Colorado’s new Equal Pay for Equal Work law is supposed to create transparency when it comes to employees’ pay to make sure there are no disparities when it comes to women and people of color.

But so far, it has served to cloud the issue when it comes to posting requirements, some hires, raises and promotions, according to employment lawyers, company officials and at least one chamber president.

“The posting requirement probably has caused the most heartburn of anything in the statue,” said

Brett Painter, a partner specializing in employment and labor law with David Graham & Stubbs LLP.

Painter’s comments came recently during a Denver Metro Chamber of Commerce webinar on the topic. The South Metro Denver Chamber also fielded many questions on the topic at its economic forecast event recently.

The Legislature passed the measure in 2019 and it took effect Jan. 1.

“It basically solves a problem that didn’t exist, from our point of view,” said Jim Noon, owner of Centennial Container in Denver. “One of the complaints I’ve heard is it takes the flexibility out.”

The Colorado Department of Labor and Employment (CDLE) is charged with enforcing the new rules.

Scott Moss, director of the CDLE’s Division of Labor Standards and Statistics, said its educational efforts have included the department posting notices on its website, publishing guidance sheets, sending emails to as many employers as it had on file and it will host an upcoming webinar on the topic.

“We’ve had a number of calls, but it’s about on par when any new law is passed,” Moss said.

Several questioned aloud if, during a pandemic when unemployment rates are soaring in the state, it’s the best time to be strictly enforcing a law that might hinder an employer’s ability to hire or retain employees.

“If this doesn’t help get a job, keep a job or advance a job – let’s do it later,” said Denver Chamber’s CEO Kelly Brough. “Job one should be to get everyone back to work, because the consequences to families will be immeasurable and heartbreaking.”

As employers are working to get people to work, they shouldn’t have the extra burden and cost of hiring employment lawyers and human resources specialists to navigate new regulations, she said.

“Some employers might decide it’s too complicated to get into the Colorado market,” Brough said of possible “unintended consequences.”

No more raises or promotions without informing all

 “Anything that constitutes as promotional opportunity to an employee must be posted and made available to all employees, whether or not they’re qualified,” said Martine Wells, shareholder and employment lawyer with Brownstein Hyatt Farber Schreck, at the Chamber webinar.

So while some bosses might have preferred to keep salary information private – that’s now illegal.

“You don’t have to post that publicly, just within the company,” Moss said. “The law might serve its purpose there. Some complaints, most of them actually, are that the statue has shifted the balance towards more transparency … some prefer to keep pay confidential in a world with a lot of disparity in pay.”

Painter describes the more nuanced difficulty employers are having with that particular provision.

“Historically, programs have allowed employees to come up through the ranks – which is an incentive for the employee and provides upward mobility,” Painter said. “The boss knows the incumbent, knows the incumbent’s skill set and the expectations are they move through the ranks. That process doesn’t necessarily contemplate making it known to the rest of the employee population.”

Now employers must be careful to fully disclose all potential raises, promotions and time periods when a position is created. That’s the loss of flexibility Noon mentioned.

“An employee came up to me last week and said they were having some personal issues and asked for $1 raise,” Noon said. “I had to say ‘I’m sorry I can’t do that for you, because it’s not part of a pre-laid out schedule for your job.”

Noon pointed to another example of when a person, woman ironically enough, walked into the Container store and pitched herself as a saleswoman. He was so impressed, he hired her on the spot.

“Now that would be illegal,” he said.

Not really, Moss countered.

“You can still hire without a public posting, you can still do that,” Moss said. “All the law says is about including a pay range. If you do publish a post, you have to include a pay range and a general description of benefits. The vast majority of listings we’ve seen have complied with that.”

But what about just a tweet or Facebook post about the job?

Moss said as long as there’s a link to a fuller job description, it complies.

“I’d be surprised if that discouraged any hiring,” he said.

There’s also confusion about companies that are located elsewhere but have many Colorado employees. Do they have to publish promotional opportunities to every employee nationwide?

“The statute requires you post that to all Colorado employees,” Painter said. “The problem is that we don’t work in a place anymore – we work out of our homes. What if there’s a position in Texas that a Colorado employee can do remotely?”

Brough used the extreme example of having to reveal a potential salary when looking nationwide for a candidate.

“Let’s say the Denver Broncos want to hire a new quarterback? Do they have to post that job with salary” undermining player negotiations with competing teams, Brough asked.

Morris said employers are always encouraged to call the department if they have questions about the new law.

“We’re not taking names for an investigation, really! We appreciate when employers call,” he said.

The Legislature allocated staff for those calls and enforcement efforts, so nothing is being drained from the department’s enormous strain on the unemployment insurance side. Moss also said there was a one-month grace period in January with no investigations. They’ve received some complaints about postings with no pay range and have done some checking on their own.

“Most employers are posting the expected pay and pay range, that’s all they have to do,” he said. “Ninety percent of our staff resources are devoted to providing guidance and clarity, not to enforce. But we will start investigating any complaints.”

Link to pdf of Equal Pay Transparency Rules ColoradoRegister (1).pdf

Link to pdf of Equal Pay for Equal Work Act Fact Sheet INFO #9_ Equal Pay Transparency Rules (2021).pdf (colorado.gov)

This article has been updated to correct when the Legislature passed the law.