Wage and Overtime

Wage And Overtime Matters

Every employer is required to follow statutes and regulations under both federal and state laws that govern the payment of wages and overtime. The main laws governing Colorado employers are the Fair Labor Standards Act (“FLSA”), Colorado Wage Order No. 31, and the Colorado Wage Act. These laws are complex and their application often depends on the unique circumstances of the employer and employee. An experienced FLSA and Colorado wage and hour attorney can help determine if an employer’s wage practices comply with the law. 

Experienced Denver Overtime and Wage and Hour Law Attorneys

Baird Quinn’s FLSA and wage and hour attorneys have extensive experience navigating the complex landscape of the FLSA, Colorado Minimum Wage Order No. 34 and Colorado Wage Act. We can assist you with overtime or wage and hour issues, including:

  • Understanding the requirements of the FLSA, Colorado Minimum Wage Order and Colorado Wage Act
  • Determining whether employees are exempt from coverage because they are covered by the professional, managerial, administrative or other applicable exemptions
  • Counting work hours for compensation purposes under the FLSA or Colorado Wage Order No. 34
  • Calculating overtime compensation
  • Analyzing FLSA and state law issues in specific industries, such as the restaurant and auto industries
  • Auditing wage and hour practices to avoid significant potential liability under the FLSA and Colorado state laws

Our FLSA and wage and hour attorneys offer compliance assistance and regularly represent clients in administrative and court litigation under the FLSA, Colorado Minimum Wage Order and Colorado Wage Act. Baird Quinn’s wage and hour law and overtime violations representation extends to clients throughout Denver and elsewhere in the State of Colorado, as well as across the country. Please feel free to contact us for a confidential consultation regarding your wage and hour matter. Contact Us

Fair Labor Standards Act

Under the FLSA, virtually all employers must pay most employees a minimum wage, pay overtime compensation at one and one-half times the regular hourly rate to employees who work over 40 hours in a workweek, and pay all employees the same wage without regard to race, national origin, gender and other protected characteristics. You may find a more detailed summary of the FLSA at the following link. FLSA Overview

The following are recurring FLSA issues leading to court litigation or agency action with significant potential FLSA liability: 

1. Understanding the Exemption Status of Employees. 

Employers must pay overtime compensation to “non-exempt” employees. Employers are not required to pay overtime compensation to “exempt” employees, such as executives, professionals, certain administrative employees, some computer specialists, farm employees, and apprentices. These exemptions are narrowly interpreted by the Department of Labor. Employers often face significant liability due to their misapplication or other failure to follow the exemptions from coverage under the FLSA. 

The FLSA exemptions for executives, administrative, and professional employees – as well as other FLSA exemptions — are discussed in more detail on the following page. FLSA White Collar Exemptions

2. Misclassifying an Employee as an Independent Contractor

Colorado law delineates a fine line between independent contractors and employees in different ways for different purposes. For example, whether a worker is an employee or an independent contractor may differ in the context of unemployment insurance, payroll taxes, and workers’ compensation. The requirements also differ from state to state. Employers who misclassify workers as independent contractors face stiff potential penalties under numerous laws including the FLSA, Accordable Care Act, and Colorado Misclassification of Employees as Independent Contractors Act. As a misclassification may also lead to the denial of multiple employment benefits to workers (such as minimum wage, overtime, health insurance, 401(k) benefits), it may also be actionable in a private individual or class action against the employer. As a result, it is critical that employers properly classify employees as employees or independent contractors to avoid significant potential liability under a variety of state and federal laws. 

You may find additional information about independent contractor classification issues at this link. See Independent Contractor Classification Issues

3. Failing to Pay for “Off the Clock” Time 

Employers often face potential FLSA liability for failing to pay employees for “off the clock” time at work. Some employees clock in and begin work before their scheduled shift start time. In these situations, their employers may adjust the start time automatically to the scheduled time when calculating work hours. Alternatively, employers may adjust the clock-out time if employees work past the scheduled end of their shift. Whether accomplished through manual or automated adjustments to the time-keeping system, these practices deprive employees of pay for hours worked and normally violate the FLSA and Colorado Wage Order No. 31. 

Employers may also improperly classify certain time at the office or plant as “non-compensable time” and advise employees that they may not clock in or report work time until these tasks are completed. Common examples involve employees turning on their computers, putting on uniforms, or getting equipment needed for work. These practices are also problematic under the FLSA and have been subject to many class actions under the FLSA.

Employees who work more five (5) hours per day are entitled to an uncompensated meal period of at least thirty minutes. Employees are typically required to clock out and back in for the 30-minute meal period. However, many employees are not provided a 30 minute or longer meal period, but the employer may nonetheless require them to clock out or have implemented a time-keeping system to automatically deduct the time. The consequence is that employees are not compensated for “work hours” under the FLSA and Colorado law. While these practices may seem minor, they can lead to significant liability under the FLSA. 

4. The Myth of “Comp” Time 

Sometimes employers seek to avoid overtime by granting employees other benefits, such as “compensatory time” instead of cash for overtime hours worked, or “averaging hours” from week to week, or similar wage and hour practices. Even if requested or agreed to by the employee, however, the FLSA does not allow private employers to give employees compensatory time in lieu of pay at the overtime rate for overtime hours worked or move hours around between weeks or pay periods to reduce potential overtime liability. These practices violate the FLSA and may lead to significant FLSA liability. 

