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Non-Compete Agreements

Under a new Federal Trade Commission rule, for-profit employers are prohibited from entering into new non-compete agreements with all employees, including senior executives. The rule applies to independent contractors as well as employees and does not apply to nonprofit organizations.

California, Colorado, Minnesota, Oklahoma and North Dakota have banned noncompete agreements and several other states have passed laws limiting their use. Colorado banned non-compete clauses in 2022, leaving a carve-out for contracts for “highly compensated workers” or HCE’s —anyone making more than $123,750 in 2024. This new FTC ruling would increase that threshold, and still ban the agreements “going forward”.

Existing non-compete agreements with senior executives remain enforceable. The final rule defines senior executives as workers earning more than $151,164 annually and who are in policy-making positions.

Employers must notify all other workers that existing non-competes are unenforceable by the effective date (120 days after publication in the Federal Register, a date that hasn’t yet been announced/finalized). We have attached a model notice from the FTC that you may use to satisfy the notification piece.

As an aside, trade secret laws and non-disclosure agreements (NDAs) both provide employers with means to protect proprietary and other sensitive information.

This new ruling is speculated to face challenges from the U.S. Chamber of Commerce and other groups, and whether it ultimately is enforced by a court is not yet certain.

FLSA Salary Threshold Increase

Next, the exempt salary threshold has been increased, effective July 1, 2024, to $43,888 and increase to $58,656 on Jan. 1, 2025. Note that currently, in Colorado, our minimum exempt salary threshold is at $55,000 for 2024. As of January 1, 2025, the minimum salary threshold for exempt employees in Colorado will be the 2024 salary adjusted by the same Consumer Price Index as the Colorado Minimum Wage. This means that the 2025 exempt threshold will be around $59,800, based on the 2024 threshold of $55,000, though that number is not “final”.

Employees who are considered “exempt” from overtime must not just meet this salary threshold, but also the “duties test”, and must be a salaried bona fide executive, administrative or professional employee exempt from federal overtime pay requirements (Outside Sales, Teachers, and other limited exceptions apply). 

Of note, the federal exempt salary threshold is monitored on a weekly basis, and can only include up to 10% in compensation such as bonuses and commissions. Colorado makes the assessment based on a calendar year, not on a weekly basis, and does not limit the amount of compensation that can be the result of bonuses or commissions. Other states (or cities) may have their own minimum salary threshold, in which case those higher wages prevail.

The salary threshold will be automatically updated every three years starting on July 1, 2027. The DOL has further stated that the threshold for HCE exemption will rise, to $132,964 on July 1, then to $151,164 on January 1, 2025.

In not “new news”, at all times, employers should ensure that they understand the difference and impact of classifying a worker as exempt or non-exempt. Misclassifying workers as exempt when they do not pass the duties test can have drastic consequences for the employer – non-exempt workers must receive one and a half times their hourly rate for hours worked in excess of 40 in any given workweek, and in excess of 12 hours in any given workday (Colorado). They must also be given breaks in accordance with the state in which they are working.

Some of you may find the above familiar, back in 2015 the Obama administration attempted to raise the salary threshold. A judge in Texas blocked the rule from taking effect, and the DOL stopped pursuing the rule due to a change in presidential administration.

InTANDEM HR recommends all employers prepare for the increase as if it will go through. If it is blocked, we will certainly inform you. Now is the time to review your exempt worker’s salaries, to ensure they meet the new threshold, or prepare to change them to hourly and non-exempt.

The Pregnant Workers Fairness Act (PWFA) was signed into law in 2022, taking effect on June 27th, 2023. The PWFA is the first federal law enforced by the EEOC that requires employers to provide accommodations for medical conditions relating to a woman’s pregnancy, absent a showing of disability. Keep in mind that Colorado has a PWFA of their own, enacted in 2016 (as do at least half of the states in the U.S.).

The federal PWFA regulations refer to current pregnancy, past pregnancy or potential and intended pregnancy, e.g., infertility, fertility treatment and contraception use. “Related medical conditions” are defined in the PWFA Regulations as medical conditions relating to pregnancy or childbirth of the specific employee seeking an accommodation. Covered related medical conditions can include complications related to the termination of the pregnancy such as miscarriage, stillbirth, abortion, and post-partum complications like anxiety, depression, incontinence, menstruation and lactation. The PWFA Regulations would also include reproductive health issues that are not directly related to an actual current, or recent pregnancy.

