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