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Nobody ever said running a business was a walk in the park. As an employer, you have a lot of balls in the air, and compliance is just one of them. One really, really important one that, if dropped, could cost you a whole lot of money.
In addition to federal regulations, each state has their own share of employment laws that business owners need to be aware of. Here, we’re highlighting some of these key state-specific requirements and laws, and offering guidance to help you keep up.
Bear in mind, this list is not comprehensive, and there may be local or industry-specific employment requirements that your business needs to comply with. It’s best to consult with counsel to ensure compliance with all applicable laws, as Justworks does not provide legal advice.
Payroll Tax Accounts
Because Justworks reports state unemployment taxes on your behalf, you’ll need to provide us with some key pieces of information prior to joining our platform. Here are the steps to do that.
Colorado - State Unemployment Insurance
Pay Requirements
Colorado has minimum wage and overtime requirements in excess of the federal requirements. Colorado also has additional pay and other requirements to be met in order for employees to be considered exempt from minimum wage and overtime laws.
The localities in Colorado, listed below, have a higher minimum wage than at the state level. Where both laws apply to an employee based on worksite, the aspects of each law that most favor the employee should be followed. Minimum wages in these localities are always changing, and this list is always growing. The very best way to ensure compliance with all applicable laws is to consult with legal counsel.
Colorado law requires employers to pay employees at the overtime rate, unless otherwise exempt, when certain hours-worked thresholds are reached. Overtime rate is defined here as one and a half times (1.5x) the employee’s regular rate of pay. An employer is required to pay overtime in Colorado when an employee works:
- More than 40 hours in a workweek; or
- More than 12 hours in a workday; or
- More than 12 consecutive hours, regardless of workday.
Employers must calculate overtime for (i) working more than 12 hours in a workday or (ii) working more than 12 consecutive hours (regardless of workday) and pay overtime wages based on whichever approach provides a greater benefit to the employee, and then add any additional hours that were not counted in that calculation but resulted in weekly overtime.
ThinkHR: Colorado Minimum Wage and Overtime*
Colorado Department of Labor and Employment (DLE): Minimum Wage
Colorado DLE: Overtime
Colorado DLE: Exemptions
Paid Sick Leave
Under Colorado’s Healthy Families and Workplaces Act (HFWA), most Colorado employers are required to offer up to 48 hours of paid sick and safe leave to Colorado employees. Covered employers with 16 or more employees must begin offering paid sick and safe leave beginning on January 1, 2021, while covered employers with 15 or fewer employees have an additional year to comply. Covered employers will also have to provide additional leave during public health emergencies under the HFWA.
Termination
Colorado employers should familiarize themselves with specific compliance issues and certain key considerations for terminating employees.
Terminating an Employee - Colorado
How to file a claim for unemployment insurance benefits
Colorado law requires that employees be paid their owed wages at the time of termination if termination is involuntary. If an employee resigns, then the final pay can be paid out with the next regular payroll, via direct deposit or otherwise.
Employers are also required to pay out any accrued, unused vacation. All vested vacation must be paid to the employee as wages, at the final rate of pay.
Department of Labor Standards: Colorado law about employment termination
Notes
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Disclaimer
This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, legal or tax advice. If you have any legal or tax questions regarding this content or related issues, then you should consult with your professional legal or tax advisor.