Colorado - Equal Pay for Equal Work Act Amendments
Colorado has amended the Equal Pay for Equal Work Act (EPEWA) to include additional employer job posting requirements which will go into effect on January 1, 2024. Senate Bill 23-105, which amends the EPEWA, was signed into law on June 5, 2023 by Governor Polis and can be reviewed here.
As you may recall, the EPEWA went into effect on January 1, 2021, and required all employers to “make reasonable efforts announce, post, or otherwise make known all opportunities for promotion to all employees” prior to making an employment decision. The intention of the law was to prohibit sex-based wage discrimination, to increase transparency surrounding internal promotional opportunities and job openings for employees in Colorado, and require employers to pay employees the same compensation for performing the same job duties, while taking into account experience, credentials, tenure, etc.
The amended EPEWA as of January 1, 2024, provides clarification for which types of jobs employers are obligated to provide advance notice to employees, adds to the information employers must include in notices, and includes a new post-selection requirement for employers.
Under the amended law, all Colorado employers (and those employers with employees in the state of Colorado) must continue to notify employees of any and all job opportunities and promotional opportunities.
The amended law defines provides the following definitions:
Job opportunities are a current or anticipated vacancy for which the employer is considering a candidate or candidates or interviewing a candidate or candidates or that the employer externally posts.
Promotional opportunities are a current or anticipated vacancy that could be considered a promotion for one or more employees in terms of compensation, benefits, full-time or part-time status, duties, or access to further advancement.
The law further delineates promotional opportunities to specifically EXCLUDE career development and/or career progression:
Career development is a change to an employee’s terms of compensation, benefits, full- or part-time status, duties, or access to further advancement in order to update the employee’s job title or compensate the employee to reflect work performed or contributions already made by the employee.
Career progression is a regular or automatic movement from one position to another based on time in a specific role or other objective metrics.
This means that employers will no longer need to post career advancement or career progression promotions for internal employees if the promotion is on a fixed schedule or put in writing at time of hire, e.g., an employee automatically moves from Junior Accountant to Senior Accountant after two (2) years in the Junior Accountant role; or an employee is offered the Junior Accountant role at time of hire and their offer letter states they will be considered for promotion to a Senior Accountant position after a period of two (2) years in the role. Additionally, employers would not need to post a promotional opportunity for increasing an employee’s pay or changing their status to account for what they are currently doing. An example might be an employee who absorbed responsibilities due to another employee’s separation of employment and the employer is changing the individual’s compensation for absorbing the additional duties.
The amended law does not change the 2021 requirements for employers to include the following information in job or promotional opportunity notices to employees. These continue to include:
Hourly or salary pay amount or range;
Any other compensation (bonus schedule, stipend, commission, etc.);
A general description of benefits offered.
There is an additional requirement, which should be of note for employers, indicating for any job or promotional opportunity notice the employer must include the “earliest date the application window will close.” In other words, on and after January 1, 2024, employers will be required to state the date(s) job applications will be accepted and the deadline for applications.
Additionally, within thirty (30) days of making a candidate selection for a job or promotional opportunity, employers will be required to, at minimum, notify employees “whom the employer intends the selected candidate to work with regularly” of the following details:
The name of the selected candidate.
The job title:
If an existing employee – provide the former job title and the new job title.
If a new employee – provide the title of the role the candidate was selected to fill.
Information about how employees can apply for similar roles with the employer in the future.
For opportunities with career progression/career paths, although not required to post the career development or progression, employers will be required to provide information to employees about the requirements for the role, compensation, benefits, full- or part-time status, responsibilities/duties of the role, and additional advancement opportunities.
Employers must also be sure not to provide any information about a candidate that would violate their legal and/or privacy rights or that would put them in a position of risk.
The existing EPEWA provides an avenue for employees to make complaints about non-compliant employers to the Colorado Department of Labor and Employment. Under the new law, effective January 1, 2024, damages could include backpay for an employee or applicant for up to a period of six (6) years, which is an increase from the previous period of three (3) years.
An interesting, and sure to be welcome change, comes for employers whose operations are physically outside of the state of Colorado, and have fewer than 15 employees in the state that all work remotely. These employers no longer have to notify all employees of job and promotional opportunities. Instead, these employers will only be required to notify employees about remote job opportunities through July 1, 2029, instead of providing notice about all company-wide job and promotional opportunities. It is unclear if this exemption will continue after July 1, 2029, or if there will be additional guidance at that time.
The EPEWA will continue to include a provision for employers looking to replace a current employee who is not aware of their upcoming separation from employment. In these circumstances, an employer is not obligated to post the job or promotional opportunity to existing employees until the existing employee’s termination takes effect. Once the separation is completed, employers must follow the EPEWA requirements for posting the job and include all required elements in the posting.
Colorado employers must also continue to keep required records of job descriptions and compensation for all employees for the duration of employment, and an additional two (2) years following separation of employment.
Effective January 1, 2024, employers will no longer be required to notify employees of career progression (regular or automatic) promotions that an employee may achieve without competition.
Employers will be required to provide eligible employees with details about how an employee could be eligible for career progression and development opportunities and include compensation, benefits, full- or part-time status, job duties, and future advancement of the role.
After filling a position, within 30 days, and employer will be required to notify employees that will regularly work with a new employee (or existing employee) of the selected candidate’s name, title (and former title, if applicable), and how to express interest in similar job or promotional opportunities.
Non-Colorado based employers will only need to notify employees of remote work opportunities in the state of Colorado beginning January 1, 2024, through July 1, 2029.
Colorado employers will need to provide an application window and applicable close date for all posted job and promotional opportunities.
Employer penalties for non-compliance will be increasing from three (3) years of damages to up to six (6) years of damages for impacted employees/applicants.
CDLE is anticipated to provide additional information about the requirements in fall 2023, but no later than July 1, 2024, which is after the effective date of the law. In the meantime, Vida HR recommends that employers prepare for compliance with the new requirements under the law in advance of the January 1, 2024, effective date.
Vida HR can provide HR guidance and consultation for employers seeking more information on how to comply. Contact us today!