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February 8, 2023 HB 23-1118
Legislative Council Staff
Nonpartisan Services for Colorado’s Legislature
Fiscal Note
Drafting Number:
Prime Sponsors:
LLS 23-0182
Rep. Sirota;
Gonzales-Gutierrez
Sen. Gonzales; Winter F.
Date:
Bill Status:
Fiscal Analyst:
February 8, 2023
House Business
Erin Reynolds | 303-866-4146
erin.reynolds@coleg.gov
Bill Topic: FAIR WORKWEEK EMPLOYMENT STANDARDS
Summary of
Fiscal Impact:
☒ State Revenue
☒ State Expenditure
☐ State Transfer
☐ TABOR Refund
☐ Local Government
☐ Statutory Public Entity
The bill creates new labor standards and requirements related to employee work
schedules and wages for employers in the food and beverage establishment, food and
beverage manufacturer, and retail establishment sectors. It will increase state
expenditures and may increase state revenue on an ongoing basis beginning in
FY 2023-24.
Appropriation
Summary:
For FY 2023-24, the bill requires an appropriation of $329,383 to the Department of
Labor and Employment.
Fiscal Note
Status:
The fiscal note reflects the introduced bill.
Table 1
State Fiscal Impacts Under HB 23-1118
Budget Year
FY 2023-24
Out Year
FY 2024-25
Revenue - -
Expenditures Cash Funds $329,383 $426,879
Centrally Appropriated $59,048 $90,904
Total Expenditures $388,431 $517,783
Total FTE 3.0 FTE 4.8 FTE
Transfers - -
Other Budget Impacts - -
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February 8, 2023 HB 23-1118
Summary of Legislation
The bill creates new labor standards and requirements for employers in the food and beverage
establishment, food and beverage manufacturer, and retail establishment sectors related to employee
work schedules and wages.
The Division of Labor Standards and Statistics (DLSS) in the Colorado Department of Labor and
Employment (CDLE) is authorized to investigate complaints and aggrieved employees may also bring
action in district court.
Background
Using data from the Colorado Labor Market Information Gateway available for the North American
Industry Classification System codes that are specified in the bill, there are approximately
326,000 Colorado employees (or 13.9% of the private sector workforce) that are covered by the bill.
State Revenue
The bill may increase state cash fund revenue from employer penalties to the Wage Theft Enforcement
Fund. Overall, any revenue is expected to be minimal as the Colorado Wage Act encourages the DLSS
to waive most fines assessed against employers if the employer complies with the law. Any revenue
from court filing fees is also expected to be minimal.
State Expenditures
The bill increases state expenditures in CDLE by $388,431 in FY 2023-24 and $517,783 in FY 2024-25
and ongoing, paid from the Employer Support Fund. Any impact to the Judicial Department is
expected to be minimal. Expenditures are shown in Table 2 and detailed below.
Table 2
Expenditures Under HB 23-1118
FY 2023-24 FY 2024-25
Department of Labor and Employment
Personal Services $277,468 $405,884
Operating Expenses $4,050 $6,480
Capital Outlay Costs $33,350 -
Software Licenses $14,515 $14,515
Centrally Appropriated Costs
1
$59,048 $90,904
Total Cost $388,431 $517,783
Total FTE 3.0 FTE 4.8 FTE
1
Centrally appropriated costs are not included in the bill's appropriation.
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February 8, 2023 HB 23-1118
Department of Labor. The DLSS will respond to complaints under the bill with an estimated 4.8 FTE
additional management, investigator, legal, and policy staff, as outlined below.
Assumptions. Based on complaints currently filed under the Healthy Families and Workplaces
Act, the fiscal note assumes that the DLSS will receive 60 complaints per year. Of these,
40 complaints will require approximately 50 hours of investigation, and 20 complaints will require
the issuance of compliance orders that require follow-up monitoring, estimated to require about
70 hours of investigation. Additionally, it is assumed that the DLSS will conduct 10 systemic
investigations of specific employers, where an audit of general compliance with laws is conducted,
at about 250 hours of investigation.
Personal services. DLSS requires 1.0 FTE Program Manager to create and manage the new
program. It requires 2.8 FTE Compliance Investigator II to process, investigate, and adjudicate
complaints of varying complexity, and to issue orders and confirm compliance in more complex
cases. It requires 0.3 FTE Administrative Law Judge II to hear and adjudicate appeals in an
estimated 10 percent of cases. Finally, it requires Program Assistant and Policy Advisor staff
support in the initial year, primarily for the rulemaking and initial program stand-up, that will
reduce to a total of 0.7 FTE between the positions on an ongoing basis. Existing legal services
resources, provided by the Department of Law, are expected to be sufficient for rulemaking.
Standard operating and capital outlay costs are included for staff, as well as licenses for software
used by the division. First-year costs are prorated for the General Fund pay date shift a
January 1, 2024, start date, except for the manager and policy positions, which are prorated for a
September 1, 2024, start date. See Technical Note.
Judicial Department. Any trial court workload impact is expected to be minimal. Since the DLSS
will adjudicate cases administratively, additional case filings in district court will be small in number.
Centrally appropriated costs. Pursuant to a Joint Budget Committee policy, certain costs associated
with this bill are addressed through the annual budget process and centrally appropriated in the Long
Bill or supplemental appropriations bills, rather than in this bill. These costs, which include employee
insurance and supplemental employee retirement payments, are shown in Table 2.
Other Budget Impacts
General Fund reserve. Under current law, an amount equal to 15 percent of General Fund
appropriations must be set aside in the General Fund statutory reserve. Based on this fiscal note, the
bill is expected to increase the amount of General Fund held in reserve by the amounts shown in
Table 1, decreasing the amount of General Fund available for other purposes.
Technical Note
The bill is effective January 1, 2024. The fiscal note assumes that the effective date will be modified to
allow the department to set up the standards beginning September 1, 2023, following a petition clause
timeline, and that the standards will be in effect by January 1, 2024. Page 4
February 8, 2023 HB 23-1118
Effective Date
The bill takes effect January 1, 2024, and applies to conduct occurring on or after that date.
State Appropriations
For FY 2023-24, the bill requires an appropriation of $329,383 from the Employer Support Fund to the
Department of Labor and Employment and 2.8 FTE.
Departmental Difference
The Department of Labor and Employment requests General Fund be used to enforce the bill’s labor
standards. The federal Department of Labor has determined that certain spending from the Employer
Support Fund is not in compliance with federal law. Until the fund is back into compliance, the CDLE
prefers not to make additional expenditures from this fund. The fiscal note assumes that these
administrative costs constitute allowable uses of funds in the Employer Support Fund.
State and Local Government Contacts
Corrections Counties Human Services
Information Technology Judicial Labor
Law Municipalities Natural Resources
Personnel Public Safety Transportation
The revenue and expenditure impacts in this fiscal note represent changes from current law under the bill for each
fiscal year. For additional information about fiscal notes, please visit: leg.colorado.gov/fiscalnotes.