First Regular Session Seventy-fifth General Assembly STATE OF COLORADO REENGROSSED This Version Includes All Amendments Adopted in the House of Introduction LLS NO. 25-0015.02 Yelana Love x2295 HOUSE BILL 25-1001 House Committees Senate Committees Business Affairs & Labor Finance Appropriations A BILL FOR AN ACT C ONCERNING THE ENFORCEMENT OF WAGE AND HOUR LAWS, AND, IN101 CONNECTION THEREWITH , MAKING AN APPROPRIATION .102 Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://leg.colorado.gov .) Section 1 of the bill amends the definition of "employer" for purposes of wage and hour laws to include an individual who owns or controls at least 25% of the ownership interest in an employer. Section 2 prohibits an employer from making a payroll deduction below a worker's applicable minimum wage. Section 3 allows the director of the division of labor standards and HOUSE 3rd Reading Unamended April 2, 2025 HOUSE Amended 2nd Reading April 1, 2025 HOUSE SPONSORSHIP Duran and Froelich, Bacon, Boesenecker, Clifford, English, Garcia, Hamrick, Lieder, Mabrey, Martinez, Mauro, Rutinel, Sirota, Titone, Velasco, Willford, Zokaie, Bird, Brown, Espenoza, Jackson, Joseph, Lindsay, Lindstedt, McCormick, Phillips, Rydin, Smith, Story SENATE SPONSORSHIP Danielson and Kolker, Bridges, Cutter, Gonzales J., Hinrichsen, Kipp, Marchman, Michaelson Jenet, Sullivan, Weissman, Winter F. Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment. Capital letters or bold & italic numbers indicate new material to be added to existing law. Dashes through the words or numbers indicate deletions from existing law. statistics (division) to waive the penalty for an employer's failure to pay claimed wages or compensation within 14 days after a written demand if certain specified conditions are met. Section 4 repeals language allowing a court to award an employer reasonable costs and attorney fees in a civil action for unpaid wages or compensation in certain circumstances. In such an action, the court may pursue all equitable relief to deter future violations and prevent unjust enrichment. Current law limits the ability of the director of the division to adjudicate claims for nonpayment of wages or compensation to $7,500 or less. Section 5 increases this threshold over the years by increasing the amount to $13,000 for claims filed from July 1, 2026, through December 31, 2027, and in an amount specified by the director of the division to adjust for inflation beginning January 1, 2028. Section 5 also requires the division, in adjudicating wage claims, to determine whether a violation is willful. For each violation: ! The director shall publish on the division's website the names of all employers found to be in violation and whether the violation was willful; and ! If the violation is not remedied within 60 days after the division's finding that there was a violation, the division must notify all government bodies with the authority to deny, withdraw, or otherwise limit or impose remedial conditions on the employer's license, permit, registration, or other credential. Additionally, the division may report an employer found to have violated a law related to wages and hours to any government body with authority to deny, withdraw, or otherwise limit or impose remedial conditions on a license, permit, registration, or other credential that the violating employer has or may seek. Section 5 also repeals language requiring the division to issue a determination on a wage complaint within 90 days. Section 6 requires an employer found to have misclassified an employee as a nonemployee to pay a fine in the following amounts, in addition to any other