The PWFA coverage definition is the same as the ACA (reasonable accommodations required by the employer). However, there is no requirement that such physical or mental condition substantially limit a major life activity, like the ADA. The PWFA requires accommodation of employees who may not be qualified to perform the essential functions of the job, as long as their limitation is “temporary”, and not permanent.

Accommodations might include: modifications include: (1) allowing an employee to carry or keep water near and drink, as needed; (2) allowing an employee to take additional restroom breaks, as needed; (3) allowing an employee whose work requires standing to sit and whose work requires sitting to stand, as needed; and (4) allowing an employee to take breaks to eat and drink, as needed.

It is important to understand how the federal requirements may exceed that of state and local law. Further, if you have any questions, you should reach out to a qualified HR person at InTANDEM HR for consultation.

Governor Polis signed the Protecting Opportunities and Workers’ Rights (POWR) Act into law June 7th, expanding the Colorado Anti-Discrimination Act (CADA). The truncated version of how this impacts Colorado employers is:

Record Keeping Requirement UPDATE:
1. Employers must keep personnel or employment records for at least five years after either (A) the date the employer made or received said record or (B) the date of the personnel action that the record pertains to or the final disposition of a charge of discrimination or any related action.
1. InTANDEM HR maintains our own personnel records for all electronic onboarding, all documents that are uploaded to the repository, and anything sent to us.
2. Employers must now maintain an “accurate, designated repository” of all written or oral complaints of “discriminatory or unfair employment practices,” as defined under the CADA Section 24–34–402(1)(a) https://law.justia.com/codes/colorado/2016/title-24/principal-departments/article-34/part-4/section-24-34-402. It must include the date of the complaint, identities of the complainant and the perpetrator (if disclosed), and the substance of the complaint.

Discrimination law UPDATE
POWR Act, imposes changes to CADA, redefining the standard for harassment claims, setting stringent requirements on NDA’s, and adding marital status as a protected category.

Colorado had matched the federal law definition of “harassment” which required that for conduct to be considered harassment, it must be “severe or pervasive.” With the POWR Act, the severe or pervasive standard no longer applies in Colorado. Now, in the Centennial state, conduct that is “subjectively offensive to the individual alleging harassment and is objectively offensive to a reasonable individual who is a member of the same protected class” will be considered harassment under Colorado law.
The conduct at issue must fall in one of the three categories for a harassment claim to be viable:
1. Submission to the conduct or communication is explicitly or implicitly made a term or condition of the individual’s employment; or
2. Submission to, objection to, or rejection of the conduct or communication is used as a basis for employment decisions affecting the individual; or
3. The conduct or communication has the purpose or effect of unreasonably interfering with the individual’s work performance or creating an intimidating, hostile, or offensive working environment.
POWR expressly states that “petty slights, minor annoyances, and lack of good manners do not constitute harassment unless the slights, annoyances, or lack of manners, when taken individually or in combination under the totality of the circumstances.”

It also limits the ability of employers to assert an affirmative defense to a harassment claim in cases where the employee alleges harassment by a supervisor. Employers can only assert an affirmative defense to this type of claim if it meets each of the following requirements:

1. The employer has established a program designed to prevent harassment, deter future harassers, and protect employees from harassment. The employer must both “take prompt, reasonable action to investigate or address alleged discriminatory or unfair employment practices” and “take prompt, reasonable remedial actions, when warranted, in response to complaints of discriminatory or unfair employment practices.”
2. The employer has communicated the existence and details of how to make complaints to both its supervisory and nonsupervisory employees, such as through a handbook or policy; and
3. The employee has unreasonably failed to take advantage of this reporting program.

THIS IS WHERE YOUR HANDBOOK COMES IN. All InTANDEM HR approved employee handbooks include an anti-harassment provision and complaint reporting mechanism. All employees who electronically onboard automatically receive their approved handbook. IF YOU DO NOT have an approved handbook, and if you are not electronically onboarding all team members, you are vulnerable to not being able to use an affirmative defense.

