Statute text
As used in this article 4, unless the context otherwise requires:
(1) "Citation" means a written determination by the division that a wage payment requirement has been violated.
(2) "Credit" means an arrangement or understanding with the bank or other drawee for the payment of an order, check, draft, note, memorandum, or other acknowledgment of indebtedness.
(3) "Director" means the director of the division of labor standards and statistics or his or her designee.
(4) "Division" means the division of labor standards and statistics in the department of labor and employment.
(5) "Employee" means any person, including a migratory laborer, performing labor or services for the benefit of an employer. For the purpose of this article 4, relevant factors in determining whether a person is an employee include the degree of control the employer may or does exercise over the person and the degree to which the person performs work that is the primary work of the employer; except that an individual primarily free from control and direction in the performance of the service, both under his or her contract for the performance of service and in fact, and who is customarily engaged in an independent trade, occupation, profession, or business related to the service performed is not an "employee".
(6) "Employer" has the same meaning as set forth in the federal "Fair Labor Standards Act of 1938", 29 U.S.C. sec. 203 (d), and includes a foreign labor contractor and a migratory field labor contractor or crew leader; except that the provisions of this article 4 do not apply to the state or its agencies or entities, counties, cities and counties, municipal corporations, quasi-municipal corporations, school districts, and irrigation, reservoir, or drainage conservation companies or districts organized and existing under the laws of Colorado.
(7) "Field labor contractor" means anyone who contracts with an employer to recruit, solicit, hire, or furnish migratory labor for agricultural purposes to do any one or more of the following activities in this state: Hoeing, thinning, topping, sacking, hauling, harvesting, cleaning, cutting, sorting, and other direct manual labor affecting beets, onions, lettuce, potatoes, tomatoes, and other products, fruits, or crops in which labor is seasonal in this state. Such term shall not include a farmer or grower, packinghouse operator, ginner, or warehouseman or any full-time regular and year-round employee of the farmer or grower, packinghouse operator, ginner, or warehouseman who engages in such activities, nor shall it include any migratory laborer who engages in such activities with regard to such migratory laborer's own children, spouse, parents, siblings, or grandparents.
(8) "Fine" means any monetary amount assessed against an employer and payable to the division.
(8.5) "Foreign labor contractor" means any person who recruits or solicits for compensation a foreign worker who resides outside of the United States in furtherance of that worker's employment in Colorado; except that "foreign labor contractor" does not include any entity of the federal, state, or local government.
(9) "Migratory laborer" means any person from within or without the limits of the state of Colorado who offers his or her services to a field labor contractor, whether from within or from without the limits of the state of Colorado, so that said field labor contractor may enter into a contract with any employer to furnish the services of said migratory laborers in seasonal employment.
(10) "Notice of assessment" means a written notice by the division, based on a citation, that the employer must pay the amount of wages, penalties, or fines assessed.
(11) "Notice of complaint" means the letter sent by the division as described in section 8-4-111 (2)(a).
(12) "Penalty" means any monetary amount assessed against an employer and payable to an employee.
(13) "Wage complaint" means a complaint filed with the division from an employee for unpaid wages alleging that an employer has violated section 15 of article XVIII of the Colorado constitution, this article, article 6 of this title, or any rule adopted by the director pursuant to this article or article 6 of this title.
(14) (a) "Wages" or "compensation" means:
(I) All amounts for labor or service performed by employees, whether the amount is fixed or ascertained by the standard of time, task, piece, commission basis, or other method of calculating the same or whether the labor or service is performed under contract, subcontract, partnership, subpartnership, station plan, or other agreement for the performance of labor or service if the labor or service to be paid for is performed personally by the person demanding payment. No amount is considered to be wages or compensation until such amount is earned, vested, and determinable, at which time such amount shall be payable to the employee pursuant to this article.
(II) Bonuses or commissions earned for labor or services performed in accordance with the terms of any agreement between an employer and employee;
(III) Vacation pay earned in accordance with the terms of any agreement. If an employer provides paid vacation for an employee, the employer shall pay upon separation from employment all vacation pay earned and determinable in accordance with the terms of any agreement between the employer and the employee.
(IV) "Paid sick leave" as provided in part 4 of article 13.3 of this title 8.
(b) "Wages" or "compensation" does not include severance pay.
(15) "Written demand" means any written demand for wages or compensation from or on behalf of an employee, including a notice of complaint, mailed or delivered to the employer's correct address.
