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Employment Law

U.S. Supreme Court Hears Oral Arguments on Colorado Business’s First Amendment Speech Rights

U.S. Supreme Court Hears Oral Arguments on Colorado Business’s First Amendment Speech Rights

Jason Fisher

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The U.S. Supreme Court heard oral arguments last month in a case challenging the Colorado Anti-Discrimination Act (CADA) in a scenario similar to the Masterpiece Cakeshop decision of 2018. 303 Creative LLC, a Colorado based graphic design service is seeking to provide wedding website design services but only for opposite-sex weddings due to the owner’s religious beliefs that preclude her from providing the same services for same-sex couples.

303 Creative LLC is classified as a “public accommodation” under CADA and therefore subject to its prohibition on refusing service to an individual or group on the basis of sexual orientation. CADA further prohibits businesses from announcing an intent to discriminate in this manner. A public accommodation is defined under CADA as “any place of business engaged in any sales to the public and any place offering services, facilities, privileges, advantages, or accommodations to the public.”

303 Creative LLC is bringing a pre-enforcement challenge against CADA meaning Colorado authorities have not alleged any wrongdoing, rather 303 Creative LLC is bringing the case to permit an exception to CADA for a planned announcement that it will not provide services for same-sex marriages to be posted on its website. 303 Creative LLC’s argument is rooted in the First Amendment’s protection of free speech whereas Colorado has asserted that CADA regulates conduct, not speech, by requiring only that the business provide services to anyone who wants to pay for them.

It will likely be several more months before a decision is issued in this case, but groups protected by CADA and business owners should follow along closely. A decision in 303 Creative LLC’s favor may permit businesses to deny service to certain individuals and groups currently protected by CADA’s public accommodation laws. If this comes to pass business owners should consider the reputational harm that will result from adopting a policy of refusing service and must avoid fostering a hostile work environment in which harassment or discrimination may occur which would still result in legal ramifications.

If you are a business owner it is ever more important to adopt strong policies addressing workplace accommodation, anti-harassment, and discrimination to promote a healthy work environment and head off potential legal claims.

ABOUT THE AUTHOR

ASSOCIATE

Jason focuses his practice on corporate governance, commercial finance, commercial contracts, and employment law. He advises clients on all aspects of general corporate matters and strategic business decisions including organization structure, operating/shareholder agreements, and private debt and equity offerings.

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Employment Law

U.S. Supreme Court Hears Oral Arguments on Colorado Business’s First Amendment Speech Rights

The U.S. Supreme Court heard oral arguments last month in a case challenging the Colorado Anti-Discrimination Act (CADA) in a scenario similar to the Masterpiece Cakeshop decision of 2018. 303 Creative LLC, a Colorado based graphic design service is seeking to provide wedding website design services but only for opposite-sex weddings due to the owner’s religious beliefs that preclude her from providing the same services for same-sex couples.

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Estate Planning

Should I Consider an Ethical Will?

A Last Will and Testament seems to be on most people’s radar, especially individuals with young children, individuals who have lost a loved one, or just individuals who consider themselves to be “Type A” planners. But what about an ethical will? What is an ethical will and why might you consider executing one as part of your legacy planning?

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Employment Law

Two New Colorado Laws Affecting Employers in August and October 2022

Two New Colorado Laws Affecting Employers in August and October 2022

Jason Fisher

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Two new laws are set to take effect in the coming months that will require employees to examine their current practices and make changes to bring themselves into compliance.

House Bill 22-1317, taking effect in August 2022, substantially alters how non-competition agreements can be structured with Colorado employees and the Colorado Secure Savings Program, which will apply beginning in October 2022, requires employers to enroll in a state-run workplace retirement plan or provide their own.

