New Equal Pay Rules Dial Back Some Business Concerns
Last month, we appealed to you, our members, to share your concerns regarding proposed rules for Colorado’s Equal Pay and Equal Work Act. Thanks to your extensive and thoughtful feedback, we were able to highlight the many challenges posed by the draft rules both in writing and through our testimony at the rulemaking hearing on Nov. 2. And, this last week, we learned that the Colorado Department of Labor and Employment (CDLE) listened.
CDLE added key exemptions and much-needed clarity to the rules while keeping the law’s purpose intact – to eliminate pay disparities based on gender, race, sexual orientation, age, religion, disability and national origin. We strongly support that purpose and want to be sure the act’s implementation will not impose burdens on employers that don’t advance us toward that goal or actually end up hurting employees’ chances at promotions during an already challenging time.
Under the new law beginning Jan. 1, employers will no longer be able to ask the salary history of a prospective employee or rely on their wage history for determining the employee’s pay. Only in limited circumstances can an employer justify pay differentials based on gender, such as:
- A seniority system
- A merit system
- A system that measures earnings by quantity or quality of production
- The geographic location where the work is performed
- Education, training or experience to the extent that they are reasonably related to the work
- Travel, if the travel is a regular and necessary condition of the work performed
The law also includes requirements pertaining to how employers must post jobs and maintain records, including employers with employees outside Colorado. Employers are required to post all job openings and promotions within the company and disclose the hourly or salary compensation and benefits associated with the position.
At the hearing, we shared our concerns on posting compensation, benefits and promotions, as well as where and when job postings must take place, particularly for companies that also operate outside Colorado. Here’s what the newly released rules say.
- Posting compensation and benefits information – We voiced concerns about posting the details of benefits packages, because these packages are often a competitive hiring tool and change frequently. In response, the Department added “a general description of” benefits, commissions and other compensation. This will save employers from having to provide detail about each benefit and allow more general language.
- Posting promotions – The CDLE provided greater flexibility with regard to how employers must post promotional opportunities and now recognize exceptions for such postings including confidential hiring, automatic promotion after a trial period and interim hires.
- Posting outside Colorado – The new rules eased geographic requirements on postings, saying they do not apply to employees, postings and jobs outside Colorado addressing some of the very serious legal concerns we had about such requirements.
Thank you for sharing your feedback on the Equal Pay and Equal Work Act rules. You helped us effectively advocate for employers and create more thoughtful regulations for you and your employees.
We will continue to keep you informed of laws taking effect Jan. 1 that may impact your business, as well as the legislative issues we see ahead in 2021. Your insights and perspectives will be critical to work as the legislative session kicks off in January.
With more than 4,000 COVID-19 cases on average a day and one in 110 Coloradans actively contagious with the virus, Colorado Gov. Jared Polis issued a call Sunday for businesses to continue to allow their employees to work remotely as much possible. Elected officials and businesses from across the state – from Pueblo to Arvada to Routt County – supported the Governor’s call and said their teams would be work remotely to slow the spread of COVID-19. At the Chamber, our team continues to work remotely and we encourage businesses to do the same as much as possible so we can beat back this pandemic. Read Gov. Polis’ press release.
Stay tuned and stay healthy.
Kelly Brough is the president and CEO of the Denver Metro Chamber.