Polis signs wage theft bill into law

June 10, 2022
by Robert Davis | The Center Square

(The Center Square) – Colorado Governor Jared Polis signed a bill Thursday that increases penalties for businesses that withhold earned wages from workers without warrant.

Senate Bill 22-161 classifies wage theft as criminal theft and imposes automatic penalties of up to twice the withheld amount or $1,000, whichever is greater, against employers who violate the law. It also requires employers to pay an estranged employee’s earned wages within 14 days of receiving a written demand.

The bill was sponsored by Democrat Sens. Jessie Danielson, D-Wheat Ridge, and Sonya Jacquez Lewis, D-Boulder, and Reps. Monica Duran, D-Wheat Ridge, and Meg Froelich, D-Englewood.

“Wage theft is far too prevalent in Colorado, and it often hits working families the hardest,” Danielson said in a statement. “It’s essential that we support the folks who work hard to keep Colorado’s economy running. This law will ensure workers receive the full wages they have earned.”

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More states should follow new Colorado policy on wage theft (CO)

BY TERRI GERSTEIN
05/30/19 04:00 PM EDT

Something important for workplace justice quietly happened in Colorado this month, unheralded amidst the roar of our national politics. Governor Jared Polis signed a bill strengthening the penalties for employers who commit wage theft. In Minnesota, even stronger legislation was sent to Governor Tim Walz this week. Now other states should follow their lead.

Why does this matter? Because workers are cheated of pay every day. The incidence of workplace abuse is high. When people do not get paid, it has a huge impact on their lives, as we saw in the federal shutdown. Our laws too often treat employer crimes with a light touch, levying only minimal penalties amounting to little more than a slap on the wrist. The new law in Colorado appropriately treats wage theft with the seriousness it deserves.

Worker advocates started using the term “wage theft” awhile ago. The phrase began to take hold more broadly after activist Kim Bobo wrote a 2011 book by that name. Since then, “wage theft” entered the vernacular and eventually legal terminology, as worker exploitation and economic inequality have become high profile national issues. Of course, “wage theft” sounds more visceral and less wonky than “nonpayment of wages” or “violations of wage law,” but this term is not just better marketing or political framing, it is a more accurate description of what happens. I work 60 hours a week. You do not pay me or pay only a portion of what you owe or a fraction of what is required by law. You stole my work. That is theft.

It took awhile for people to wrap their minds around this, as we tend to think of theft as taking something that someone owns, something that you could actually touch and seek to recover, such as cars, cash, wallets, laptops, or other valuable objects. But work by people is also valuable. The legislation in Colorado perfectly demonstrates this conceptual leap. Seeking to combat both wage theft and human trafficking, the law notes the need “to recognize labor as a thing of value that can be subject to theft” and states that “to protect all workers, it is necessary to close loopholes that allow for the exploitation of human labor for profit.”

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Polis Signs Local Minimum Wage Control Into Law (CO)

BY BENTE BIRKELAND
MAY 29, 2019

Cities and counties in Colorado will be able to set their local minimum wage higher than the statewide rate thanks to a new law Gov. Jared Polis signed Wednesday.

The statewide minimum wage will rise to $12 an hour in 2020. Supporters of the new law say Colorado’s minimum wage should serve as a floor, not a ceiling.

“When it comes to local wages, who better to know what people are actually struggling with and what the need is for the community than actually those that are on the front lines,” said Eva Henry, a county commissioner in Adams County.

Henry adds her county hasn’t yet discussed whether or not to increase the minimum wage.

The new law does limit the number of local governments that could increase their minimum wages, to no more than 10 percent of Colorado’s local jurisdictions. It also stipulates the wage floor can’t increase by more than 15 percent each year and allows local communities to work together to come up with regional minimum wages. Opponents worry about the patchwork of wages and its effect on businesses and overall administrative costs.

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Amendments To Colorado Wage Act Increase Employers’ Exposure To Criminal And Civil Personal Liability (CO)

JD Supra
June 11, 2019

The Legislature was busy this year, passing a variety of bills that will affect Colorado employers. House Bill 19-1267, entitled Penalties for Failure to Pay Wages, amends the Colorado Wage Act in ways that could be significant for all employers with operations in the state. The amendment, which was signed into law this month by Gov. Jared Polis (D), will take effect on January 1, 2020, and will apply to any offenses committed on or after that date.

The Legislative declaration accompanying the amendment says that the Legislature’s purpose is to provide more protection for victims of human trafficking because “[p]ersons who commit the crime of human trafficking often commit other crimes such as wage theft, tax evasion, and workers’ compensation fraud.”

Wage theft

On the surface, the amendment seems to apply only to the criminal provisions of the Wage Act. The current version of the Wage Act provides that certain violations can be prosecuted as unclassified misdemeanors, including “willful refusal to pay wages, falsely denying the amount or validity of a wage claim with intent to underpay or to annoy, harass, oppress, hinder, delay, or defraud an employee, and intentional failure to pay minimum wage.” Intentional refusal to pay wages owed is currently punishable by a fine of up to $300, up to 30 days in prison, or both. Intentional failure to pay the minimum wage is punishable by a fine ranging from $100 to $500, or imprisonment ranging from 30 days to one year, or both.

