Equal Pay for Equal Work Act – New Colorado Law Effective Jan. 1, 2021

Posted by: Karen Booher on October 22nd, 2020

Colorado’s Equal Pay for Equal Work Act (EPEWA) goes into effect on Jan. 1, 2021. The new law applies to all employers in the state and has provisions on pay equity, pay history, and pay transparency.

New Employer Requirements and Prohibitions

• Employers cannot seek the wage rate history of job applicants or rely on a prior pay rate or salary to determine a current pay rate or salary.
• Employers are prohibited from discriminating or retaliating against a job applicant for failing to disclose their pay rate or salary history.
• Employers cannot prohibit employees from disclosing their wage information.
• Employers are required to make reasonable efforts to inform/announce to their current employees all opportunities for promotion, including the pay range for the job openings, on the same calendar day.
• Employers are required to maintain records of job descriptions and wage rate histories for each employee while employed, and for two years after employment ends.

Exceptions to Prohibiting Wage Differentials

The new law protects against discrimination because of sex, including gender identity, or sex in combination with another protected status. It is illegal for employers to pay an employee of one sex less than an employee of another sex for substantially similar work. However, an employer can avoid legal liability under the new law if they demonstrate that the entire wage differential is based on one or more of the following:

• A seniority system
• A merit system
• A system that measures earnings by production quantity or quality
• The geographic location where the work is performed
• Education, training, or experience relevant to the work in question
• Travel, if the travel is a regular and necessary condition of the work performed

How to Start Preparing for Compliance

To prepare for this new law, Colorado employers need to ensure that all employee pay records are in order, and they should review and revise job descriptions as needed. Employers should also conduct internal pay equity audits and remedy any discrepancies. Educating and training your company’s supervisors and hiring managers on this new law will also be crucial.

Most importantly, companies should be consulting with legal experts in employment law to ensure they are set up for compliance. As with all laws, employees alleging a violation of the EPEWA have the right to file complaints and/or lawsuits, and employers who fail to comply with the new law subject themselves to potential penalties, recovery of back wages by their employees, liquidated damages, and attorneys’ fees.

This blog is not meant to be a comprehensive article about the Equal Pay for Equal Work Act. J. Kent Staffing recommends that all employers consult with legal professionals to ensure they are abiding by this new Colorado law.

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Sources:

1. ASA Staffing Today, 10/12/2020, JDSupra (10/05/20), referencing article by Faegre Drinker Biddle & Reath LLP, “Colorado Employers: Prepare to Comply With Equal Pay for Equal Work Act Taking Effect January 1, 2021”.
2. “Colorado Enacts Comprehensive Equal Pay Law”, by Laura A. Mitchel and Scott M. Pechaitis, JacksonLewis, May 28, 2019.