Colorado’s SB 22-161 took effect January 1, 2023, with increased penalties for wage theft and the late payment of wages. Key updates and modifications pertaining to the payment of wages and state enforcement procedures are as follows:

• Changes the penalties for failure to provide requested information to the division of labor standards and statistics in the department of labor and employment (DLSS) or hindering/obstructing the DLSS or other person authorized in accessing an employer’s premises from a misdemeanor criminal offense to a daily penalty of not less than $50.
• Requires an employer to:
  • Provide notice to an employee, within 10 days after the employment terminates, before deducting from wages or compensation any amount of money or property the employee failed to return or repay upon termination of employment; and
  • Pay the employee the deducted amount within 14 days after the employee returns or repays the money or property if the employee did so within 14 days after notice is provided.
• Imposes automatic penalties of the greater of 2 times the amount of the unpaid wages or $1,000 on an employer that fails to pay all past-due wages within 14 days after a written demand or civil or administrative action for the past-due wages is sent to or served on the employer.
  • If the failure is shown to be willful, the employer is subject to penalties equal to the greater of 3 times the amount of unpaid wages or $3,000.
  • Makes a second or subsequent failure/refusal to pay wages of the same or similar type within the 5 years preceding a claim is considered per se willful.
• Requires an employee to dismiss their claim if an employer makes a full legal tender of all amounts demanded in good faith within 14 days after a written demand, administrative claim or civil action is sent or served.
• Allows recovery of attorney fees, an additional fine of 50% of the amount of past-due wages, and a penalty of the greater of 50% of past-due wages or $3,000 from an employer that fails to pay an employee past-due wages within 60 days after the determination in favor of the employee.

SB 22-161 also adds additional enforcement concerning the awarding of attorney’s fees, certified filings, administrative liens/levy’s and civil action relief (e.g., back pay, reinstatement or front pay).

Employers seeking to avoid liability for potential wage and hour violations should consider initiating quarterly or annual internal audits of current wage and hour practices. Early detection of wage and hour issues will help mitigate the impacts of any potential costly mistakes.