History
Source: L. 2003: Entire article amended with relocations, p. 1850, 1, effective August 6. L. 2014: Entire section amended, (SB 14-005), ch. 276, p. 1110, 2, effective January 1, 2015. L. 2016: (3) and (4) amended, (HB 16-1323), ch. 131, p. 378, 10, effective August 10. L. 2019: IP, (5), and (6) amended and (8.5) added, (HB 19-1267), ch. 182, p. 2058, 2, effective January 1, 2020. L. 2020: (14)(a)(IV) added, (SB 20-205), ch. 294, p. 1457, 2, effective July 14.
Annotations
Cross references: (1) For the short title ("Wage Protection Act of 2014") in SB 14-005, see section 1 of chapter 276, Session Laws of Colorado 2014.
(2) For the legislative declaration in HB 19-1267, see section 1 of chapter 182, Session Laws of Colorado 2019.
Annotations
ANNOTATION
Annotations
Law reviews. For article, "Payment of Employee Vacation Time in Colorado", see 51 Colo. Law. 36 (May 2022).
Annotator's note. The following annotations include cases decided under this section as it existed prior to the 2003 amendment to article 4, which resulted in the relocation of provisions.
The provisions of the wage claim act should be liberally construed to carry out its purpose of assuring timely payment of wages and providing adequate judicial relief when wages are not paid. Hofer v. Polly Little Realtors, Inc., 543 P.2d 114 (1975); Cusimano v. Metro Auto, Inc., 860 P.2d 532 (Colo. App. 1992).
Therefore, construing the Act to impose personal liability for wages on high ranking corporate officers furthers that legislative purpose. Cusimano v. Metro Auto, Inc., 860 P.2d 532 (Colo. App. 1992).
Wage claim act provides a clear, comprehensive statutory scheme designed to require an employer to pay wages earned by their employees in a timely manner. Lambdin v. Dist. Ct. of Arapahoe Cty., 903 P.2d 1126 (Colo. 1995).
Timely compensation or judicial relief intended. The beneficent purpose of the general assembly in drafting this section was to assure that employees would be timely compensated for labor or services and that when not so compensated they would be entitled to adequate judicial relief. Hofer v. Polly Little Realtors, Inc., 37 Colo. App. 86, 543 P.2d 114 (1975).
A plaintiff may bring claims under both the federal Fair Labor Standards Act and the state wage claim act. Redmond v. Chains, Inc., 996 P.2d 759 (Colo. App. 2000).
Real estate salesman not "employee" within definition of subsection (5). Hyland v. Pikes Peak Capital Corp. 714 P.2d 914 (Colo. App. 1985).
The term "interstate drivers" in Wage Order No. 31, 7 Colo. Code Regs. 1103-1, applies to drivers whose work takes them across state lines, regardless of how often. Thus, the state exemption from overtime pay in the work order is triggered the first time a driver crosses state lines during a work trip. Gomez v. JP Trucking, Inc., 2022 CO 21, 509 P.3d 429.
Association of counties and municipal corporations excepted from "employer". Since counties and municipal corporations are excepted from the definition of "employer", an association which consists of counties and municipal corporations is also excepted. Paulu v. Lower Ark. Valley Council of Gov'ts, 655 P.2d 1391 (Colo. App. 1982).
Definition of "employer" in subsection (6) does not include individual officers and agents of a corporation. Leonard v. McMorris, 63 P.3d 323 (Colo. 2003) (disagreeing with Cusimano v. Metro Auto., Inc., cited below).
Corporate officers not individually liable for wages. The officers and agents of a corporation are not jointly and severally liable for payment of employee wages and other compensation the corporation owes its employees under the employment contract and the wage claim act. Leonard v. McMorris, 63 P.3d 323 (Colo.) (disagreeing with Cusimano v. Metro Auto., Inc., cited below), 320 F.3d 1116 (10th Cir. 2003).
Definition of "employer" in subsection (6) clearly discloses an intent to impose personal liability for wages on at least high ranking corporate officers based solely on their status as officers, and the definition is not expressly limited to corporate officers with duties in relation to the unpaid employee. Cusimano v. Metro Auto, Inc., 860 P.2d 532 (Colo. App. 1992); Major v. Chons Bros., Inc., 53 P.3d 781 (Colo. App. 2002).
A general manager whose duties included scheduling of overtime work but who had been given no authority or responsibility over wage payment policies was not subject to personal liability under the wage claim act. Major v. Chons Bros., Inc., 53 P.3d 781 (Colo. App. 2002).
Federal Bankruptcy Code does not preempt claims against corporate officers under the state wage claim act. Claims under the wage claim act would be preempted if brought against the corporation because the corporation filed a bankruptcy petition. The Bankruptcy Code does not, however, extend its protections to individuals or entities that have not filed a bankruptcy petition. In the absence of such a statutory provision, no direct conflict exists between the Bankruptcy Code and the wage claim act. Leonard v. McMorris, 106 F. Supp. 2d 1098 (D. Colo. 2000), rev'd on other grounds, 320 F.3d 1116 (10th Cir. 2003).
