As businesses around Colorado ring in the New Year, employers should be aware that the latest Colorado Overtime and Minimum Pay Standards Order (“COMPS Order”) #38, Wage Protection Rules, and 2022 PAY CALC went into effect on January 1, 2022. There are several key points for employers to be aware of:
- Under the new Wage Protection Rules “vacation pay” means “pay for leave, regardless of its label, that is usable at the employee’s discretion.” Consistent with the Colorado Supreme Court’s decision in Nieto v. Clark’s Market, Inc., this means that paid time off that has been accrued cannot be forfeited—regardless what the employer calls the paid leave.
- The Wage Protection Rules provide further clarification regarding how paid sick leave time under the Heathy Families and Workplaces Act must be paid. Paid sick leave must be paid at the same rate of pay and with the same benefits as non-sick leave pay. This does not include overtime, bonuses, or holiday pay. Sick leave pay must be paid on the same schedule as regular wages.
- The minimum pay levels have been moved out of the COMPS Order and into a new document called the 2022 PAY CALC. The stated intention is to try to reduce the need to revise the entire COMPS Order each year. It remains to be seen whether this will reduce or eliminate the need for annual changes to the COMPS Order.
- Colorado now has an exemption to the wage and overtime requirements for highly compensated employees (HCE). The purpose of this exemption is to aid employers who must often navigate the vagaries of the executive, administrative, and professional exemptions. While this exemption is new to Colorado, it is similar to the exemption for HCE’s under federal law. Colorado’s version is somewhat more restrictive than its federal counter-part. In short, the new exemption is for white collar employees whose primary duty is office or non-manual work (as opposed to the federal requirement that such employees’ primary duties merely include office or non-manual work) and who are paid at least $101,250 annually in 2022. This annual amount will increase in subsequent years.
Colorado employers should work with qualified legal counsel to navigate these and other important updates to the wage and hour laws. Contact Katie Pratt at Wells Anderson & Race LLC with questions.