New Colorado Equal Pay Transparency Rules

On September 29, 2020, the Colorado Department of Labor and Employment (“CDLE”) issued proposed rules that would govern the enforcement and implementation of Colorado’s Equal Pay for Equal Work Act (the “Act”). The CDLE finalized the proposed rules, called the Equal Pay Transparency Rules (the “Adopted Rules”), on November 10, 2020 and they will go into effect on January 1, 2021. The Adopted Rules pertain to the provisions of the Act governing employer obligations to disclose and announce promotional opportunities to all employees. The Act, as well as the Adopted Rules apply to all Colorado employers, including Public School Districts and Charter Schools.

What is a Promotional Opportunity?

The Act requires employers to make “reasonable efforts” to announce, post, or otherwise make known all “opportunities for promotion” to all current employers on the same day. The adopted rules state that a “promotional opportunity” exists when an employer “has or anticipates a vacancy in an existing or new position that could be considered a promotion for one or more employees in terms of compensation, benefits, status, duties, or access to further advancement.” The term “vacancy” implies that an employer is not obligated to announce promotional opportunities for “in line” advancements due to the needs of the employer or the simple passage of time, rather than as recognition from the employer. It is unclear whether the CDLE intends for the Adopted Rules to apply to all promotional opportunities, or only those opportunities in which there is a vacancy.

Which Employees Must be Given Notice?

The Adopted Rules still require employers to notify all employees of promotional opportunities, and employers may not limit notice to only those employees that it deems “qualified.” However, employers may choose to notify employees that applications are only open to employees that meet certain qualifications.  

Exceptions to Notification Requirements

The Adopted Rules create an exception for employers to not post or publish a promotional opportunity to all employees if the employer has a “compelling need” to keep the opening confidential because the incumbent employee is unaware that he or she will be terminated. If an employer still elects to notify any employees of the opportunity, then all employees who either meet the minimum qualifications or have a job “substantially similar” to those employees being notified must be notified as well. If the need for confidentiality ends, then the employer must comply with the Adopted Rules in full.

The Adopted Rules create another exception when an employer makes a written representation to new employees that the employer will “automatically consider” the employee for a specific promotion based upon performance and/or employer needs, then the employer has no obligation to post such promotional opportunity to all other employees. 

Similarly, no notice is required to fill temporary positions for up to six months if the position is not expected to be permanent. If the position may become permanent, then the employer must make a posting in time for employees to apply.

Geographic Applicability

The Adopted Rules simplify geographic requirements by stating that posting requirements do not apply to employees entirely outside Colorado. Additionally, the compensation posting requirements of the Act do not apply to jobs to be performed entirely outside of Colorado or postings entirely outside of Colorado.

Summary 

The Adopted Rules impose significant obligations for employers to post and publish promotional opportunities in a timely manner. As state guidance changes, employers should continue to consult with legal counsel to ensure that they are complying with all applicable requirements.