With the new year quickly approaching, Colorado employers with 16 or more employees need to be prepared for the implementation of the paid sick leave (PSL) provisions of the Colorado Healthy Families and Workplaces Act (HFWA). Covered employers must provide employees with up to 48 hours of PSL a year. The COVID-19 related paid leave provisions of the HFWA began in July 2020 but expire December 31, 2020. As discussed below, beginning in 2021 the HFWA contains similar public health emergency provisions providing additional PSL for reasons related to self-isolation, caring for one’s self or a family member, and school and child care closures. The key provisions of the HFWA are addressed below.
This law is separate from the Colorado Paid Family and Medical Leave Insurance Act (opens a new window) (Proposition 118), which was recently passed by voters on November 3, 2020. An alert discussing the Colorado PFMLIA can be found here (opens a new window).
Which employers are covered by the HFWA?
Effective January 1, 2021, each employer with 16 or more employees shall provide each employee PSL. “Employer” includes “the state and its agencies or entities, counties, cities and counties, municipalities, school districts and any political subdivisions of the state.” When counting employees, the HFWA analysis is consistent with the FFCRA's Emergency Paid Sick Leave Act (opens a new window) which includes all full-time and part-time employees within the United States, employees on leave and employees in separate establishments or divisions of the business. By January 1, 2022, all Colorado employers regardless of size must provide each employee with PSL.
Lockton comment: With respect to the employee threshold, the HFWA applies to an employer with 16 or more employees within the United States. Thus, an employer with one employee in Colorado but 15 employees in other states is obligated to comply with the HFWA for the single Colorado employee.
An employer that provides “equivalent or more” paid leave under the terms of a collective bargaining agreement (CBA) is exempt from other HFWA requirements so long as the CBA provisions do not diminish an employee’s right to “equivalent” paid leave. Employees of the federal government and those covered by the federal Railroad Unemployment Insurance Act are not covered by the HFWA.
Under what circumstances must employees receive paid leave under the HFWA?
The following health-related and safety-related needs qualify for paid leave:
The employee’s own mental or physical illness, injury, or health condition that prevents the employee from working
The employee’s own need to obtain a medical diagnosis, care or treatment of a mental or physical illness, injury, or health condition or other preventive medical care
The employee’s need to care for a family member who has a mental or physical illness, injury or health condition; or who needs the care identified above in (2)
The employee or the employee’s family member has been the victim of domestic abuse, sexual assault or criminal harassment and needs leave to seek medical attention, obtain services from a victim services organization, obtain mental health or other counseling, seek relocation, or seek legal services
Due to a public health emergency, a public official has ordered closure of the employee’s place of business or the school or place of care of the employee’s child and the employee needs to be absent from work to care for the child.
A “family member” includes an employee’s immediate family member (related by blood, adoption, marriage or civil union) and a person for whom the employee is responsible for providing or arranging health-related or safety-related care.
An employer shall allow an employee to use PSL upon request. The request may be made orally, in writing, electronically or by any other means acceptable to the employer. When possible, the employee shall include the expected duration of the absence. An employer may provide a written policy that contains reasonable procedures for the employee to provide notice when the use of PSL taken is foreseeable; however, an employer shall not deny PSL to the employee based on noncompliance with such policy. PSL cannot be counted as an “absence” that may lead to firing or other disciplinary action.
When taking PSL is foreseeable, the employee shall make a good-faith effort to provide notice of the need for PSL to the employer in advance and shall make a reasonable effort to schedule the use of PSL in a manner that does not unduly disrupt the operation of the employer.
May an employer require documentation of the reason(s) for PSL?
The HFWA allows employers to require documentation of leave for a HFWA reason only when the leave is four or more consecutive days. Even then, an employer can only require “reasonable documentation” – enough to show a valid reason for the leave. The employer shall not require disclosure of details relating to the employee’s (or family member’s) HFWA-related health or safety information. Any health or safety information possessed by an employer regarding an employee’s HFWA leave must be kept confidential and in a file separate from other personnel information. Finally, documentation is not required to take PSL, but can be required as soon as the employee reasonably can provide it.
How much paid leave must employers provide?
Each employee earns at least one hour of PSL for every 30 hours worked except that an employee is not entitled to earn or use more than 48 hours of PSL each year unless the employer selects a higher limit. An employer satisfies the accrual requirements by frontloading 48 hours or more PSL at the beginning of the year. An employer can choose a faster or more generous accrual rate and can provide an employee with more than 48 hours of PSL a year. Note: PSL provided to an employee of a federal contractor as required by federal executive order 13706, “Establishing Paid Sick Leave for Federal Contractors,” is considered PSL provided under the HFWA.
Exempt employees accrue PSL on the assumption that the employee works 40 hours a week. If the employee works fewer than 40 hours per week, the employee accrues PSL based upon the number of hours that comprise the employee’s normal work week.
An employee begins to accrue PSL when employment begins and can use PSL as it is accrued. There is no waiting period. Up to 48 hours of PSL that an employee accrues in a year but does not use carries forward to and may be used in a subsequent year. An employer is not required to allow the employee to use more than 48 hours of PSL in a year. An employer may loan PSL to an employee in advance of accrual of paid leave by the employee.
PSL is compensated at the same hourly rate or salary and with the same benefits. The rate must be at least minimum wage but does not include overtime, bonuses or holiday pay. Employees paid commissions or sales-based pay must receive the greater of their hourly or salaried rate or minimum wage.
