In Colorado, salaried employees are individuals who receive a predetermined fixed amount of compensation at regular intervals, such as weekly or less frequently.
There are specific laws and regulations that govern the rights and obligations of salaried employees and their employers in Colorado.
This article aims to provide an overview of the applicable laws and regulations concerning salaried employees in Colorado. It will cover topics such as pay, break and leave entitlements, as well as the distinction between exempt and non-exempt employees.
This article covers:
- Payment of Wages for Salaried Employees in Colorado
- Salary Deductions for Colorado Salaried Employees
- Salaried Employees Eligibility for Overtime for Colorado
- Pay for Working Overtime for Colorado Salaried Employees
- Exemptions for Colorado Salaried Employees
- Equal Pay For Equal Work Act on Salaried Employees in Colorado
- Break Entitlements for Salaried Employees in Colorado
- Leave Entitlements for Salaried Employees in Colorado
- Termination of Employment for Salaried Employees in Colorado
Payment of Wages for Salaried Employees in Colorado
Under Colorado law, specifically the Colorado Wage Act, employers in Colorado have an obligation to promptly and accurately compensate their employees for the wages they have earned.
It is a requirement for all employers to display a notice that indicates the regular paydays as well as the specific time and location of wage payment. Additionally, any modifications to the paydays or the time and place of payment must also be communicated to employees as they occur.
Employers and employees have the option to agree upon the frequency of wage and salary payments.
In the absence of such an agreement, Colorado wage law specifies that wages or compensation must be paid within regular pay periods, which cannot exceed one calendar month or thirty days, whichever is longer.
Regular paydays should not be later than ten days after the end of each pay period. It is important to note that these requirements do not apply to compensation payments related to profit-sharing plans, pension plans, or similar deferred compensation programs.
The Division of Labor Standards and Statistics maintains a policy that any changes to the pay period schedule or payday date must adhere to the aforementioned timeframes.
Employers cannot make changes that violate the one-month or thirty-day pay period requirement for regular pay periods, nor can they violate the ten-day payday requirement unless both the employer and the employee mutually agree to an alternative payment period.
Frequently, employers use payroll hours tracking to oversee payment periods and authorization processes, thereby preventing situations where wages remain unpaid and ensuring compliance with legal requirements.
Salary Deductions for Colorado Salaried Employees
There are instances where employers in Colorado may deduct employee wages for a number of reasons. Such deductions can be legally acceptable and others may be in violation of the law.
Permissible deductions from employee wages include those required by law (such as taxes and garnishments), deductions agreed upon in writing (such as loans or equipment costs), deductions to cover theft-related shortages under certain criteria, authorized deductions that can be revoked (such as insurance or savings plans), and deductions for union dues or failure to pay or return money or property owed to the employer.
On the other hand, impermissible deductions include those for property damage or depreciation, where employers cannot deduct costs from an employee’s wages, and fines for employee behavior or actions, where employers cannot deduct from wages based on behavior or performance, such as deducting meal costs from a waiter’s wages due to non-payment by a customer.
Salaried Employees Eligibility for Overtime for Colorado
Despite the general misconception, state and federal laws regarding wage and hour regulations mandate that nearly all employees, including salaried workers, must receive overtime pay for any hours worked beyond 12 per day or 40 per week.
However, there are exceptions to this general rule for specific salaried employee categories within certain salary ranges.
Learn more in detail about Colorado Overtime Laws.
Pay for Working Overtime for Colorado Salaried Employees
For salaried employees eligible for overtime, determining the regular rate for calculating overtime pay involves dividing their salary by the number of hours it is intended to cover.
If the salary covers fewer than 40 hours in a workweek, the regular rate is added for each additional hour worked until reaching 40 hours. Overtime pay at time-and-a-half is only applicable for hours worked beyond 40 in a workweek.
On the other hand, if the salary already covers 40 hours weekly, time-and-a-half is paid for any additional hours worked.
While these calculations might appear complex, contemporary employers can simplify and streamline them by using a timesheet app, monitoring time and attendance, or even employing overtime compliance software.
Exemptions for Colorado Salaried Employees
In Colorado, certain categories of salaried employees are exempt from the minimum wage, overtime, and meal and rest break requirements if they meet specific salary thresholds.
Executive or supervisor employees, and administrative employees, are exempt if they earn a salary that exceeds the equivalent of the minimum wage, currently set at $961.54 per week or $50,000 per year.
Similarly, professional employees, excluding doctors, lawyers, and teachers, are also exempt if they earn a salary that exceeds this same requirement.
Further, highly technical computer employees are exempt if they earn at least $961.54 per week or $50,000 per year.
