Employers struggle to comply with Colorado’s new equal pay for equal work law

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Five months after Colorado’s new equal pay for equal work law came into effect, employers are still struggling to understand and comply with this law and related guidelines. The display requirements for promotions and compensation are two particularly difficult areas to understand.

Promotional display conditions

As a general rule, employers should internally post all promotion opportunities to current employees on the same day and sufficiently in advance of the promotion decision that employees can apply for. A promotion opportunity exists when an employer has or anticipates a vacant position in a new or existing position that could be considered a promotion for any employee in terms of pay, benefits, status, duties or access to advancement. Promotional posting should be in writing, with job title, compensation, benefits, and how employees can apply. The employer cannot limit the posting to those it deems qualified, but can declare that applications are only open to those who have certain qualifications, and employers can select or reject applicants based on these qualifications.

There are a few very limited exceptions to the promotional display requirements, including: (1) for reasons of confidentiality when the holder does not know they are separated; (2) there is an automatic promotion after a trial period within one year on the basis of a written statement; (3) temporary posts of less than six months; and (4) employees outside of Colorado do not need to be notified of promotional opportunities.

This has raised some interesting scenarios regarding what constitutes “promotional opportunities” that must be posted under current Colorado Department of Labor rules and guidelines on the law. For example, a post available to all current Colorado employees at a university must be made before a professor is transferred from a non-permanent position to a permanent position, even though that professor will be the only qualified candidate for that position. . Additionally, all Colorado employees for a large multi-state corporation, including entry-level employees, should be made aware of an available CFO position in New York City. Of course, it doesn’t make sense for employers to have to post internally in these scenarios, but it seems to be what current guidelines require.

Remuneration display conditions

All job postings, both internal and external, must include hourly or salary compensation (or salary scale) and a general description of all compensation and benefits offered. Employers should include the following compensation and benefits information in each posting: (1) hourly rate or salary (or scale); (2) a general description of all bonuses, commissions or other forms of remuneration; and (3) a general description of the fringe benefits, including health care, retirement, paid days off (sick leave, parental leave, paid leave, vacation) and any other benefits to be declared for the purposes of the federal tax, but not minor benefits.

A range of pay may extend from the lowest salary to the highest salary that the employer in good faith believes he can pay for the job in question. Employers may then deviate from the posted salary range as long as it is a reasonable and good faith estimate of the possible salary range at the time of posting.

It is important to note that employers are not required to post any job vacancies outside before hiring. But if an employer decides to advertise a job outside, they must include compensation information. In addition, the compensation posting requirements do not apply to work performed entirely outside Colorado or to postings performed entirely outside Colorado. However, remote job postings and online postings must include compensation.

Pending case contesting the conditions for posting promotions and remunerations

The Rocky Mountain Association of Recruiters (“RMAR”) filed a lawsuit against the Colorado Department of Labor in the United States District Court for the District of Colorado in December 2020, seeking an injunction to prevent the application of promotion requirements. and remuneration. RMAR argued that the promotional and compensation display requirements violate the Commerce Clause, the Dormant Commerce Clause, and the First Amendment to the United States Constitution. US District Judge William J. Martinez is presiding over this case and heard oral argument on April 21, 2021. On April 26, 2021, the judge asked the parties to submit additional briefs on several issues. We are following this case closely and will update our article with the result.

Updated May 27, 2021: Today, U.S. District Judge Martinez dismissed RMAR’s motion for a preliminary injunction, ruling that RMAR had failed to demonstrate a likelihood of success on the merits of its Dormant Commerce Clause and First Amendment claims. The court underscored the importance and substantial government interest in closing the gender pay gap in Colorado. The court also noted that RMAR, at this early stage of the litigation, had failed to establish that the burdens on interstate commerce exceeded local benefits. Further, the Court found that the Department of Labor had sufficiently demonstrated that the promotion and compensation requirements were reasonably linked to a substantial government interest and did not impose an undue burden on employers. With this current ruling, posting promotion and compensation requirements under Colorado’s Equal Pay for Equal Work Act will continue to apply. However, RMAR can appeal the order or continue to argue the case. We will continue to monitor this matter and update this blog with other important developments.

Originally posted May 11, 2021

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.

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