House Bill 22-1317 – August 2022

Currently, Colorado law permits non-competition agreements with limited duration and geographic scope in several circumstances including for the protection of trade secrets and for executive or management personnel. HB 22-1317 removes these permitted exceptions and replaces them with only one circumstance: highly compensated employees (meaning those making $101,250 per year or more) for the protection of trade secrets provided the restriction not to compete is no broader than reasonably necessary to protect trade secrets. Customer non-solicitation agreements will be similarly limited to only those employees making at least 60% of the highly compensated threshold ($60,750 per year) and only as is reasonably necessary for the protection of trade secrets. These salary thresholds must be met both at the time the agreement was entered as well as at the time the agreement is being enforced.

These changes are not retroactive and so only apply to non-competition and non-solicitation agreements entered into after the effective date. Further, HB 22-1317 does not change the existing exceptions for non-competition agreements relating to the sale of a business or the recovery of educational and training expenses though the amendment does clarify what expenses are recoverable.

HB 22-1317 requires employers to provide a separate, written notice of any non-competition covenants and have such notice signed by the employee. In addition to being void, a non-competition agreement which does not satisfy the requirements of HB 22-1317 could make the employer liable for actual damages, reasonable costs, attorneys’ fees, and statutory penalties of up to $5,000 per employee. To avoid these damages, Colorado employees need to examine their current practices to avoid running afoul of the increasing restrictions on non-competition agreements.

Secure Savings Program – October 2022

With the launch of the Secure Savings Program, Colorado is joining fourteen other states in requiring employers provide a workplace retirement savings plan. The pilot program launches in October 2022 and will apply to all Colorado employers with five or more employees who have been in business for two or more years starting January 1, 2023.

Colorado employers who do not have a qualifying plan will be required to participate in the state-run program and offer enrollment to their employees and facilitate payroll deductions. Once enrolled, employees will be opted into a default savings rate of five percent of their gross pay. Employees will be able to change their contribution amount or opt out if desired.

Penalties for non-compliance can be up to $100 per employee per year increasing up to $5,000 per employee per year if non-compliance is ongoing. However, employers are provided one year from the effective date to bring themselves into compliance. Small businesses who have not previously considered a workplace retirement plan should begin considering the options available to them and whether an employer sponsored plan or the state-run program will better fit their organization.

ABOUT THE AUTHOR

ASSOCIATE

Jason focuses his practice on corporate governance, commercial finance, commercial contracts, and employment law. He advises clients on all aspects of general corporate matters and strategic business decisions including organization structure, operating/shareholder agreements, and private debt and equity offerings.

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Data Privacy

Navigating and Complying with Colorado’s New Consumer Privacy Act

On July, 7, 2021, Colorado Governor Jared Polis signed the Colorado Privacy Act (CPA or “the Act”) into law. With that pen stroke, Colorado joined California and Virginia as the third state to enact comprehensive consumer privacy legislation. While the law does not take effect until July 1, 2023, Colorado businesses would do well to study up on the new law to ensure compliance when it does become active.

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Business & Corporate Law

The Small Business Reorganization Act and Its Prolonged Adoption Through June of 2024

Chapter 11 bankruptcy code generally provides businesses with avenues and protections to reorganize and restructure obligations. This form of bankruptcy is very often more favorable than chapter 7 bankruptcy because it allows business owners to stay in the driver’s seat while attempting to negotiate a plan that complies with the bankruptcy code. In contrast, filing a chapter 7 petition results in full relinquishment of control of the business and the appointment of a third-party trustee whose primary obligation to is to liquidate estate assets for the benefit of unsecured creditors.

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Business & Corporate Law

Beneficial Ownership Disclosure: New Reporting Requirements for Small Businesses

On September 30, 2022, the U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) issued its highly anticipated Final Rule establishing a beneficial ownership information (BOI) reporting requirement under the Corporate Transparency Act (CTA) of 2019. These rules significantly change the obligations of business entities to disclose previously private information regarding the ownership and control of these entities. The primary purpose of the CTA, enacted as part of the Anti-Money Laundering Act of 2020 is to protect the US financial system from being used for illicit purposes, including preventing corrupt actors, terrorists, and criminals from hiding assets in anonymous shell companies. Background for this rule was addressed in prior blog posts including The Corporate Transparency Act (1/31/22) and FinCEN and Real Estate (8/2/22).