relief ordered: ! For a willful violation, $5,000; ! For a violation not remedied within 60 days after the division's finding, $10,000; ! For a second or subsequent willful violation within 5 years, $25,000; or ! For a second or subsequent willful violation not remedied within 60 days after the division's finding, $50,000. The director of the division must adjust these fine amounts for inflation by January 1, 2028, and every other year thereafter. Section 6 also decreases the amount of time the division must wait 1001 -2- before paying an employee out of the wage theft enforcement fund from 6 months to 120 days. Current law prohibits an employer from discriminating or retaliating against an employee for taking protection under wage and hour laws or the law related to the employment of minors. Section 7 expands this provision to specify additional protected behavior and expands the prohibition to include other persons in addition to employers. Section 7 also: ! Requires a fact finder to consider the time between an individual's exercise of a protected activity and an employer's adverse action when determining whether an employer has retaliated against the employee or worker; ! Specifies that any effort to use an individual's immigration status to negatively impact the wage and hour law rights, responsibilities, or proceedings of any employee or worker is an unlawful act of intimidation, threatening, coercion, discrimination, and retaliation; and ! Allows the division to order reasonable attorney fees and costs after investigating a discrimination or retaliation claim. Be it enacted by the General Assembly of the State of Colorado:1 SECTION 1. In Colorado Revised Statutes, 8-4-101, amend (6)2 as follows:3 8-4-101. Definitions. As used in this article 4, unless the context4 otherwise requires:5 (6) "Employer" has the same meaning as set forth in the federal6 "Fair Labor Standards Act of 1938", 29 U.S.C. sec. 203 (d), and includes7 a foreign labor contractor, and a migratory field labor contractor or crew8 leader, AND EACH INDIVIDUAL WHO OWNS OR CONTROLS AT LEAST9 TWENTY-FIVE PERCENT OF THE OWNERSHIP INTERESTS IN AN EMPLOYER ;10 except that the provisions of this article 4 do DOES not apply to A11 MINORITY OWNER OF AN EMPLOYER THAT DEMONSTRATES FULL12 DELEGATION OF ITS AUTHORITY TO CONTROL DAY -TO-DAY OPERATIONS OF13 THE EMPLOYER; the state or its agencies or entities; counties; cities and14 1001-3- counties; municipal corporations; quasi-municipal corporations; school1 districts; and irrigation, reservoir, or drainage conservation companies or2 districts organized and existing under the laws of Colorado.3 SECTION 2. In Colorado Revised Statutes, 8-4-105, amend (2)4 as follows:5 8-4-105. Payroll deductions permitted - notice required.6 (2) Nothing in this section authorizes a deduction below the APPLICABLE7 minimum wage. applicable under the "Fair Labor Standards Act of 1938", 8 29 U.S.C. sec. 201 et seq.9 SECTION 3. In Colorado Revised Statutes, 8-4-109, amend10 (3)(b) introductory portion; and add (3.5) as follows:11 8-4-109. Termination of employment - payments required -12 civil penalties - payments to surviving spouse or heir. (3) (b) On or13 after January 1, 2023 EXCEPT AS PROVIDED IN SUBSECTION (3.5) OF THIS14 SECTION, if an employer fails or refuses to pay, in the manner specified15 in subsection (3)(d) of this section, all earned, vested, and determinable16 wages or compensation within fourteen days after the A written demand17 is sent or within fourteen days after a civil action or administrative claim18 for the wages or compensation is sent to or served on the employer, the19 employer is liable