Individual liability for unpaid wages

The amendment also changes the definition of “employer,” which will affect all other components of the Wage Act, including the civil provisions.

In 2003, the Colorado Supreme Court ruled that officers and agents of a company were not personally liable for unpaid wages. In Leonard v. McMorris, the Court applied the definition of “employer” in Section 8-4-101(6) of the Wage Act and found that the Legislature did not intend to force officers and agents to act as sureties in the event that payroll was not met.

The new amendment specifically says that Leonard “does not provide sufficient protections for workers and their families.” Although it is not completely clear, it appears that the Legislature intends to overrule Leonardand that the case should no longer be relied upon as good law.

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Colorado passes law making wage theft a felony (CO)

Author – Kim Slowey
Updated – May 17, 2019

UPDATE: May 17, 2019: Colorado Gov. Jared Polis on May 16, signed The Human Right to Work With Dignity Act (HB-1267) into law, reclassifying intentional nonpayment of more than $2,000 of wages a felony theft.

“Unscrupulous employers who purposefully withhold wages or underpay workers hurt the economy by undercutting good employers’ bids, engaging in tax fraud and denying workers fair compensation,” said one of the Act’s sponsors, Rep. Meg Froelich.

The new law takes effect Jan. 1, 2020.

Dive Brief:

  • The Colorado General Assembly’s House Judiciary Committee approved a proposed wage theft bill that would make intentional underpayment of certain wages a criminal offense.
  • In Colorado it is a misdemeanor to willfully short employees on their paychecks, but the new measure would make it a felony theft to intentionally underpay them by $2,000 or more. The bill includes migratory and foreign workers under the definition of employee.
  • One of the bill’s stated intentions is to provide an additional vehicle for state law enforcement to fight labor trafficking by recognizing labor as a thing of value that is subject to theft. According to the General Assembly, labor trafficking each year costs Colorado workers hundreds of millions of dollars and the loss of tens of millions of dollars to the state.

Dive Insight:

According to the Colorado Fiscal Institute, more than 500,0000 workers in the state – many of them in the construction industry – lose $750 million a year because of wage theft. The institute’s analysis shows that the most common methods employers use to short employees on their pay are:

  • Nonpayment, which includes late payments and not paying employees what they’ve earned.
  • Underpayment.
  • Misclassification of employees as independent contractors in order to avoid having to pay benefits.
  • Unauthorized payroll deductions for expenses like transportation, materials and tools.

There has been a push by some states and cities to address wage theft and misclassification of workers as independent contractors. In California, lawmakers are considering codifying a state Supreme Court ruling that sets the parameters of which workers qualify as independent contractors. The “ABC” test asks whether the person claiming to be an independent contractor is free from the control and direction of the employer; performs work that the hiring employer doesn’t typically do; and engages in the work as part of a business.

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Opinion: Criminalizing wage theft is only one step in the right direction (CO)

APR 29, 2019 4:05AM MDT
Rebecca Galemba

A day worked is a day paid,” a day laborer in Lakewood, Colorado stated. But according to the Colorado Fiscal Institute (CFI), this is not the case for many Colorado workers. Each year, half a million Coloradans suffer from wage theft, amounting to $750 million a year, in addition to the associated $25 million to $47 million in lost state tax revenue and potential public services.

Wage theft refers to the denial of earned wages and benefits protected under state and federal labor laws. The CFI numbers are likely vast under-estimates due to underreporting and pervasive worker misclassification.

New legislation, like Colorado House Bill 1267, would recognize wage theft for the insidious, and often intentional, crime it is. This legislation would treat wage theft as “theft” so that the intentional withholding of wages over $2,000 would be considered a felony.

When employers get away with cheating their workers, it not only harms Colorado’s most vulnerable people, but also undermines wages and working conditions for all workers and creates unfair business advantages for unscrupulous employers. When penalties are low or not applied, committing wage theft is relatively low-risk, profitable, and normal.

Recognizing the crime of wage theft is a step forward in mitigating this unfair business practice. House Bill 1267 can pave the way for more proactive policies to target routine violators, ramp up public enforcement, enhance retaliation protections, monitor industries with pervasive violations and create partnerships to assist workers who may lack the ability to come forward in a claims-driven enforcement environment.

In Colorado, the construction sector accounts for the largest share of violations of the Fair Labor Standards Act; it is estimated that a third of workers in construction may be misclassified, leading employers to avoid obligations to their workers as well as payroll taxes. In my research survey of over 400 day laborers, we found that 62% of workers surveyed had experienced wage theft, but that only half ever pursued their unpaid wages.

Fewer than 40% asked for assistance even though an amendment to the Colorado Wage Claims Act, which went into effect in 2015, authorized the Colorado Department of Labor and Employment’s Division of Labor Standards and Statistics to adjudicate wage claims and levy fines and penalties to deter bad behavior regardless of a worker’s legal status.