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Copyright Law

Important Legal Issues for Buyers and Sellers of NFTs

Important Legal Issues for Buyers and Sellers of NFTs

Jason Fisher

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WHAT ARE NFTS?

NFTs are the latest digital asset to have taken the world by storm. Similar to cryptocurrencies like Bitcoin or Ethereum, NFTs are recorded on a blockchain ledger to verify ownership. However, while a cryptocurrency’s tokens are interchangeable and indistinguishable, each NFT is a unique asset such as a particular document, image, or video.

POTENTIAL FOR INFRINGEMENT AND ENFORCEMENT

Those who buy and use or resell NFTs should be particularly aware of the potential for infringement. Generally, NFT marketplaces verify sellers to ensure authenticity, however, this does not eliminate the possibility that a NFT is infringing another’s intellectual property rights. As a result, buyers should always conduct their own due diligence.

Last July, Opensea, a leading marketplace for the resale of NFTs,  delisted a seller after receiving a Digital Millennium Copyright Act (“DMCA”) notice alleging infringement. The delisted seller, “CryptoPhunks” was parodying NFTs created by, “CryptoPunks”, a very well-known seller who submitted the DMCA notice. Reactions to the CryptoPhunks delisting were mixed with many accusing the platform of censorship. What many critics may not realize is that Opensea was protecting not only themselves but potential purchasers of CryptoPhunks NFTs.

Under Section 504 of the Copyright Act, any person who sells an infringing work can be liable for statutory damages between $750 and $30,000 per infringement. This applies whether or not the seller knew that they were selling infringing material. With this, CryptoPunks would have been able to bring a claim against any person who bought and resold a NFT from CryptoPhunks based on alleged infringement.

Further, the Copyright Alternative in Small Claims Enforcement Act (the “CASE Act”), which passed  in late 2020, is designed to streamline the process by which CryptoPunks or other owners of allegedly infringed property can bring these claims. By providing a cheaper and less expensive framework for copyright litigation, the CASE Act incentivizes rightsholders to enforce their rights in situations which previously would not be worth the hassle of federal court and is likely to increase NFT-related enforcement actions.

When deciding whether to purchase NFTs, all potential buyers should consider the possibility of infringement and the potential for personal liability . Some risky parodies may provide resale value —and a good laugh—but ultimately will not be worth the headache of defending an enforcement action.

ABOUT THE AUTHOR

ASSOCIATE

Jason focuses his practice on corporate governance, commercial finance, commercial contracts, and employment law. He advises clients on all aspects of general corporate matters and strategic business decisions including organization structure, operating/shareholder agreements, and private debt and equity offerings.

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Miscellaneous

When Shares are Not Cares

As attorneys representing startups, Milgrom & Daskam knows that early-stage businesses often have many needs and not much capital to meet them. This often results in startups bartering for services using whatever currency they have. Sometimes this results in interesting exchanges (two hundred pounds of Valencia oranges in exchange for a logo design being our personal benchmark); more often it results in founders giving away the most freely available form of credit they have—equity in their company.

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Copyright Law

Should You Seek Foreign Intellectual Property Protection?

If you plan to conduct business abroad or have an online business that reaches customers abroad, you should consider seeking international intellectual property protection. Intellectual property protection is often limited to the country where you conduct business and/or where you file for protection with the respective foreign intellectual property office. For example, a U.S. trademark registration will not protect you against trademark disputes that arise in other countries. As another example, a U.S. patent prevents others from making, using, selling, offering for sale, and importing your patented invention in the U.S., but does not prevent others from doing the same in other countries.

