Changes Include No More 'Use-It-Or-Lose-It' Policies; Guidance on Pay Rate for HFWA Leave; Clarity on Missed Rest Period Penalty; and New Rules for Agricultural Employers
The Colorado Department of Labor and Employment (CDLE) has adopted new rules, effective Jan. 1, 2022, pertaining to overtime and minimum pay, adjusted labor compensation and wage protection.
These changes, adopted Nov. 10, 2021, include Colorado Overtime and Minimum Pay Standards (COMPS) Order #38; 2022 Publication and Yearly Calculation of Adjusted Labor Compensation (2022 PAY CALC) Order; and updated Wage Protection Rules. Here are some key takeaways for employers:
Under the Colorado Wage Act, vacation pay is considered wages, and unused vacation pay must be paid to employees upon separation. In recent years, there was some confusion about whether and when an employee’s unused vacation pay could be forfeited. However, this is now clear – once vacation pay is accrued it cannot be forfeited.
In June 2021, the Colorado Supreme Court in Nieto v. Clark’s Market, Inc., 2021 CO 48, issued a decision prohibiting “use-it-or-lose-it” vacation policies. The court made clear that all “earned” and “determinable” vacation pay must be paid to employees upon separation and was non-forfeitable. Any agreement that purports to forfeit earned vacation pay is void. While the court addressed “vacation” pay, the new CDLE rules and the definition of “vacation...
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