Colorado Releases Pay Transparency Rules

The Colorado Department of Labor Employment (CDLE) has issued the highly anticipated final equal pay transparency rules and the statement of basis, purpose, specific statutory authority and findings, which seek to clarify the Colorado Ensure Equal Pay for Equal Work Act. The rules, which are largely unchanged from their proposed version, will become effective on Jan. 1, 2024.

Colorado employers must announce, post or otherwise make known all job opportunities. The CDLE will release further guidance, which the CDLE website says is "coming soon."

What’s Not Included

The new rules create definitions for "career developments" and "career progressions," which are excluded from the notice obligation.

The law defines career development as a "change to an employee's terms of compensation, benefits, full-time or part-time status, duties, or access to further advancement in order to update the employee's job title or compensate the employee to reflect work performed or contributions already made by the employee." The new rules clarify that such existing work or contributions must be part of the employee's existing job and are not within a position with a current or anticipated vacancy. Employers are not required to send notices of career development position changes.

Similarly, job changes due to career progressions, defined as "regular or automatic movement from one position to another based on time in a specific role or other objective metrics," are carved out from the definition of job opportunity. However, for these positions, employers must disclose and make available to all eligible employees the requirements for career progression, along with each position's terms of compensation, benefits, full-time or part-time status, duties, and access to further advancement.

Eligible employees are "those in the position that, when the requirements in the notice are satisfied, would move from their position to another position listed in the notice as a career progression."

Notice of Application Deadline and Candidate Selection

The law requires that job postings include the date the application window is anticipated to close. This created confusion about evergreen job postings (i.e., roles for which the employer accepts applications on an extended, ongoing basis), as well as how to comply when an application deadline is extended.

The rules clarify that, if there is no deadline because the employer accepts applications on an ongoing basis, the posting must say so, and a deadline is not required. A deadline may be extended, as long as the original deadline was a good-faith estimate of what the deadline would be, and the posting is promptly updated when the deadline is extended.

The rules note that employers need not provide notice of acting, interim or temporary positions lasting for up to nine months where the hiring is not expected to be permanent.

After a candidate is selected for a job, the law requires employers to distribute a post-selection notice to "employees with whom the employer intends the selected candidate to regularly work." Under the new rules, the term work with regularly means employees who collaborate or communicate about their work at least monthly or have a reporting relationship. Employees entirely outside of Colorado are not entitled to this post-selection notice.

Employers may comply by providing the post-selection notice of each individual selection or multiple selections, as long as the notice is provided no later than 30 days after any selection in the notice.

In response to concerns raised by victims' advocate groups, the rules provide a limited right to non-disclosure for employees. Employers are prohibited from disclosing a selected candidate's name or prior job title if:

• Any applicable law, such as a restraining order, requires not disclosing those items.
• A selected candidate voluntarily informs the employer in writing without pressure or coercion that they believe disclosure of those items would put their health or safety at risk.
  

Employers are still required to provide all other required post-selection information, even if it does not disclose the candidate's name or prior job title.

The new rules establish that the notice requirements for pre-selection, post-selection and career progression do not apply to employees entirely outside Colorado. The compensation and benefits disclosure requirements do not apply to postings for jobs to be performed entirely outside Colorado or physically located entirely outside Colorado.

The CDLE is expected to release its interpretive notice in the coming weeks. Historically, this sub-regulatory guidance has filled in the gaps and provided more details and examples of how the state expects employers to comply.

Laura Mitchell, Christopher Patrick, Scott Pechaitis and Nicholas Santucci are attorneys with Jackson Lewis in Denver. © 2023. All rights reserved. Reprinted with permission.