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08 Dec

December 2021: Colorado Mid-Month Updates

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Colorado Department of Labor and Employment Releases Two Rules Affecting Pay Calculation and Amends COMPS 37

Update Applicable to:
All employers in Colorado.

What happened?
On November 10, 2021, the Colorado Department of Labor and Employment (CDLE) published two final rules called the PAY CALC Order and Colorado Overtime and Minimum Pay Standards Order #38 (COMPS 38), which amends COMPS 37, making adjustments to wage amounts and salary thresholds, which affects agricultural workers.

What are the details?
The PAY CALC Order is a new set of rules that publishes pay and income levels for minimum wage and various exemptions, including the new exemption for highly compensated employees, in a straightforward table.

COMPS 38 establishes two options for determining the regular rate of pay for employees working multiple jobs at different hourly rates for the same employer:

  • Weighted average method: To determine the employee’s regular rate for the workweek, add the employee’s earnings during that workweek and divide it by the number of hours worked.
  • Rate-in-effect method: The employee’s regular rate can be based on the rate in effect when the work is performed if the employer and employee agree that it will be calculated under this method.


Employers who want to use the “rate-in-effect” method must have a written agreement with the employee stating that this method will apply in advance of performing the work. Otherwise, the weighted average method will apply.

COMPS 38 also showcases a continuing trend in the state to narrow or eliminate certain job- and employee-specific exemptions. In response to the passage of a recent agricultural law, agricultural workers now must be paid the state minimum wage ($12.56 in 2022), but they may remain exempt from overtime requirements if certain pay and break requirements are met.

Agricultural range workers remain exempt from minimum wage requirements if they are paid the minimum salary in PAY CALC of $515 per week. Finally, COMPS 38 eliminates the option to pay employees certified by the CDLE to be less efficient in the performance of their job duties due to a disability 15 percent less than the applicable minimum wages.

The CDLE will issue a COMPS 38 poster that must be prominently displayed in the workplace or provided to employees if a physical posting is impractical. Updated posters may be found here.

These two new rules will go into effect on January 1, 2022.

For more information, please see the links below:

PAY CALC Order

COMPS Order #38

COMPS Poster

Agricultural Law

Article 1Article 2

What do employers need to do?
Employers should review the links provided above, prepare to make adjustments to their payroll system, and prepare to secure a location for the COMPS poster to be displayed or provided to their employees.



Colorado PSL Amendments Coming in 2022

Update Applicable to:
All employers in Colorado.

What happened?
Starting January 1, 2022, new amendments will be in effect for Paid Sick Leave (PSL) expanding to ALL employers in Colorado regardless of size per Statute § 8-13.3-403 in Senate Bill 20-205 (SB 20-205), the “Health Families and Workplaces Act” (HFWA).

What are the details?
On January 1, 2021, employers with 16 or more employees were required to provide all employees PSL accrued at one hour of PSL for every 40 hours worked, up to a maximum of 48 hours per year.

Effective January 1, 2022, this rule will be changed to include all employers in the state, regardless of size.

An employee begins accruing PSL when the employment begins, may use PSL as it is accrued, and may carry forward and use in subsequent calendar years up to 48 hours of PSL that is not used in the year in which it is accrued. An employer is not required to allow the employee to use more than 48 hours of PSL in a year.

Employees may use accrued PSL to be absent from work for the following purposes:

  • Has a mental or physical illness, injury, or health condition; needs a medical diagnosis, care, or treatment related to such illness, injury, or condition; or needs to obtain preventive medical care;
  •  To care for a family member who has a mental or physical illness, injury, or health condition; needs a medical diagnosis, care, or treatment related to such illness, injury, or condition; or needs to obtain preventive medical care;
  • The employee or family member has been the victim of domestic abuse, sexual assault, or harassment and needs to be absent from work for purposes related to such crime; or
  • A public official has ordered the closure of the school or place of care of the employee’s child or of the employee’s place of business due to a public health emergency, necessitating the employee’s absence from work.

The act prohibits an employer from retaliating against an employee who uses their PSL or otherwise exercises their rights under the act. Employers are required to notify employees of their rights under the act by providing them with written notice of their rights and displaying a poster, developed by the Colorado Division of Labor Standards and Statistics (DLSS) in the Colorado Department of Labor and Employment (CDLE), detailing employees’ rights under the act.

The act also treats an employee’s information about themselves or a family member’s health condition or domestic abuse, sexual assault, or harassment case as confidential and prohibits an employer from disclosing or requiring the employee to disclose such information as a condition of using their PSL.

For more information, please see the links below:

Senate Bill 20-205

Statute § 8-13.3-403

Colorado PSL Poster (All languages)

Federal Article

What do employers need to do?
Employers should review the links above and prepare to make adjustments to their PSL policies to include all employees in compliance with the new law.


Colorado Wage Protection Rule 2022

Update Applicable to:
All employers in Colorado.

What happened?
On November 10, 2021, the Colorado Department of Labor (CDLE) adopted a rule known as the Wage Protection Rules, 7 CCR 1103-7, that will include but not be limited to the Colorado Wage Act (CWA), The Healthy Families and Workplaces Act (HFWA) and the Agricultural Labor Rights and Responsibilities Act.

What are the details?
Effective January 1, 2022, Rule 2.17 prohibits “use-it-or-lose-it” vacation policies, and that all “earned” and “determinable” vacation pay must be paid at the end of an employment relationship regardless of any purported forfeiture agreement.  Employers must pay out unused and accrued vacation time at the end of employment as outlined in  C.R.S. § 8-4-101(14)(a)(III).

Employers that may have a generous Paid Time Off (PTO) policy that meets the Colorado State’s minimum Paid Sick Leave (PSL) requirements may include vacation, sick leave, holidays, and personal days that were not required to be paid out upon separation. However, the CDLE defines that when PTO is usable at the employee’s discretion (other than procedural requirements such as notice and approval of particular dates), rather than leave usable only upon the occurrence of a qualifying event (for example, a medical need, caretaking requirement, bereavement, or holiday). PTO would apply to this definition if utilized for vacation purposes, thus being paid out to the employee upon separation.

Rule 3.5.2 provides more details on how to calculate the number of hours and pay rate for HFWA leave to clarify its application to various unusual situations, such as when the employee is or has:

  • A variable pay rate
  • Not yet worked for 30 days
  • Indeterminate shifts that are open-ended in length and end at a time dictated by business needs rather than at a set time
  • “On call” hours

While this rule helps to add clarity around calculating the number of hours and pay rate for this leave, employers should note this is for HFWA purposes and is significantly different from the regular rate of overtime purposes under COMPS order #38.

For more information, please see the links below:

7 CCR 1103-7 Wage Protection Rules ADOPTED

Statement of Basis and Purposes

COMPS Order #38

Article 1Article 2

What do employers need to do?
Employers should review the links provided above, their vacation and/or paid time off policies, and prepare to make adjustments to their payroll system.

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