New Changes in Effect with Colorado’s Wage Protection Rules, Starting January 1, 2023

Ashley Graves, Law Clerk

            Starting January 1, 2023, certain modifications to Colorado’s wage protection rules (7 C.C.R. 1103-7 et seq.) concerning the Healthy Family and Workplaces Act (“HFWA”), attorney fee awards, and the issuance of liens and levies upon non-compliant employers in wage disputes will go into effect.[1] 

Of note, while not a substantive change, the new rules simplify the language regarding the pay rate that must be used when providing paid sick leave under the HFWA.  The old version of the rules cross-referenced “regular rate of pay” calculations in the current COMPS Order provisions,[2] while excluding certain forms of income that are ordinarily included in the “regular rate of pay” (notably non-discretionary bonuses), to describe the pay rate used for HFWA leave.  The revised version of the rule simply states that pay for HFWA leave is based on the employee’s pay over the 30 calendar days before taking leave, and includes set hourly or salary rates, shift differentials, tip credits, and commissions; but does not include overtime, bonuses (discretionary or non-discretionary), or holiday pay. 

Additionally, the new rules provide a procedure for employees or other complainants who prevail in administrative wage violation complaints to recover attorney fees and costs, when otherwise awardable under the law.    Employees or other applicable claimants/complainants can apply for an award of attorney fees or costs within 21 days of the Wage and Hour Division’s (“Division’s”) decision.  The new rules also provide for employers or other interested parties to respond to the fee request, and any attorney fee awards are appealable. 

            The last notable change concerns administrative liens and levies under Rule 8.  The Division may issue a notice of administrative lien and levy against employers that fail to pay wages, fines, or penalties that are due pursuant to an order awarding such amounts that is not the subject of any pending appeal.   Such liens can be crippling, as the rules contemplate the liens requiring an employer’s financial institutions to freeze 100% of the assets on deposit as of the date of the notice of lien and levy.  The employer has twenty-one (21) days after the notice to file an opposition to the notice of lien or levy.

 Key Takeaways                       

            The labor and employment landscape in Colorado is continually in flux, and the start of a new year is set to bring more changes that employers should be aware of when moving forward into 2023.  As always, Campbell Litigation is available to assist with any questions or concerns regarding the above rule changes or other issues pertaining to Colorado’s wage and hour laws.   

[1]https://cdle.colorado.gov/sites/cdle/files/7%20CCR%201103-7%20Wage%20Protection%20Rules%20-%20%282023%20Redlined%29.pdf

[2]7 C.C.R. 1103-1 et seq.