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C OLORADO D IVISION OF L ABOR

633 17 th Street, Suite 200 Denver, CO 80202 www.colorado.gov/cdle/labor. C OLORADO D IVISION OF L ABOR. S TATE LABOR, EMPLOYMENT, AND IMMIGRATION LAWS UPDATE. February 25, 2010. C OLORADO DEPARTMENT OF LABOR & EMPLOYMENT. Executive Director. Division of Employment and Training.

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C OLORADO D IVISION OF L ABOR

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  1. 633 17th Street, Suite 200 Denver, CO 80202 www.colorado.gov/cdle/labor COLORADO DIVISIONOF LABOR STATE LABOR, EMPLOYMENT, AND IMMIGRATION LAWS UPDATE February 25, 2010

  2. COLORADODEPARTMENT OF LABOR & EMPLOYMENT ExecutiveDirector Division of Employment and Training Division of Workers’ Compensation Division of Labor Division of Oil & Public Safety Employment and Training Labor Market Information Unemployment Insurance Workforce Centers Claims Services Dispute Resolution Employer Services Medical Policy Research Medical Service Delivery Special Funds Technical Operations Wage and Hour Youth Employment Labor Relations Immigration Boiler Inspection Carnivals Explosives Oil Inspection Public Safety Office Public School Construction

  3. Presentation Content • Workplace Compliance Trends and Litigation Directions • State Wage and Hour Hot Topics • Minimum Wage • Wage Order Number 26 • Wage Act • State Immigration-Employment Laws • Employment Verification Law • E-Verify, Public Contracts for Services Law

  4. Litigation TrendsSource: Seyfarth Shaw 2010 Litigation Report • Downturn is likely to fuel more lawsuits...Former employees are a fertile source of suits and complaints to government agencies. • Wage and hour litigation / FLSA lawsuits outpace all other types of workplace class actions. • Top-ten wage and hour private settlements totaled over $360 million in 2010, $100 million greater than in 2009. • US DOL hired 250+ new W & H investigators in the U.S. • US DOL Denver announced yesterday a new enforcement initiative for restaurants and construction industries. (Denver Post)

  5. COLORADO MINIMUM WAGE In 2006, voters passed an amendment to the Colorado Constitution: Colorado Constitution, Article XVIII, Section 15 Effective January 1, 2007, Colorado's minimum wage shall be increased to $6.85 per hour and shall be adjusted annually for inflation, as measured by the Consumer Price Index used for Colorado. This minimum wage shall be paid to employees who receive the state or federal minimum wage. No more than $3.02 per hour in tip income may be used to offset the minimum wage of employees who regularly receive tips.

  6. COLORADO MINIMUM WAGE Date MW Tipped MW January 1, 2010 $7.24  $4.22 January 1, 2009  $7.28  $4.26  January 1, 2008  $7.02  $4.00  January 1, 2007  $6.85  $3.83  August 8, 1998  $5.15  $2.13

  7. COLORADO MINIMUM WAGE Minimum Wage, January 1, 2010 • Current Colorado minimum wage: $7.24 and tipped employee minimum wage: $4.22 • MW adjustment based on BLS data • DBG CPI-U Compares first half of 2008 to first half 2009 • Anticipated release of BLS data – August 2010 • Federal MW is $7.25, and federal tipped MW: $2.13 • CO MW lawsuit dismissed in Denver District Court

  8. MINIMUM WAGE ORDER NUMBER 26: COVERAGE • Retail and Service • Commercial Support Service • Food and Beverage • Health and Medical

  9. OVERTIME PAY Overtime: Wage Order 26 Time and one-half the regular rate of pay for any work in excess of: • 40 hours per workweek – like FLSA • 12 hours per workday (differs from FLSA) • 12 consecutive hours without regard to starting and ending time (differs from FLSA)

  10. MEAL AND REST PERIODS Meal and Rest Periods: Wage Order 26 Non-exempt employee is entitled to: • At least a ½ hour “duty-free” meal period if the scheduled work shift exceeds 5 consecutive hours. • Compensated 10 minute rest period in the middle of each four hour work period.

