Colorado General Assembly Passes Bill Expanding Enforcement of Wage & Hour Laws
Colorado General Assembly Passes Bill Expanding Enforcement of Wage & Hour Laws
Bayan Biazar, Associate
The Rocky Mountain Employer has been tracking the status of House Bill 25-1001 (“HB-25-1001”) since it was first introduced in the Colorado General Assembly.[1] As of May 6, 2025, HB25-1001 has passed through the General Assembly (with notable changes from its original version, discussed below) and, if signed into law by Governor Polis, will create even more exposure for employers for wage and hour violations under Colorado law by expanding the definition of “employer;” by expanding employer accountability; by requiring a court to find that an employee pursued a wage claim that lacked substantial justification before awarding an employer reasonable costs and attorneys’ fees; and by expanding avenues of recovery against employer retaliation and discrimination, among myriad other things.[2]
House Bill 25-1001
HB25-1001 expands accountability for who can be found to have committed wage theft by amending and changing the definition of an “employer” under the Colorado Wage Act. The new definition includes any individual who owns or controls at least 25% of the ownership interests in any employer. The original version of HB25-1001 did not provide for any exceptions to this newly drafted “employer” definition. However, HB25-1001 carves out one notable exception. Under the exception, if a person is a minority owner of an employer who can demonstrate that he or she has fully delegated authority to control the day-to-day operations of said employer entity, the person will not be held accountable for wage violations the employer is found to have committed.
If HB25-1001 is signed into law, an employer may find it even more difficult to recover reasonable costs and attorneys’ fees even if it ultimately prevails on a wage claim. In order to award costs and attorneys’ fees to a prevailing employer, courts will need proof that the employee or worker pursued a wage claim which lacked “substantial justification.” The original version of HB25-1001 would have essentially eliminated all recourse for employers to potentially recover costs and attorneys’ fees expended in defending against bad faith wage demands, so the revisions to HB25-1001 provide employers at least some limited recourse. However, the current version of HB25-1001 also permits aggrieved persons to pursue equitable relief in addition to any claims for damages and penalties, including relief to deter future violations and prevent their employers from being unjustly enriched, without regard to exhaustion of any administrative remedies.
HB25-1001, as passed, also dramatically expands employee protections and remedies against retaliation. Under current Colorado law, an employer is prohibited from discriminating against or retaliating against an employee for asserting their rights under wage and hour laws. HB25-1001 expands these prohibitions on discrimination and retaliation for someone who is not just an employer, but rather, any other person that is regularly engaged in business or commercial activity that has contracted with an employer or worker, directly or indirectly, for labor from which such person is a beneficiary. HB25-1001 also expands the damages that an employer may face and the recovery that an employee or worker may gain if retaliation is proven. An employee or worker can now recover compensatory damages for other economic or noneconomic loss or injury shown by competent evidence and can also recover damages for emotional distress. HB25-1001 has also expanded the considerations a fact-finder may make when determining whether there has been a retaliation. Under the new HB25-1001 provisions, if an employer commits an adverse action against an employee within a period of ninety or fewer days between the employee or worker’s wage claim or protected activity, the employer’s action may, without the need for more evidence, be sufficient to find retaliatory intent for purposes of liability. Finally, the expansion on prohibition states that, if there is any effort by an employer to use an individual’s immigration status to in any manner discriminate or retaliate against that same employee or worker, there will essentially be an automatic finding of retaliation and/or discrimination.
Employer Considerations
HB25-1001 has now been passed and is waiting to be signed into law by Governor Polis. It will be interesting to see how the Governor reacts to these new provisions and whether he signs this version into law (Governor Polis previously vetoed the General Assembly’s prior attempt to enact similar legislation last year). If the bill does become law, it will go into effect on August 6, 2025. Given the significant changes that HB25-1001 is close to implementing, Campbell Litigation will continue to closely monitor HB25-1001’s status and will update the Rocky Mountain Employer accordingly.
[1] https://www.rockymountainemployersbi..g.com/blog/2025/2/6/colorado-lawmakers-take-another-shot-at-confronting-wage-theft-with-new-bill.
[2] See https://leg.colorado.gov/sites/default/files/documents/2025A/bills/2025a_1001_enr.pdf for the full text of HB25-1001.