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Colorado Employment Law Alert – Equal Pay for Equal Work Act, Effective January 1, 2021

In March of this year, COVID-19 took most of us by complete surprise. A lot of us have spent many weeks working tirelessly to confront the reality of rapidly changing state and local guidelines, furloughs, layoffs, dire financial circumstances, and more. All of this is true and might continue to be true for the foreseeable future.

But in the midst of the COVID chaos, we at HRx are trying to assist our partners and communities not only with the impacts of the pandemic but also with the future of employment law in the state of Colorado. It has been easy to forget during this time that the Colorado Equal Pay for Equal Work Act (SB19-085), a landmark piece of state legislation dealing with employment law, takes effect on January 1, 2021. This legislation may fundamentally change how many organizations approach hiring, promotions, record-keeping, and more, so we want to give you the “quick and dirty” of the law so you can begin to prepare.

Why did the Colorado General Assembly pass the Equal Pay for Equal Work Act?

The bill sponsors write in the legislative declaration of SB19-085 that even though state and federal law already prohibit pay discrimination based on sex, large pay disparities continue to exist. According to reports by the Institute for Women’s Policy Research and The Women’s Foundation of Colorado, women in Colorado earn 86 cents on the dollar for every dollar earned by their male counterparts, with black women trailing behind at 63.1 cents and Latina women at 53.5 cents.

How does the Equal Pay for Equal Work Act claim to remedy pay discrimination?

The bill prohibits all employers in the state of Colorado, both public and private, from discriminating between employees on the basis of sex (or on the basis of sex combined with another protected category as defined by state law) by paying employees of one sex less than rates paid to employees of another sex for performing substantially similar work.

What are some things the Act REQUIRES Employers to do or not do?

In addition to prohibiting certain behaviors such as requesting wage history in a job search, discriminating against employees for reporting violations or seeking enforcement of the act, and keeping employees from sharing their wage rates, the Act mandates certain actions from employers. The Employer is also required to maintain records of job descriptions and wage rate history for all employees for the duration of their employment and two years following the end of their employment

What are the consequences of noncompliance?

If one of your employees believes they have been discriminated against on the basis of sex in their wage rate, they may initiate civil action against you for lost wages for up to three years. If you violate the Act by not retaining the required documentation, a jury may be instructed to presume that the missing documentation contains information favorable to the employee.

Moreover, the Director of the Division of Labor Standards and Statistics may take enforcement actions against employers that fail to abide by transparency requirements in pay and employment opportunities. Fines range from $500 to $10,000 per violation.

All this is to say that this bill means business, and we’re here to help you avoid costly noncompliance errors.

How can HRx help?

The team at HRx are more than excited and equipped to help you comply with the requirements of this act by:

  1. Restructuring and reimplementing your organization’s hiring and promotion processes to ensure compliance with the Act;

  2. Auditing or building appropriate wage rates for new job openings that your organization must now post alongside the position announcement;

  3. Conducting record audits to remedy unintentional wage discrepancies and to ensure compliance with the Act;

  4. Answering your specific questions regarding how SB19-085 could affect the operations of your organization.

If you’re worried about compliance with the Equal Pay for Equal Work Act, we hear you. We understand that this legislation will impact employers in significant ways, and we want to help you protect your business and join the fight against wage discrimination. Set up a consultation today to learn more about how we can assist your organization in the coming months!

COVID-19 may not be going away any time soon, but neither is SB19-085. As always, it’s our pleasure to help you prepare.

Post and research credited to: Megan Valliere, CSU Jr. Minor in Legal Studies and English

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