  11. TIP CREDIT Tip Credit: Wage Order 26 • Tip Credit - $3.02 credit against minimum wage for tipped employees • Tipped employee must customarily receive more than $30.00 a month in tips Nullification of Tip Credit: • Employer required sharing of tips with those who do not customarily receive tips • Employer deducts credit card processing fees

  12. WAGE ACT Wage Act Wages defined: All earned, vested, and determinable amounts for labor or service performed by employees regardless of method of calculation. • Hourly • Salary • Piece-rate • Commission • Bonus (non-discretionary) • Vacation (upon separation – earned in accordance with an agreement) • Severance and Sick Pay– not defined as wages

  13. DEDUCTIONS Permissible Deductions: Wage Act • Those required by local, state, or federal law • Per written agreement between the employer and employee for loans, pay advances, goods or services, and equipment or property • Deductions necessary to cover the replacement cost of a shortage due to theft by an employee • Deduction authorized by the employee and that can be revoked. (insurance benefits, savings plans) • Amount of money or the value of property that the employee failed to properly pay or return to the employer (termination only)

  14. FINAL PAY Final Pay: Wage Act • Employee Quits or Resigns • Wages due next regularly scheduled payday • Terminated Employee • Payroll onsite and open – wages due immediately • Payroll onsite and closed – wages due 6 hours after beginning of employer’s accounting unit’s next regular workday • Payroll offsite – wages due no later than 24 hours after the start of employer’s accounting unit’s next regular workday

  15. FINAL PAY Penalties Upon Demand: Wage Act • Upon demand, an employer has 14-days to pay amounts believed in good faith are due to employee • Increased penalties for failure to pay within 14 days of receipt of demand; Greater of: • Average daily earnings up to 10 days, OR • 125% of wages due up to $7,500, plus • 50% of wages due over $7,500

  16. TIMELY PAYMENT & PAY PERIODS Timely Payment and Pay Periods: Wage Act • An employer must pay on regularly scheduled paydays • Paydays cannot exceed 10 days following the close of a pay period • Pay periods cannot exceed a calendar month or 30 days

  17. WAGE ACT CHANGES Changes to the Wage Act in 2009 Additional fees for bounced paychecks:Three times the face amount of the check but not less than one hundred dollars AND actual damages caused by the nonpayment, including associated late fees. Paycards as a permissible form of payment (2008). Changes to the Wage Act in 2010, proposed legislation: None (at present).

  18. DIVISION ENFORCEMENT • 7,000+ annual complaints and written inquiries • Mediation process averages 35-45 days • Division is not an advocate for either party • Cannot guarantee payment or resolution • Cannot provide legal advice • Division recovers over $1.3 million per year

  19. ASSSORTED ENFORCEMENT • Employee cannot waive rights to earned wages • Division involvement • Criminal prosecution • Civil action • Federal law / US DOL

  20. www.colorado.gov/cdle/employmenteligibility HB 06S-1017 (8-2-122, C.R.S) COLORADO EMPLOYMENT VERIFICATION LAW

  21. IMMIGRATION LAWS Then: Immigrant Hiring Law Perplexing, Denver Post, 12/17/06 • Immigration dilemma, Rocky Mountain News, 12/12/06 • New law a head scratcher, Rocky Mountain News, 12/1/06 • Swift raids – 1,300 or 10% of entire workforce - nationwide • Iowa meatpacking raids – 300 from town of 2,500, Postville, Iowa • Possible federal preemption Now: Continuing education and enforcement You may recall the backdrop from 2007…

  22. 8-2-122, C.R.S. COVERAGE • Employers include both public and private employers. • The law applies to Colorado employees hired on and after January 1, 2007. • Within 20 days after hiring a new employee, the employer must have completed the employment eligibility verification process.

  23. EMPLOYMENT VERIFICATION LAW8-2-122, C.R.S. Each employer (includes private and public) in Colorado shall complete an affirmation within 20 days after hiring a new employee. The employer must keep for the term of employment of each employee: • a written or electronic copy of the affirmation • Written or electronic copies of employee’s identity documents required by 8 U.S.C. sec 1324 a (Form I-9)

  24. 8-2-122, C.R.S. AFFIRMATION • Has examined the new employee’s legal work status • Has retained file copies of documents required by 8 U.S.C. Sec. 1324a (copies of I-9 identity documents presented by the employee) • Has not altered or falsified the employee’s identification documents • Has not knowingly hired an unauthorized alien Employer must affirm within 20 days after hiring a new employee that the employer:

  25. Available on Division website: colorado.gov/cdle/employmenteligibility AFFIRMATION SAMPLE Any substantially similar affirmation may be used.