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‘Put The Exploiters In Jail’: Wage Theft Bill Cracks Down On Employers

By Shaun Boyd
April 2, 2019 at 6:40 pm

The Colorado Fiscal Institute says more than 500,000 Colorado workers are victims of wage theft each year, losing an estimated $750 million. And right now, there’s little prosecutors can do about it.

Under current state law, wage theft is a misdemeanor, no matter if it’s $100 or $100,000. Representatives Jonathan Singer and Meg Froelich plan to change that.

“When a hard day’s work is put in, an honest day’s pay is deserved,” said Singer.

He and Froelich have introduced a bill that would align wage theft with other thefts. If it’s over $2,000, it would be a felony.

“Wage theft is perpetrated against the most vulnerable workers,” said Froelich.

It is especially common in the construction and food service industries. Jim Gleason, a carpenter, says he was a victim.

“We were getting paid every week until about the 4th or 5th week and we were informed that there wasn’t enough money to make payroll so if we didn’t mind waiting a week, we’d pay for two weeks the next week,” he said. “Well, the next week came and there was no check. It’s time we put the exploiters in jail and got the penalties that they deserve and give the wages to the people who deserve them.”

The Colorado District Attorney’s Council agrees.

“Why is it that someone should face a greater penalty for stealing your cellphone then for having your wages stolen?” asked Boulder County District Attorney Michael Dougherty. “It is the exact same offense and should be treated the same under law and until we do so we’re going to allow immigrants and poor people in this state to be victimized.”

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As Colorado construction industry makes plans to hire 30,000, Denver is using its leverage to add local-hiring rules on projects (CO)

National Western Center’s $275 million site-prep contract is first to require outreach to lower-income areas

By JON MURRAY
PUBLISHED: June 25, 2018 at 7:00 am

The Denver metro area’s construction boom is about to intensify as upward of $4 billion in big projects get underway in the city, requiring a lot of hiring to fill jobs on building sites.

And for the first time, local leaders have used the city’s leverage on a large public contract to make sure residents of disadvantaged neighborhoods share in the thousands of new jobs. The City Council on June 11 approved a $275 million site-preparation contract – the first nine-figure deal for the National Western Center project – that requires Hensel Phelps Construction and its subcontractors to recruit heavily from the city’s six most economically disadvantaged ZIP codes, largely southwest and northeast of downtown.

For now, the requirements in the pilot program stop short of setting local-hiring quotas or even targets, and it’s considered a bit of a dry run.

But if the initiative is successful at training residents and placing them in project jobs, it could portend more aggressive steps by the City Council and Mayor Michael Hancock’s administration to extract local job benefits on some upcoming projects.

Construction is an industry flush with opportunity in coming years, both for entry-level jobs and those that require light training or apprenticeship programs, from masons to electricians to pipefitters. Starting wages for many jobs begin at $13 or higher.

The state’s industry employs about 175,000 workers, according to the Associated General Contractors of Colorado, and that’s slightly more than the pre-Great Recession peak in 2007. But a Colorado State University study has projected the industry will need to fill 14,000 more positions in the next five years, a figure that equates to hiring 30,000 new workers, once baby boomers’ retirements and other attrition are factored in.

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GOV. HICKENLOOPER SIGNS EXECUTIVE ORDER TO IMPROVE PAYROLL AND WORKER CLASSIFICATION IN CO CONSTRUCTION INDUSTRY (CO)

Office of the Governor
June 5, 2018

DENVER – Wednesday, June 6, 2018 – Gov. John Hickenlooper has signed an executive order creating a joint task force including employer and employee groups to better address payroll and worker misclassification in Colorado’s construction industry.

Misclassification of employees as independent contractors and other labor law violations disadvantage both law-abiding construction contractors and construction workers in Colorado. Some labor brokers within Colorado’s construction industry have been found to have purposefully misclassified workers to avoid paying unemployment premiums and payroll taxes.

“Law-abiding companies and workers are being undercut by those who skirt the law in Colorado,” said Governor John Hickenlooper. “This task force will bring all parties together to find the right solutions to root out any illegal labor activity in our state.”

“Payroll fraud in the construction industry hurts workers and honest businesses,” said Randy Thornhill, Executive Secretary-Treasurer, Southwest Regional Council of Carpenters. “The first step in tackling this issue is evaluating current enforcement practices. With this executive order, the governor’s commitment to building a better economy is clear. His leadership on these issues will lead to a cleaner industry and safer workplaces.”

The Joint Enforcement Task Force on Payroll Fraud and Employee Misclassification in the Construction Industry will coordinate with relevant state agencies to share information and streamline investigations around alleged misclassification of workers. The task force also will coordinate with business, labor and community groups.

“We are going to hit the ground running to convene key stakeholders in order to ensure across the board compliance with Colorado’s labor and employment laws, particularly in the commercial construction industry,” said Sam Walker, executive director of the Colorado Department of Employment and Labor. “Consistent and effective enforcement of our laws and regulations is a win-win for law-abiding companies and their workers. By collaborating with the other state agencies on this task force, as well as with workers and contractors within the industry, I know we’ll be able to identify areas for improvement so that our State’s labor and employment protections work as they should throughout Colorado’s booming construction sector.”

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