Disability Discrimination
Previously, CADA provided that it was not a discriminatory practice for an employer to take an adverse employment action “if there is no reasonable accommodation that the employer can make with regard to the disability, the disability actually disqualifies the individual from the job, and the disability has a significant impact on the job.” The requirement that the disability had “a significant impact on the job” has been eliminated. The loosened standard provides only that it is not a discriminatory practice for an employer to take an adverse employment action “if there is no reasonable accommodation that the employer can make with regard to the disability that would allow the individual to satisfy the essential functions of the job and the disability actually disqualifies the individual from the job.”

Marital Status
Marriage status to a coworker has been protected for some time, unless there is direct supervision. Now, all marital status is protected (briefly, I will say that it is my experience employers have always operated under that respect and assumption, though it is now “law law”).

Non-Disclosure Agreement Requirements
If you have made it this far, I commend you. I will further say, please, have your NDA reviewed by a licensed employment law attorney (which I am not nor ever would I pretend to be). There are significant and many changes to NDA requirements that must be met for a nondisclosure provision to be enforceable in the employment context.

Keep in mind that these laws are not retroactive, but rather kicked in on Monday, August 7th, 2023.

The EEPEWA, which was signed into law on June 5, 2023 and will go into effect on January 1, 2024, expands the Equal Pay for Equal Work Act (effective January 1, 2021), which imposed equal pay requirements and required employers to disclose salary ranges and employee benefits in job postings. It further required disclosing promotional opportunities to their employees.

We have become accustomed to (I hope, if not, read on) including the salary range and a brief description of benefits in ALL of our Colorado job postings, and sending that job posting internally to all current employees to ensure they are aware of the opportunity on that same day it is posted externally (limited exceptions apply, for instance, if someone is getting terminated and hasn’t yet gotten “the news”).
Effective January 1, 2024, the EEPEWA The EEPEWA also imposes new disclosure requirements for “job opportunities,” and in addition to the current requirements, mandates that employers include “the date the application window is anticipated to close.” We can assume that “once I find someone” will not “count”.

Also, within 30 days of selecting a candidate for a job opportunity, the EEPEWA requires the employer to make reasonable efforts internally to disclose certain information about the selected candidate—at a minimum, informing employees who will work with the new hire. This includes (a) the candidate’s name, (b) their former job title (if the candidate was an internal hire), (c) their new job title, and (d) information on how employees can express interest in similar job opportunities in the future, unless it would violate the candidate’s privacy rights under other relevant laws or pose a risk to their health and safety.
For positions with “career progression,” the EEPEWA requires employers to make available to “eligible employees” information about the requirements for such progression, in addition to information about each position’s compensation, benefits, full-time or part-time status, responsibilities, and further advancement.

Under the EEPEWA, the CDLE has indicated that individuals bringing sex-based wage discrimination claims may seek back pay going back twice as long as they could previously: up to six years instead of three.

Call or email InTANDEM HR if you are a current or prospective client, and this hurts your head, and you want your head to stop hurting.

Governor Jared Polis signed into law Senate Bill 23-017 on June 2, 2023. This Bill expands the reasons employees can use paid sick leave under Colorado’s Healthy Families & Workplaces Act (HFWA). They may now us it for qualifying bereavement and natural disaster-related reasons.

The current mandate under HFW requires that at a minimum, CO employees accrue one hour of sick leave for every 30 hours worked, to be accessed for any of these reasons:

1. A mental or physical illness, injury, or health condition that prevents work;
2. Obtaining preventive medical care (including a vaccination), or a medical diagnosis, care, or treatment, of any mental or physical illness, injury, or health condition;
3. Obtaining medical attention, mental health care or other counseling, legal or other victim services, or relocation required as a result of being a victim of domestic abuse, sexual assault, or criminal harassment;
4. To care for a family member who has a mental or physical illness, injury, or health condition, or who needs the sort of care listed in categories 1-3;
5. Closure by a public official of the employee’s place of business or the employee’s child’s school or place of care due to a public health emergency (as defined by the law), requiring the employee to care for the child.