5. Other Excuses for Not Making Payment as Required by the FLSA

Employers also sometimes do not pay any wages at all, claiming that they do not have the money or that the employee has lost his or her right to be paid for some other reason. This violates Colorado state law and may also violate the minimum wage provisions of the FLSA. In other cases, employers do not pay full wages to employees or pay below minimum wage when the wages for the week are averaged. This is almost always an illegal wage violation under the FLSA.

It does not matter if an employee agreed to work for less than minimum wage or for free: employees cannot waive their rights under the FLSA. Even if an employer strikes a “deal” with an employee – which purports to excuse the employer from paying overtime or even wages to the employee – the employer still has to pay wages at the statutory rate. The FLSA does not allow employers to enter into such agreements with employees because it would be so easy for an employer to just claim “he just wanted to work a little more for free.” If the employer allows an employee to work, it then has to pay the employee for the work performed. 

6. Remedies under the FLSA

Under the FLSA, employees may file a private suit against their employer for unpaid overtime or minimum wage violations. The FLSA imposes penalties on those employers who improperly classify their employees as “exempt.” Congress intended the FLSA’s remedies to deter violations as well as to compensate employees for underpaid work and consequently, depending on the violation involved, provide both “liquidated damages” and criminal penalties.

Violations of minimum wage and overtime payment requirements of the FLSA can lead to substantial recoveries for underpaid or unpaid employees. Employees are entitled to be properly paid for every hour worked, and under the FLSA’s liquidated damages provision, wage differentials are almost always doubled to compensate the employee for violations. Finally, prevailing employees are entitled to recover their reasonable attorney’s fees and costs, so that the employer, not the employee, pays for the employee’s legal services.

Colorado Minimum Wage Order No. 34

Colorado Minimum Wage Order No. 34 (7 CCR § 1103-1), effective January 1, 2015, regulates, wages, hours, working conditions, and procedures for certain employers in Colorado. The Colorado Minimum Wage Order broadly applies to private sector employers and employees in the following four (4) industries:

  • Retail and Service
  • Commercial Support Service
  • Food and Beverage
  • Health and Medical

The Colorado Minimum Wage Order sets forth the Colorado minimum wage as well as allowable credits and exemption from the minimum wage requirements. See 2018-Minimum-Wage-Order.

The Colorado Minimum Wage Order also regulates the wage treatment of tipped employees, with provisions requiring a minimum wage that must be paid exclusive of tips, regulations for tip sharing, and the deduction of credit card processing fees from tipped employees’ income. While Colorado law permits employers to pay a lower minimum wage to tipped employees, it also requires that the employer follow certain conditions to qualify for the “tip credit.” The Colorado Wage Order No. 31 also regulates how tips are paid and distributed. 

Under Colorado Minimum Wage Order No. 34, employers must pay non-exempt employees at the rate of time and one-half their regular rate of pay for any work in excess of forty (40) hours per workweek, twelve (12) hours per work day, and twelve (12) consecutive hours worked without regard to the start and end time of their work day. Certain positions are exempt from the overtime requirements, including salespersons; parts persons and mechanics employed by automobile, truck, or farm implement dealers; certain commissioned salespersons in retail and service; certain ski industry employees, and certain medical transportation employees. 

The Colorado Minimum Wage Order also provides that employees are entitled to an uninterrupted and duty-free thirty (30) minute unpaid meal period when their work shift exceeds five (5) consecutive hours. If these conditions are not met, then the employee must be allowed to consume a meal on-duty, and be compensated for the entire on-duty meal period. 

Employees are also entitled to a compensated ten (10) minute rest period for each four (4) hours of work. It is not required that the employee be permitted to leave the premises for the rest period. 

The Colorado Division of Labor enforces the provisions of the Colorado Minimum Wage Order. Any person may file a written complaint with the Division regarding alleged violations of the Minimum Wage Order. Complaints must be filed within two (2) years of the alleged violation, except that all actions brought for willful violations must be commenced within three (3) years after the cause of action. 

Employers covered by the Wage Order must display a Wage Order poster in an area frequented by employees during the work day. 

Colorado Wage Act

The Colorado Wage Act requires Colorado employers to pay employees their earned wages in a timely manner. Generally, if an employer ends the employment relationship, an employee’s wages must be paid no later than twenty-four (24) hours after the end of the employment relationship (except for commissions). If an employee ends the employment relationship, the employee must be paid no later than the next regularly scheduled pay day. 

The Colorado Wage Act also regulates deductions from wages, vacation pay, commissions, bonuses, final pay, pay periods and paydays, and pay statements. The Colorado Wage Act is covered in detail at the following link. See Colorado Wage Act 

Employers are prohibited from retaliating against employees for pursing claims or exercising their rights under the Colorado Wage Act. In the event an employee is discharged for seeking payment of agreed upon wages or otherwise pursing a claim under the Colorado Wage Act, the employee may have an actionable wrongful discharge or retaliation claim against the employer. Contact Us 

Experienced Denver Overtime, Minimum Wages and Colorado Wage Act Lawyers

Baird Quinn’s Colorado FLSA lawyers have substantial experience handling FLSA and other wage and hour issues.

In addition to representing clients on cases involving nonpayment of overtime, Baird Quinn also has substantial experience representing clients in cases involving:

  • Alleged refusal to pay minimum wages;
  • Alleged failure to pay for all overtime worked or payments at less than the required amount;
  • Alleged payments with goods or services instead of money;
  • Alleged failure to pay commissions for sales made during the employment relationship.
  • Alleged failure to pay bonuses or other forms of incentive compensation.

If you would like additional information regarding our Denver wage and hour lawyers, please go to the following link. Contact Us