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Categories
Employment Law

Colorado’s Equal Pay for Equal Work Act: What Employers Should Know

Colorado’s Equal Pay for Equal Work Act: What Employers Should Know

Jason Fisher

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Colorado’s Equal Pay for Equal Work ACT (“EPEWA”) became effective January 1, 2021, and all companies that employ Coloradans should be aware of its provision—which may require an update to employer practices and policies—to avoid liability.

By enacting EPEWA, the Colorado legislature seeks to prohibit wage discrimination on the basis of sex, which includes gender identity, or on the basis of sex combined with another protected trait such as disability, race, creed, color, national origin, sexual orientation, religion, age, or ancestry. However, EPEWA also contains provisions regulating (1) what information is required in job listings, (2) who is notified of promotional opportunities, and (3) how interviews are conducted regarding wages.

JOB LISTINGS

All job listings open to Colorada applicants must include the following:

  • The hourly or salary compensation offered (a reasonable range is acceptable);
  • A description of all benefits offered such as health, retirement, and paid time off;
  • A description of any other compensation offered such as bonus or equity incentives.

PROMOTIONAL OPPORTUNITIES

Employers must further make a “reasonable effort” to notify current employees of promotional opportunities. Such notice must be in writing and made available on the same day to all employees for whom the opportunity would be a promotion. It must also be given far enough in advance of having the position filled to allow employees a reasonable time to apply.

INTERVIEW QUESTIONS REGARDING PAY

When performing interviews with applicants for new positions or promotional opportunities, employers are prohibited from asking how much the applicant made in their previous position or any other questions regarding the applicant’s wage rate history. Further, if an employer learns of an applicant’s wage rate history, the employer is prohibited from using that information in determining the applicant’s new compensation.

COSTS OF VIOLATIONS

Employers who fail to comply with the provisions of EPEWA leave themselves open to complaints filed by employees with the Colorado Department of Labor and Employment (“CDLE”). CDLE will conduct investigations into alleged violations, and employers will be required to turn over any documentation requested that has bearing on the complaint. If a violation is found, employers can face fines between $500.00 and $10,000.00 for each violation. They may also be required to provide back pay and other damages to employees who were subject to the violating conduct.

The legal ins and outs of employment are constantly changing. Employers should regularly revisit their internal policies and procedures to ensure compliance and update those practices as required. If you are an employer concerned about compliance with EPEWA, please reach out to Milgrom & Daskam for a free consultation.

ABOUT THE AUTHOR

ASSOCIATE

Jason focuses his practice on corporate governance, commercial finance, commercial contracts, and employment law. He advises clients on all aspects of general corporate matters and strategic business decisions including organization structure, operating/shareholder agreements, and private debt and equity offerings.

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Employment Law

Workplace Accommodations for Nursing Mothers

Many women choose to breastfeed their newborns, as the benefits of nursing are well-established. However, returning to work can present challenges to nursing mothers. Currently, twenty-eight states have laws related to supporting nursing women at work, and Colorado is among them.

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Real Estate Law

FinCEN and Real Estate: Additional Disclosure Requirements May Be On the Horizon for Real Estate Transactions

As part of the anti-money laundering regime under the Bank Secrecy Act of 1970 (the “BSA”), in late 2021, the Financial Crimes Enforcement Network (“FinCEN”) division of the Department of the Treasury issued an advanced notice of proposed rulemaking (“ANPRM”) seeking to address potential money laundering through real estate transactions. The comment period for the ANPRM closed on February 21, 2022. This ANPRM comes closely after the notice of proposed rulemaking related to the implementation of the Corporate Transparency Act (the “CTA”), which you can read more about here. Both the CTA and the proposed regulations under the ANPRM would require significant levels of disclosure regarding the beneficial ownership of companies and real estate in non-financed real estate transactions. These measures aim to reduce money laundering, and assets held by undisclosed foreign investors. It is estimated that between 2015 and 2020, at least $2.3 billion was laundered through U.S. real estate, though the actual figure is likely much higher Accordingly, both FinCEN and Congress are trying to limit the number of real estate transactions used to launder money.