Effective August 7, CO employees may also take accrued sick leave for the following reasons:

6. To grieve, attend funeral services or a memorial, or deal with financial and legal matters that arise after the death of a family member;
7. To care for a family member whose school or place of care has been closed due to inclement weather, loss of power, loss of heating, loss of water, or other unexpected events; or
8. To evacuate the employee’s place of residence due to inclement weather, loss of power, loss of heating, loss of water, or other unexpected events.

InTANDEM HR will be updating all of our client’s Employee Handbooks to comply with this law, and will further update the PHEW poster once it is available through the state of Colorado. Contact your HR Generalist or the HR Director of InTANDEM HR if you are a client or employee with questions on this enhanced change to sick leave usage in Colorado.

The 2024 limits for HSA contributions have been published by the IRS with a notable, if not unsurprising, jump in allowable contributions. For individual coverage, limits have increased by 7.8 percent, bringing the contribution limit to $4,150. For those with an HSA covering the whole family, those limits rose 7.1 percent, to an allowable maximum contribution of $8,300. Increases in these contribution limits do typically occur on an annual basis, however, the percentage increase has continued to grow in recent years. In 2021 going into the 2022 benefit year, rates increased by about 1.4 percent, then again by 5.5 percent from 2022 into 2023, and most recently, over a 7 percent increase for both self-only and family plans.

Those who participate in an HSA and are 55 years of age or older can still contribute an additional $1,000 as a catch-up amount in 2024.
Changes to limits for 401(k) contributions and other benefits like flexible spending accounts are yet to be released.

As open enrollment season approaches in fall of 2023, employers should begin conversations about changes they wish to make to their offerings, including whether they will elect to increase employer contributions to HSAs given the increased limits. Employees can ensure they are well-informed of the benefits available by reaching out to their InTANDEM HR account manager with any questions on health savings accounts and their complementary high-deductible medical plans.

The year 2020 brought forth an onslaught of fraudulent unemployment claims all across the country. Colorado was no exception. After a period of relative absence of phony claims, the fraudsters are back at it. Recently, the CDLE (Colorado Department of Labor and Employment) issued the following alert to employers AND claimaints:

ALERT | 4.20.2023 | 1:30 p.m.

CDLE is experiencing an uptick in fraudulent attempts to gain access to Unemployment Insurance benefits. Fraudsters are attempting to hijack existing claims and file new fraudulent claims for people not already in the system. If you receive an email asking you to reset your password, please ignore this message and follow these instructions:

IF YOU ARE NOT A UI CLAIMANT: Please fill out a fraud reporting form on our website. If your employer notifies you that someone has filed a claim on your behalf, please have them also fill out a fraud form.

CURRENT CLAIMANTS should ignore the email and log in to their MyUI+ account from the official UI website, in order to verify that your information (contact, banking, payments, etc) is correct.

If you are able to log in and all your information is correct, no further action is necessary.

If you log in to your account and your information has been altered, please update the information and then reset your password. If you notice that a payment has gone to an account that is not yours, please fill out a fraud form on our website*. If you are NOT able to log in to your account, please fill out a fraud report on our website (instructions below)*.

*Please note that if you fill out a fraud report, you may be temporarily locked out of your account while we investigate the issue.

InTANDEM HR will continue to detect and report fraudulent unemployment claims as they are received.

In an announcement earlier this year, President Biden declared that the Federal COVID-19 public health emergency will end May 11th. It had been renewed 12 times by Health and Human Services Secretary Xavier Becerra. In Colorado that declaration starts the 4-week timer until PHE paid leave ends at the state level. Some federal programs like Medicare, Medicaid and CHIP may see an end to flexibility with certain requirements that had been bypassed or modified during the pandemic. Participants in those programs, as well as group and individual health plans, may see changes in their cost for COVID-19 testing, vaccination and other related services.

Assuming no further changes, extensions or declarations on the part of federal or state entities, June 8th will mark the final day that PHE paid leave will be offered in Colorado. Employers should note that this has no impact on the state-wide accrued paid sick leave that took effect in January 2021, as that requirement to provide one hour of paid leave per 30 hours worked up to 48 each year remains intact. Keep in mind that if a local, state, or federal PHE is declared in the future, the PHE provision of the HFWA will go back into effect.
As always, contact your Account Manager or the HR Director here at InTANDEM Human Resources with any questions on this or other HR and payroll matters.