  26. 8-2-122, C.R.S. DOCUMENT RETENTION Employer shall keep a written or electronic copy of: • The signed affirmation • Copies of the employee’s identity documents produced to comply with I-9 Retain for each employee’s term of employment

  27. 8-2-122, C.R.S. ENFORCEMENT • When the Department has reason to believe that an employer has not complied, the Director shall request the employer to submit the documentation • The Division conducts random audits; commenced in October 2007 • The Department accepts written complaints and shall have the discretion to determine which complaints, if any, are to be investigated

  28. 8-2-122, C.R.S. ENFORCEMENT • 2,000+ total audits to-date • 1,700 randomly generated • Approximately 20 commenced each week/1,000 per year anticipated • Notified by letter • Must submit requested written materials • New Rules effective October 30, 2009

  29. 8-2-122 RANGE OF RESPONSES • No new employees post-1/1/07 • All documents in order • Business closed • Pending reply • No affirmations • Affirmations back-dated • No copies of identity documents • Identity documents do not reasonably appear to be genuine • No affirmations or copies of identity documents • No reply to multiple requests • Reckless Disregard: no documentation, false or fraudulent documentation

  30. 8-2-122, C.R.S. PENALTIES • An employer who, (1) with reckless disregard, fails to submit the required documentation (2) with reckless disregard, submits false or fraudulent documentation • May be subject to a fine • Up to $5,000 for the first offense • Up to $25,000 for the second and subsequent offenses

  31. 8-2-122, C.R.S. PENALTIES • Division has levied significant fines against numerous employers • Fines due to: • No response • Reckless disregard; failure to provide information • Repeated non-compliance

  32. E-Verify Free, voluntary except for some states, situations Mandatory for: federal contractors and Colorado public contracts for services Internet-based Newly hired only, no later than 3 days post-start date I-9 information submitted through SSA and DHS databases 97% are shown to be work-eligible TNC must contact SSA or DHS Must use for all new hires (cannot be selective)

  33. E-Verify • 2010 Proposed Legislation: SB 10-033 • Repeals the current employment verification law • Requires all private sector employers to use E-Verify • CO Attorney General can fine for noncompliance • Suspension of business license possible • Tancredo Proposed Initiative for November Election • E-Verify requirement for all CO employers • 76,047 signatures to get on ballot • U.S. Supreme Court and Preemption

  34. E-Verify Statistics from USCIS: 1/23/10 Federal • Total E-Verify enrollment nationally: 183,000 employer companies, 3.9 million queries Colorado • Colorado E-Verify enrollment: 5,690 Colorado employer companies (5,200 in 2009; 3,800 in 2008; 2,500 in 2007) • Number of queries in Colorado: 82,000 so far for FY 2010 (federal FY of Oct 1-Sept 30)

  35. E-Verify Statistics • Work authorization effective 7/9/2009 • 96.9% work authorized instantly or within 24 hours • .3% tentative non-confirmation ultimately resolved as work authorized • 2.8% not authorized Source: www.uscis.gov

  36. E-Verify Federal Directions DHS Homeland Security Secretary, 2010: “E-Verify is absolutely where we are going in terms of incentivizing employers and making sure we are using a legal work force” Mandatory use for all employers in the U.S. is considered a likely component of comprehensive immigration reform.

  37. RESOURCES Division Homepage:colorado.gov/cdle/labor Wage and Hour:colorado.gov/cdle/wagelaw Minimum Wage:colorado.gov/cdle/minimumwage Youth Law:colorado.gov/cdle/youthlaw Union Law:colorado.gov/cdle/laborrelations Immigration:colorado.gov/cdle/employmenteligibility Division e-mail: labor.stand@state.co.us Division phone: 303-318-8441

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