Public health emergency
In the event of a public health emergency (PHE), up to 80 hours of PSL is required for full-time employees (and two weeks of regular hours for those working fewer than 40 hours per week). This leave supplements the 48-hour requirement. Specifically, the HFWA requires 48 hours for any HFWA purpose (see above) and an additional 32 hours for any of the following reasons:
The employee’s need to self-isolate and care for self because the employee is diagnosed with or having symptoms of a communicable illness that is the cause of a PHE
The employee’s need to seek or obtain a medical diagnosis, care (including preventive care), or treatment if experiencing symptoms of a communicable illness that is the cause of a PHE
The employee is unable to work due to a health condition that may increase susceptibility or risk of such an illness
The employee’s need to care for a child or other family who is in category 1, 2 or 3, or whose school, child care provider, or other care provider is either unavailable, closed, or providing remote instruction due to the PHE
The HFWA defines a “public health emergency” as:
An act of bioterrorism, a pandemic influenza, or an epidemic caused by a novel and highly fatal infection agent, for which (i) an emergency is declared by a federal, state, or local public health agency; or (ii) a disaster emergency is declared by the governor
A highly infectious illness or agent with epidemic or pandemic potential for which a disaster emergency is declared by the governor
An employee shall notify the employer of the need for PSL resulting from a PHE as soon as practicable when the need is foreseeable, and the employer’s place of business has not been closed. No documentation is required for leave taken on account of a PHE. Employees are only eligible for PHE PSL once during the entirety of a PHE even if the PHE is amended, extended, restated or prolonged.
Lockton comment: Currently, the COVID-19 provision in the HFWA expires December 31, 2020. Employers with 15 or fewer employees are not required to provide the PHE PSL even though they were required to provide the HFWA COVID-19 related leave in 2020.
An employer may count the employee’s unused accrued PSL toward the supplemental PSL required by a PHE. An employee may use this additional PSL until four weeks after the official termination or suspension of the PHE. No paid leave is required if an entire business is closed (whether temporarily or permanently). In that case, employees are on furlough or layoff and unemployment insurance, not PSL, is a possible remedy.
Will an employer’s existing policy meet the requirements of the HFWA?
An employer that has a broader paid leave policy for its employees may satisfy the requirements of the HFWA as long as it meets the accrual requirements and provides as much time off as HFWA requires for all conditions and situations that the HFWA covers. An employee must use PSL in hourly increments unless the employer allows PSL to be taken in smaller increments of time. An employer shall not require the employee to search for or find a replacement to cover the time the employee is absent as a condition of using PSL.
Lockton comment: An employer who provides 48 hours or more paid leave that can be taken for any of the reasons in the HFWA and which accrues at least at the rate of one hour for every 30 hours worked meets the requirements of the HFWA. Although an additional 32 hours may be required in the event of a PHE, this does not need to be front-loaded nor is it taken into consideration when determining if an existing policy meets the requirements of the HFWA.
Must employers pay employees for unused PSL at separation?
No reimbursement of unused PSL at termination, resignation, retirement or other separation from employment is required except that an individual may recover PSL as a remedy for a retaliatory personnel action that prevented the employee from using PSL. Note that if an employee separates from employment and is rehired by the same employer within six months of separation, the employer shall reinstate any PSL that the employee had accrued but not used during the prior period of employment
What other employer responsibilities are there under the HFWA?
The HFWA makes it unlawful for an employer to deny PSL to an employee entitled to the leave, and to retaliate against an employee for taking PSL through threats or adverse employment action (e.g., disciplining, suspending, changing hours, demoting, terminating).
Lockton comment: Note that abuse of PSL will not be tolerated by the Division. An employer can take disciplinary action against an employee for using PSL for purposes other than those described or misrepresenting the reason for PSL.
Each employer shall retain records for each employee for a two-year period, documenting hours worked, PSL accrued and PSL used. With notice and at a mutually agreeable time, an employer shall allow the Division access to the records for purposes of monitoring compliance.
Employers must notify employees in writing of their right to PSL, in the amounts and for the purposes identified in the HFWA, without retaliation and display the Colorado Division of Labor and Employment’s informational poster in a conspicuous place where employees work. The “notice” provision can be satisfied by providing a copy of the Division’s Interpretive Guidance (opens a new window) to employees either on paper or electronically. The posting requirement is satisfied by posting the Division poster (yet to be released). If an employer does not maintain a physical workplace, or an employee teleworks or performs work through a web-based platform, the employer shall provide the notice required in this section through electronic communication or a conspicuous posting in the web-based platform.
How are violations of the HFWA addressed?
An employee who claims an employer denied the employee’s right to PSL, interfered with their rights or retaliated against them for taking PSL can file a complaint with the Division of Labor and Employment. In lieu of this, the employee can give the employer a written demand for wages and 14 days to respond. If the claim is not resolved, the employee can file suit in district court. The statute of limitations for filing this civil action in a district court is two years.
The Division investigates claims of retaliation or denial in violation of the HFWA. If the investigation reveals that the rights of multiple employees have been violated, the violation as to each employee is a separate violation for purposes of fines, penalties or other remedies. When a violation costs an employee the employee’s job or pay, the determination may include an order to reinstate the employee, to pay the employee’s lost pay until reinstatement or for a reasonable period if reinstatement is not feasible, or both. Determinations are appealable.
Not legal advice: Nothing in this alert should be construed as legal advice. Lockton may not be considered your legal counsel, and communications with Lockton's HR Compliance Consulting group are not privileged under the attorney-client privilege.