Colorado Expands Permissible Payroll Deductions and Prohibits Deductions for PPE - HR ALERTS

Colorado Expands Permissible Payroll Deductions and Prohibits Deductions for PPE

Effective Date: August 12, 2026

Colorado has updated its wage deduction law by expanding the types of expenses employers may recover through payroll deductions while also prohibiting deductions for required personal protective equipment (PPE).

What Changed?

Beginning August 12, 2026:

• Employers may make payroll deductions for loans, wage advances, goods or services, equipment or property, and any other item that primarily benefits the employee, provided there is an enforceable written agreement.

• Employers may not deduct the cost of required personal protective equipment (PPE) from an employee's wages, even if the employee voluntarily signs a written authorization permitting the deduction.

Why This Matters

The law provides employers with greater flexibility to recover certain employee-benefiting expenses through authorized payroll deductions while making it clear that the cost of required PPE must be borne by the employer.

Recommended Next Steps

• Review payroll deduction agreements and authorization forms.

• Evaluate whether existing deductions comply with the amended law.

• Remove any deductions for required PPE.

Reference: Colorado S.B. 160 

---

Get day-to-day updates on Colorado Expands Permissible Payroll Deductions and Prohibits Deductions for PPE visit the Vida HR Knowledge Center (Vida HR Clients Exclusive).