to the employee or group of similarly situated20 employees for the amount of the earned, vested, determinable, and unpaid21 wages or compensation plus an automatic penalty of:22 (3.5) T HE DIRECTOR MAY WAIVE THE PENALTY SPECIFIED IN23 SUBSECTION (3)(b) OF THIS SECTION FOR AN EMPLOYER'S FAILURE TO PAY24 CLAIMED WAGES OR COMPENSATION WITHIN FOURTEEN DAYS AFTER A25 WRITTEN DEMAND IF THE EMPLOYER PAYS ALL CLAIMED WAGES OR26 COMPENSATION WITHIN FOURTEEN DAYS AFTER AN ADMINISTRATIVE27 1001 -4- CLAIM FOR THE SAME WAGES OR COMPENSATION IS SENT TO OR SERVED ON1 THE EMPLOYER. THE DIRECTOR SHALL NOT WAIVE THE PENALTY IF THE2 ALLEGED VIOLATION IS A SECOND OR SUBSEQUENT FAILURE OR REFUSAL3 TO PAY AN EMPLOYEE'S WAGES OR COMPENSATION WITHIN FIVE YEARS .4 SECTION 4. In Colorado Revised Statutes, 8-4-110, amend5 (1)(a) introductory portion, (1)(a)(II), and (2) as follows:6 8-4-110. Disputes - fees. (1) (a) The court may award the7 employer reasonable costs and attorney fees incurred in a civil action8 BROUGHT UNDER THIS ARTICLE 4 if, within fourteen days after a written9 demand letter is sent to or a civil action is served on the employer for10 unpaid wages or compensation:11 (II) The employees receiving such tender ultimately fail to recover12 a total sum that is greater than the amount the employer tendered THE13 COURT ULTIMATELY FINDS THAT THE EMPLOYEES RECEIVING SUCH TENDER14 PURSUED AN ACTION LACKING SUBSTANTIAL JUSTIFICATION .15 (2) Any IN ADDITION TO OTHER RELIEF AVAILABLE TO EMPLOYEES16 UNDER THIS TITLE 8, A person claiming to be aggrieved by A violation of17 any provisions of this article or regulations prescribed pursuant to this18 article THIS ARTICLE 4 OR ANY OTHER LAW OR RULE RELATED TO WAGES19 OR HOURS may file suit in any court having jurisdiction over the parties20 TO PURSUE ALL AVAILABLE EQUITABLE RELIEF , INCLUDING EQUITABLE21 RELIEF TO DETER FUTURE VIOLATIONS AND PREVENT UNJUST ENRICHMENT ,22 without regard to exhaustion of any administrative remedies.23 SECTION 5. In Colorado Revised Statutes, 8-4-111, amend24 (1)(a)(II), (2)(a)(I) introductory portion, and (8); repeal (2)(a)(III); and25 add (1)(a.5) and (9) as follows:26 8-4-111. Enforcement - duty of director - duties of district or27 1001 -5- city attorneys - local government authority to enact and enforce laws1 - rules. (1) (a) (II) The director may establish an administrative2 procedure to receive complaints and adjudicate claims for nonpayment of3 wages or compensation of:4 (A) Seven thousand five hundred dollars or less FOR CLAIMS FILED5 THROUGH JUNE 30, 2026;6 (B) T HIRTEEN THOUSAND DOLLARS OR LESS FOR CLAIMS FILED7 FROM JULY 1, 2026, THROUGH DECEMBER 31, 2027; AND8 (C) A N AMOUNT THAT THE DIRECTOR SPECIFIES IN RULE BY9 J ANUARY 1, 2028, AND BY RULE FOR EVERY OTHER YEAR THEREAFTER .10 S UCH AMOUNT MUST BE EQUAL TO THE AMOUNT IN THE PREVIOUS11 CALENDAR YEAR INCREASED BY ONE T HOUSAND DOLLARS OR A HIGHER12 AMOUNT IF SUCH HIGHER AM OUNT IS NECESSARY TO ADJUST FOR13 INFLATION. INFLATION IS MEASURED BY THE ANNUAL PERCENTAGE14 CHANGE IN THE UNITED STATES DEPARTMENT OF LABOR 'S BUREAU OF15 LABOR STATISTICS CONSUMER PRICE INDEX , OR A SUCCESSOR INDEX, FOR16 D ENVER-AURORA-LAKEWOOD FOR ALL ITEMS PAID FOR BY URBAN17 CONSUMERS.18 (a.5) I N CARRYING OUT THE DUTIES SPECIFIED IN SUBSECTION19 (1)(a)(I) OF THIS SECTION, THE DIRECTOR:20 (I) S HALL PUBLISH ON THE DIVISION 'S WEBSITE, FOR ANY21 VIOLATION THAT IS A MATTER OF PUBLIC RECORD PURSUANT TO SECTION22 8-1-115 (1)(b), THE CITATION, DETERMINATION, OR WRITTEN OPINION;23 WHETHER THE VIOLATION WAS WILLFUL ; AND THE NAMES OF ALL24 EMPLOYERS IN VIOLATION;25 (II) S HALL REPORT AN EMPLOYER WITH A WILLFUL