It’s worth noting that such salary thresholds are expected to increase on January 1, 2024 to $1,057.69 per week or $55,000 per year. Further increase is also expected on January 1, 2025 where the 2024 rate will be adjusted by the same CPI as the Colorado Minimum Wage.
Impact of Colorado’s Equal Pay For Equal Work Act on Salaried Employees
In 2019, Colorado implemented the pay transparency law, also referred to as the Equal Pay For Equal Work Act (EPEWA) which took effect on January 1, 2021.
This law is designed to enhance transparency and equity in hiring practices and address wage gaps influenced by gender or other protected attributes.
Colorado’s pay transparency law encompasses key elements including equal pay for equal work, pay scale transparency, salary history ban, freedom to discuss wages without retaliation, and recordkeeping obligations.
Under the equal pay provision, employers are prohibited from paying employees of different sexes less for substantially similar work. However, certain wage differentials are allowed based on factors like seniority, merit, production metrics, location, education, experience, and necessary travel.
Regarding pay scale transparency, job postings must include the compensation range, bonuses, benefits, and other employment benefits offered. Employers must also inform Colorado employees about promotional opportunities and associated pay ranges.
The law prohibits employers from requesting or relying on salary history when determining wages. Prospective employees cannot be coerced into disclosing their salary history, and employers cannot discriminate or retaliate against individuals who choose not to disclose.
Employees are granted the freedom to discuss their wages without fear of retaliation. Employers are forbidden from discharging, disciplining, or discriminating against employees who inquire about, disclose, or discuss their wage rates.
Lastly, employers have recordkeeping obligations, including maintaining job descriptions and wage rate history for each employee during and for two years after their employment.
Break Entitlements for Salaried Employees in Colorado
Colorado employees have the right to an uninterrupted and duty-free meal break of at least 30 minutes if their shift exceeds five consecutive hours of work.
Ideally, this meal period should be scheduled at least one hour after the start and one hour before the end of the shift.
During this time, employees should be relieved of all duties and allowed to engage in personal activities that are unrelated to work.
In cases where it is not feasible to provide an uninterrupted meal break due to the nature of the business or other circumstances, employees may be allowed to consume an on-duty meal while performing their duties. They should be permitted to fully enjoy their chosen meal and be compensated for the on-duty meal period without any loss of time or pay.
The reasonable cost or fair market value of meals provided by the employer can be counted towards meeting the minimum hourly wage requirement. However, the employer cannot include any profits in the calculation of the reasonable cost or fair market value of the provided meals. Employees must have the option to accept or decline a meal voluntarily, without any coercion.
Employers are required to grant a compensated 10-minute rest period for every four hours of work, or major fractions thereof. The number of required rest periods depends on the total duration of the work shift.
Ideally, these rest periods should be scheduled in the middle of each four-hour work period. It is not necessary for employees to leave the workplace during their rest periods.
Leave Entitlements for Salaried Employees in Colorado
In Colorado, salaried employees are entitled to various mandated leaves. Under the Healthy Families and Workplaces Act, employees accrue sick leave at a rate of one hour for every 30 hours worked, up to a maximum of 48 hours per year. This leave can be used for illness, injury, and caring for family members, among other reasons.
Additionally, employers must provide public health emergency leave related to COVID-19, covering situations such as illness, quarantine, and caring for family members, with this leave being paid at the regular rate.
Jury duty leave is also required, allowing employees to take time off without risking their job security, and they should receive payment at their normal compensation rates, up to $50 per day. Employees are granted a two-hour leave for voting, unless specific circumstances apply.
Military leave of up to 15 days is provided to those serving in the National Guard or military reserves. Qualified volunteers can request up to 15 days of emergency response leave per year.
Lastly, victims of domestic violence or sexual assault are entitled to take up to three days off per year for legal and medical purposes, which must be offered by employers with 50 or more employees.
It’s important to highlight that salaried employees receive a consistent salary irrespective of their work hours, which spares them from monitoring hours and lets them concentrate on tasks within reasonable timeframes. Nevertheless, keeping records, timesheets, and hour reports can prove useful in situations such as unplanned absences, vacations, holidays, and sick days.
Learn more in detail about Colorado Leave Laws
Termination of Employment for Salaried Employees in Colorado
In Colorado, as in many other states, the principle of “employment-at-will” is observed.
This principle allows employers to terminate an employee’s employment without providing notice or justification, and it also permits employees to resign from their position without prior notice.
Learn more about Colorado Labor Laws through our detailed guide.
Important Cautionary Note
When making this guide we have tried to make it accurate but we do not give any guarantee that the information provided is correct or up-to-date. We therefore strongly advise you seek advice from qualified professionals before acting on any information provided in this guide. We do not accept any liability for any damages or risks incurred for use of this guide.
