption has its own set of requirements. If all requirements are met, the following professions are exempt from the minimum wage and overtime pay requirements:
- Administrative employees
- Professional employees
- Computer professionals earning at least $27.63 per hour
- Outside sales people who spend at least 80 percent of the workweek engaged in activities directly related to their own outside sales The following are exempt only from the overtime pay requirements:
- Employees of farm implement retail dealers
- Salespersons employed by trailer, aircraft, and boat retail dealers
- Commission salespeople receiving at least 75 percent of their annual dollar volume from commission
- Ski industry employees (exempt only from the 40-hour workweek overtime requirement)
*New rules increasing this salary amount were set to go into effect on 12/1/16 but have been delayed by a lawsuit brought by several states. Please see this page for the latest updates.Holidays / Vacation
In Colorado, employers may require their employees to work on holidays or weekends without receiving additional pay, unlike government workers. Employers are not required to provide vacation, holiday or other pay for time that is not worked.Breaks / Meals / Lodging
Colorado law requires an employer to give its employee a paid, uninterrupted 30-minute break for every five hours worked. Additionally, each employee is entitled to a 10-minute break for every four hours worked. An employer who furnishes its employee with meals or lodging may include the cost or fair market value of the meal or lodging as part of the minimum wage. However, value of lodging applied toward the minimum wage may not exceed $25 per week.Pay Periods
Under Colorado wage law, an employer must pay its employees at least once per calendar month. Paydays must be regular and occur within 10 days of the end of the close of the pay period unless a separate agreement exists. Reporting Time Pay Neither Colorado nor the Federal law requires an employee to be paid if he or she reports to work expecting to work for a certain number of hours but does not get to work their full schedule. Deductions According to the FLSA, deductions for items including uniforms, shortages, damaged goods, or trade tools cannot decrease the employee’s hourly wage below the minimum rate.Statute of Limitations
According to Colorado state overtime laws and wage rules, suits for unpaid wages must be brought within two years (three years if the employer’s violation is willful) or else the employee is barred by the statute of limitations.State Law Remedies / Penalties
Any employee who is not paid appropriate wages may initiate a civil action against his employer for owed wages. The employee may also recover a penalty from the employer equal to the greater of 125 percent of the amount owed or 10 days of compensation.Retaliation
If an employer retaliates against an employee for exercising their rights under the minimum wage and overtime laws, they may face criminal penalties, including a fine and jail time. Additionally, the Wage Transparency Act specifically prohibits Colorado employers from forcing an employee to give up the right to disclose his wage as a condition of employment, and employers may not retaliate against an employee in any way for disclosing his or her wage.Questions? Contact us today to receive more information, as well as a review your specific circumstances. Submit your information through our case-evaluation-form , send an email or call Michael Lore at the Lore Law Firm.