VIOLATION26 UNREMEDIED WITHIN SIXTY DAYS AFTER THE DIVISION 'S FINDING TO ANY27 1001 -6- GOVERNMENT B ODY WITH AUTHORITY TO DENY , WITHDRAW, OR1 OTHERWISE LIMIT OR IMPOSE REMEDIAL CONDITIONS ON THE EMPLOYER 'S2 LICENSE, PERMIT, REGISTRATION, OR OTHER CREDENTIAL. THE DIVISION3 MAY POST A DECISION AGAINST AN EMPLOYER BY A GOVERNMENT BODY4 ON THE DIVISION'S WEBSITE.5 (III) M AY REPORT AN EMPLOYER FOUND TO HAVE VIOLATED A LAW6 RELATED TO WAGES AND HOURS TO A GOVERNMENT BODY WITH7 AUTHORITY TO DENY , WITHDRAW, OR OTHERWISE LIMIT OR IMPOSE8 REMEDIAL CONDITIONS ON THE EMPLOYER 'S LICENSE, PERMIT,9 REGISTRATION, OR OTHER CREDENTIAL . THE DIVISION MAY POST A10 DECISION AGAINST AN EMPLOYER BY A GOVERNMENT BODY ON THE11 DIVISION'S WEBSITE.12 (2) (a) (I) T HE DIVISION SHALL INVESTIGATE A WAGE COMPLAINT13 if one or more employees file a THE wage complaint with the division14 claiming unpaid wages or compensation, EXCLUSIVE OF PENALTIES AND15 FINES, of seven thousand five hundred dollars or less per employee16 exclusive of penalties and fines, the division shall investigate the wage 17 complaint FOR CLAIMS FILED THROUGH JUNE 30, 2026; THIRTEEN18 THOUSAND DOLLARS OR LESS FOR CLAIMS FILED FROM JULY 1, 2026,19 THROUGH DECEMBER 31, 2027; AND AN AMOUNT THAT THE DIRECTOR20 SPECIFIES IN RULE BY JANUARY 1, 2028, AND BY RULE FOR EVERY OTHER21 YEAR THEREAFTER. SUCH AMOUNT MUST BE EQUAL TO THE AMOUNT IN22 THE PREVIOUS CALENDAR YEAR INCREASED BY ONE THOUSAND DOLLARS23 OR A HIGHER AMOUNT IF SUCH HIGHER AMOUNT IS NECESSARY TO ADJUST24 FOR INFLATION. INFLATION IS MEASURED BY THE ANNUAL PERCENTAGE25 CHANGE IN THE UNITED STATES DEPARTMENT OF LABOR 'S BUREAU OF26 LABOR STATISTICS CONSUMER PRICE INDEX , OR A SUCCESSOR INDEX, FOR27 1001 -7- DENVER-AURORA-LAKEWOOD FOR ALL ITEMS PAID FOR BY URBAN1 CONSUMERS. The division may investigate any A wage complaint made2 on behalf of a group of similarly situated employees. If the division3 declines to investigate a group complaint, similarly situated employees4 may consent in writing to participate as parties to that complaint, and the5 division may pursue a direct investigation informed by and concurrent6 with that complaint. The division shall initiate the administrative7 procedure by sending a notice of complaint to the employer by mail or8 electronic means in accordance with rules as the director may promulgate9 when the complaint states a claim for relief. The notice of the complaint10 must include:11 (III) The division shall issue a determination within ninety days12 after the notice of complaint is sent unless the division extends the time13 period by providing advance written notice to the employee and employer14 stating good cause for the extension of time.15 (8) Nothing in this article shall be construed to limit ARTICLE 416 LIMITS:17 (a) The authority of the district attorney of any county or city and18 county, or the city attorney of any city A PERSON DELEGATED AUTHORITY19 BY A COUNTY OR CITY AND COUNTY TO PROSECUTE CRIMINAL OFFENSES20 OR ENFORCE LAWS OR ORDINANCES RELATED TO THE PAYMENTS OF21 WAGES, to:22 (I) Prosecute actions for such violations of this article as ARTICLE23 4 THAT may come to his or her THE DISTRICT ATTORNEY'S OR THE24 DELEGATED PERSON'S knowledge; or to25 (II) Enforce the provisions of this article THIS ARTICLE 426 independently and without specific direction of the director; or to limit27 1001 -8- (b) The right of any wage claimant to sue directly or through an1 assignee for any wages or penalty due him or her under the provisions of2 this article OR OTHER RELIEF AVAILABLE PURSUANT TO THIS ARTICLE 4.3 (9) A CITY, COUNTY, OR CITY AND COUNTY MAY ENACT AND4 ENFORCE