The term "corporation" in subsection (6) refers to private corporations, since municipal and quasi-municipal corporations are mentioned separately as exceptions. Paulu v. Lower Ark. Valley Council of Gov'ts, 655 P.2d 1391 (Colo. App. 1982).
The term "employer" in subsection (6) does not include the state of Colorado. The wage claim act does not apply to the state or state agencies. Lang v. Colo. Mental Health Inst. in Pueblo, 44 P.3d 262 (Colo. App. 2001).
To find that short-term disability policy benefits are "wages or compensation", under a plain reading of this section, an employee must show that the benefit amounts must be (1) for labor or service, (2) earned, (3) vested, and (4) determinable. Kouzmanoff v. Unum Life Ins. Co. of Am., 374 F. Supp. 3d 1076 (D. Colo. 2019).
Vacation pay is within the definition of "wages or compensation". Hartman v. Freedman, 197 Colo. 275, 591 P.2d 1318 (1979); Thompson v. Cheyenne Mtn. Sch. Dist., 844 P.2d 1235 (Colo. App. 1992).
Payments under employer's growth bonus program were "wages" where plan replaced existing commission programs, provided for cash payments to supplement employees' regular earnings based on their efforts in areas of sales and company growth, no components of the fund were based on net profit, and only one component was based on "gross profit". Gray v. Empire Gas, Inc., 679 P.2d 610 (Colo. App. 1984).
Bonus is "wages or compensation" where it is both vested and determinable as of the date of termination, where the bonus is disproportionately large in relation to the base salary, and where bonus was owed as compensation for services performed by individual employee rather than pursuant to profit-sharing plan. Rohr v. Ted Neiters Motor Co., 758 P.2d 186 (Colo. 1988).
There is an implied right to compensation for unused vacation time upon termination of contract with school district absent an express agreement to the contrary. Thompson v. Cheyenne Mtn. Sch. Dist., 844 P.2d 1235 (Colo. App. 1992).
Although an employee is not entitled to vacation pay, if an employer chooses to provide vacation pay, it cannot be forfeited once it is earned regardless of an employment agreement to the contrary that states that accrued but unused vacation time is not payable if the employee is fired or fails to give two weeks notice. Nieto v. Clark's Market, Inc., 2021 CO 48, 488 P.3d 1140.
This section was amended to specifically exclude severance pay as wages or compensation, effective August 6, 2003, however the general assembly appears to acknowledge that a severance payment could constitute wages or compensation under the previous version of the statute. Fang v. Showa Entetsu Co., 91 P.3d 419 (Colo. App. 2003).
Employee failed to show that short-term disability policy benefits were "wages or compensation". The benefits were not amounts for labor or services performed. Employer only pays monies pursuant to this policy to the extent that an eligible employee is unable to work. The benefits replace a portion of an employee's income in the event of sickness or injury. Employee's claim fails because the disability benefits flow from his declared inability to work, rather than from labor or service pursuant to the employment contract. Kouzmanoff v. Unum Life Ins. Co. of Am., 374 F. Supp. 3d 1076 (D. Colo. 2019).
And even if the short-term disability benefits were for labor or services, under the policy, the employer retained the power to cease the short-term benefits altogether for any reason or no reason at all. The benefits are better viewed as status perks to which employees have no vested wage claim should an employer discontinue them. Kouzmanoff v. Unum Life Ins. Co. of Am., 374 F. Supp. 3d 1076 (D. Colo. 2019).
Liability of corporate officers for wages. Subsection (6) is at least susceptible to the interpretation that corporate officers are personally liable for wages due employees. Fischer v. District Court, 561 P.2d 1266 (1977); Cusimano v. Metro Auto, Inc., 860 P.2d 532 (Colo. App. 1992); Major v. Chons Bros., Inc., 53 P.3d 781 (Colo. App. 2002).
Labor Peace Act does not limit or constrain the law on metropolitan sewage disposal districts concerning the determination of prevailing rates of pay. Such a district is not required to negotiate or engage in collective bargaining in fixing employee compensation at prevailing rates for equivalent work. Local 1 v. Metro Wastewater Reclamation, 876 P.2d 82 (Colo. App. 1994).
Applied in Cavic v. Pioneer Astro Indus., Inc., 825 F.2d 1421 (10th Cir. 1987); Olsen v. Bondurant and Co., 759 P.2d 861 (Colo. App. 1988).