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Categories
Employment Law

Navigating Mandatory COVID-19 Vaccination as an Employer

Navigating Mandatory COVID-19 Vaccination as an Employer

Jason Fisher

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According to recent guidance published by the U.S. Equal Employment Opportunity Commission (EEOC), private employers may require employees to receive a COVID-19 vaccination. The EEOC enforces workplace anti-discrimination laws, including the Americans with Disabilities Act (ADA) and the Rehabilitation Act, both of which impact an employer’s ability to require vaccination against COVID-19. In addition, emerging, state-specific regulations will determine employers’ vaccination policies. Prior to enacting a vaccine requirement, employers must understand their legal responsibilities under federal and state law.

The ADA allows an employer to enforce a policy that includes “a requirement that an individual shall not pose a direct threat to the health or safety of individuals in the workplace.” This is the same standard that enables employers to require COVID-19 testing of employees who exhibit symptoms before allowing those employees to enter the workplace, and it is now being applied to enable employers to require vaccinations.

When applying this standard to required vaccinations, the employer must examine whether such a requirement screens out, or tends to screen out, an individual with a disability. For example, persons who are immunocompromised or taking certain medications may be unable to receive the vaccine due to a qualifying disability. If so, the employer must show that an unvaccinated employee would pose a direct threat due to a “significant risk of substantial harm to the health or safety of the individual or others that cannot be eliminated or reduced by reasonable accommodation.” 29 C.F.R. 1630.2(r).

A conclusion that there is a direct threat would include a determination that an unvaccinated individual will expose others in the workplace to the virus.

Even after the employer concludes that there is a direct threat, the employer cannot immediately exclude the employee from the workplace or take any other action. The employer must still determine that there is no way to provide a reasonable accommodation that would eliminate or reduce this risk so that the unvaccinated employee does not pose a direct threat.

Employers must also consider whether any state-specific laws pertain to their vaccine requirements. While not yet in effect, legislation proposed in a number of states would restrict an employer’s ability to require vaccination. Some of this legislation would prohibit employer-required vaccinations outright, while, in other states, the legislation would permit required vaccinations only for employees in healthcare facilities or for those who work with medically vulnerable populations. The proposed legislation in Colorado would impose a broad restriction on employer-required vaccinations by prohibiting employers from taking adverse actions against employees or applicants based on vaccination status.

Employers must be ready to adapt their policies as the range of requirements applicable to mandatory vaccinations expands, and this is an area ripe for employee litigation. It is highly recommended that employers speak with an attorney to determine whether their current or proposed policy complies with federal and state law.

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ABOUT THE AUTHOR

ASSOCIATE

Jason focuses his practice on corporate governance, commercial finance, commercial contracts, and employment law. He advises clients on all aspects of general corporate matters and strategic business decisions including organization structure, operating/shareholder agreements, and private debt and equity offerings.

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Work-Life Balance

Not All Who Wander are Lost

When I joined Milgrom & Daskam at the height of COVID, I wasn’t sure what the future would look like for me or this relatively young firm. We were giving up our physical office space in downtown Denver and embarking on a new vision for remote workers. Up until then, much of my professional work life was spent in an office environment, surrounded by colleagues My days were punctuate by in-person meetings–formal, over coffee or meals.in the hallways–and bookended by my daily commute between Denver and Los Angeles which ranged anywhere from just under 30 minutes to more than an hour.

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Estate Planning

Estate Planning for Women: Helping with Control

Let me get it out of the way…the elephant in the room after such a polarizing title. Estate planning is for everyone. Period. Regardless of your age, your marital status, your perceived wealth, or your family size, everyone benefits from preparing for the unexpected, covering essentials, ensuring a lifestyle, and ultimately leaving a legacy with minimal probate and family disputes.

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