LAWS RELATED TO THE PAYMENT OF WAGES FOR WORK5 PERFORMED WITHIN ITS JURISDICTION IF THE LAWS DO NOT DIMINISH THE6 PROTECTIONS OR BENEFITS TO EMPLOYEES PROVIDED IN THIS ARTICLE 4.7 SECTION 6. In Colorado Revised Statutes, 8-4-113, amend8 (5)(a); and add (1)(a)(I.5) as follows:9 8-4-113. Fines pursuant to enforcement - wage theft10 enforcement fund - created - administrative lien and levy of employer11 assets - wage claim payments from the fund - definition - rules.12 (1) (a) (I.5) A N EMPLOYER FOUND TO HAVE MISCLASSIFIED AN EMPLOYEE13 AS A NONEMPLOYEE IN A WAY THAT MAY AFFECT A WAGE AND HOUR14 PAYMENT OR REPORTING OBLIGATION UNDER A STATE , FEDERAL, OR LOCAL15 LAW, RULE, OR REGULATION SHALL PAY A FINE IN THE FOLLOWING16 AMOUNTS, INCREASED BY THE DIRECTOR BY RULE BY JANUARY 1, 2028,17 AND BY RULE BY JANUARY 1 EVERY OTHER YEAR BASED ON THE PRIOR18 TWO YEARS' INCREASE, IF ANY, IN THE UNITED STATES DEPARTMENT OF19 LABOR'S BUREAU OF LABOR STATISTICS CONSUMER PRICE INDEX , OR A20 SUCCESSOR INDEX, FOR DENVER-AURORA-LAKEWOOD FOR URBAN WAGE21 EARNERS AND CLERICAL WORKERS , PER EMPLOYEE, IN ADDITION TO ANY22 OTHER RELIEF ORDERED:23 (A) F OR A WILLFUL VIOLATION, FIVE THOUSAND DOLLARS;24 (B) F OR A VIOLATION NOT REMEDIED WITHIN SIXTY DAYS AFTER25 THE DIVISION'S FINDING, TEN THOUSAND DOLLARS;26 (C) F OR A SECOND OR SUBSEQUENT WILLFUL VIOLATION WITHIN27 1001 -9- FIVE YEARS, TWENTY-FIVE THOUSAND DOLLARS; OR1 (D) F OR A SECOND OR SUBSEQUENT WILLFUL VIOLATION NOT2 REMEDIED WITHIN SIXTY DAYS AFTER THE DIVISION 'S FINDING, FIFTY3 THOUSAND DOLLARS.4 (5) (a) On and after April 1, 2024, if an employer fails to pay an5 employee an amount of wages, compensation, or other monetary relief6 owed the employee, as determined by the division pursuant to this article7 4 or article 6 or 12 of this title 8 or as decided by a hearing officer8 pursuant to section 8-4-111.5, within six months ONE HUNDRED TWENTY9 DAYS after the division's determination, the hearing officer's decision, or10 the expiration of any AN order from the division, the hearing officer, or11 a court staying or postponing the employer's payment obligation,12 whichever is later, the division may disburse the amount of wages,13 compensation, or other monetary relief determined to be owed the14 employee, subject to available resources in the fund and the division's15 prioritization, from the fund to the employee.16 SECTION 7. In Colorado Revised Statutes, amend 8-4-120 as17 follows:18 8-4-120. Discrimination and retaliation prohibited - employee19 protections - criminal penalties - civil remedies. (1) An employer, OR20 ANY OTHER PERSON THAT IS REGULARLY ENGAGED IN BUSINESS OR21 COMMERCIAL ACTIVITY THAT HAS CONTRACTED WITH AN EMPLOYER OR22 WORKER, DIRECTLY OR INDIRECTLY, FOR LABOR FROM WHICH SUCH23 PERSON IS THE BENEFICIARY, shall not intimidate, threaten, restrain,24 coerce, blacklist, discharge, or in any manner discriminate or retaliate25 against any AN employee OR WORKER who has:26 (a) Filed any A complaint or instituted or caused to be instituted27 1001 -10- any A proceeding under this article 4 or any other law or rule related to1 wages, hours, or employment of minors; or2 (b) Testified or provided other evidence, or may testify or provide3 other evidence, in any A proceeding on behalf of the employee or another4 person regarding afforded protections under this article 4 or under any5 other law or rule related to wages, or hours, OR THE EMPLOYMENT OF6 MINORS; OR7 (c) R AISED CONCERNS IN GOOD FAITH ABOUT COMPLIANCE WITH8 OR OTHERWISE PROVIDED INFORMATION AS TO LEGAL RIGHTS AND9 REMEDIES AVAILABLE UNDER THIS ARTICLE 4 OR ANY OTHER LAW OR RULE10 RELATED TO WAGES OR