Colorado FAMLI Deductions Have Begun – What’s Next for this Program During 2023?

At the start of 2023, employers across the state of Colorado began collecting premiums to fund the FAMLI program, which will provide paid family and medical leave to Colorado workers starting in 2024. Employees will be able to file claims to draw from the fund beginning January 2024. A wealth of information has already been released from the Colorado Department of Labor and Employment, and it can be overwhelming as an employer to stay informed. Here are a few of the key milestones the program anticipates during 2023 and into 2024, and how you can stay in the loop:

January 1, 2023: Employers begin deducting premiums from employees and setting aside their employer contribution. Employers must post the 2023 Required Program Notice in a prominent area in the workplace. InTANDEM HR emailed this poster to client contacts, and posted to the ESS. Resources for this posting and other communications to employees can be found in the FAMLI Toolkit on the CDLE website.

March 31, 2023: The FAMLI Division anticipates the process for approving private plan applications will be up and running by this date, though the functionality is not yet available. Employers can find information on private plans on the FAMLI section of the CDLE website in the meantime.

April 30, 2023: Employers must be registered and have a My FAMLI+ Employer account. First premium payments are due from Q1. InTANDEM HR has handled this for our clients.

July 31, 2023: Premium payments are due from Q2.

October 31, 2023: Premium payments are due from Q3. Private plans must be approved by this date in order for employers to request a refund for 2023 premiums. Private plan information can be found on the CDLE’s FAMLI website here.

No later than December 31^st, 2023: InTANDEM HR will update all existing client’s Employee Handbooks to reflect pertinent FAMLI information. 

January 1, 2024: Employee can start filing claims for benefits.

January 31, 2024: Premium payments are due from Q4.

With all this slated to occur in 2023 (and more to come!), what can an employer do to stay on top of deadlines and changes?

Town Halls: These virtual one-hour sessions provide the basics of the program and a Q&A at the end – to RSVP for the 2/28 or 3/21 sessions (available in English or Spanish), use this form. The CDLE anticipates offering hybrid sessions in Summer of 2023.

Webinars: Recordings of prior informational webinars on a variety of FAMLI-related topics are available to view here on the CDLE website. You can also see a list of upcoming webinars on that page.

Newsletter: Register for the FAMLI newsletter and stay up to date on newly released information, deadlines and other important details about the FAMLI program.

Connect with Professionals: Reach out to us! As a Colorado-based PEO, we are up to speed and ready to help you and your employees navigate through this new benefit. Contact your InTANDEM HR Account Manager or HR Director with questions.

All Colorado employers, regardless of size or industry, still must give employees both (1) “accrued” paid sick leave (one hour per 30 hours worked, up to 48 hours a year), and (2) public health emergency (“PHE”) leave (two weeks — 80 hours, or less for part-time employees) under the Colorado Healthy Families and Workplaces Act (HFWA). Colorado’s 80-hour PHE leave is ongoing: It continues as long as a federal or state PHE is declared (C.R.S. § 8-13.3-402(9)) — and while state public health orders have been scaled back, currently federal and Colorado PHEs both remain declared.

As of January 8, 2023, the conditions covered by Colorado’s latest PHE declaration are COVID-related only. From November 11, 2022 until January 8, 2023, the conditions covered by Colorado’s PHE declaration at the time include health needs related to not just COVID, but also flu, respiratory syncytial virus (“RSV”), and similar respiratory illnesses. Those with flu or RSV symptoms already were likely covered as having COVID symptoms — so a key impact of this expansion may be that coverage remains even if testing confirms someone has flu or RSV rather than COVID. The expansion beyond COVID doesn’t give employees an extra 80 hours for those conditions, it just means they can use their 80 hours for a broader range of conditions.

This 80-hour PHE leave will continue until four weeks after all applicable PHE declarations end or are suspended. Based on the current emergency declarations, PHE emergency leave will continue at least into May 2023, but will continue longer if either the federal or the state PHE declaration is renewed further into 2023. For more information on paid sick leave, please see the CDLE Division of Labor Standards and Statistics’ HFWA webpage: https://cdle.colorado.gov/hfwa