HOURS TO ANY PERSON .11 (2) An employer who A PERSON THAT violates this section12 commits a class 2 misdemeanor.13 (3) (a) An employee OR WORKER who alleges a violation of14 subsection (1) of this section may file a civil action in a court of15 competent jurisdiction against the employer alleged to have violated this16 section to seek legal and equitable relief as appropriate to remedy the17 violation, including:18 (I) Back pay;19 (II) Reinstatement of employment or, if reinstatement is not20 feasible, front pay;21 (III) The payment of wages unlawfully withheld;22 (IV) Interest on unpaid wages at a rate of twelve percent per23 annum from the date the wages were first due;24 (V) The payment of a penalty of fifty dollars per day for each25 employee whose rights under this section were violated and for each day26 that the violation occurred or continued;27 1001 -11- (VI) Liquidated damages in an amount equal to the greater of two1 times the amount of the unpaid wages OR OTHER LOST PAY OR2 COMPENSATION or two thousand dollars; and 3 (VII) Injunctive relief; AND4 (VIII) C OMPENSATORY DAMAGES FOR OTHER ECONOMIC OR5 NONECONOMIC LOSS OR INJURY SHOWN BY COMPETENT EVIDENCE .6 (b) If the employee AN AGGRIEVED PERSON prevails in a civil7 action brought pursuant to this subsection (3), the court shall award the8 employee PERSON reasonable attorney fees and costs.9 (c) (I) I N DETERMINING WHETHER THERE HAS BEEN RETALIATION10 AS PROHIBITED IN SUBSECTION (1) OF THIS SECTION, A FACT FINDER SHALL11 CONSIDER THE TIME BETWEEN AN INDIVIDUAL 'S EXERCISE OF A PROTECTED12 ACTIVITY AND AN EMPLOYER'S ADVERSE ACTION. A PERIOD OF NINETY OR13 FEWER DAYS BETWEEN THE EXERCISE OF A PROTECTED ACTIVITY AND THE14 ADVERSE ACTION MAY , WITHOUT MORE , BE SUFFICIENT TO FIND15 RETALIATORY INTENT. ADVERSE ACTION OCCURRING MORE THAN NINETY16 DAYS AFTER THE EXERCISE OF A PROTECTED ACTIVITY MAY ALSO17 CONSTITUTE RETALIATION.18 (II) ANY EFFORT TO USE AN INDIVIDUAL'S IMMIGRATION STATUS 19 TO IN ANY MANNER DISCRIMINATE OR RETALIATE AGAINST AN EMPLOYEE20 OR WORKER WHO HAS ENGAGED IN ACTIVITY DESCRIBED IN SUBSECTION21 (1) OF THIS SECTION IS A VIOLATION OF THIS SECTION.22 (4) The division may investigate and enforce discrimination or23 retaliation prohibited by this article 4 or article 6 of this title 8 and, after24 investigation, may order the relief specified in subsection (3)(a) of this25 section AND REASONABLE ATTORNEY FEES AND COSTS .26 SECTION 8. Appropriation. For the 2025-26 state fiscal year,27 1001 -12- $208,979 is appropriated to the department of labor and employment for1 use by the division of labor standards and statistics. This appropriation is2 from the general fund and is based on an assumption that the division will3 require an additional 1.8 FTE. To implement this act, the division may4 use this appropriation for program costs related to labor standards.5 SECTION 9. Act subject to petition - effective date -6 applicability. (1) This act takes effect at 12:01 a.m. on the day following7 the expiration of the ninety-day period after final adjournment of the8 general assembly; except that, if a referendum petition is filed pursuant9 to section 1 (3) of article V of the state constitution against this act or an10 item, section, or part of this act within such period, then the act, item,11 section, or part will not take effect unless approved by the people at the12 general election to be held in November 2026 and, in such case, will take13 effect on the date of the official declaration of the vote thereon by the14 governor.15 (2) This act applies to conduct occurring on or after the applicable16 effective date of this act.17 1001 -13-