COMP NEWS – The Colorado Department of Labor and Employment has issued a formal opinion on the state’s Equal Pay for Equal Work Act. The notice clarifies that the law in question extends to any employers that employ residents in the state of Colorado, even if those residents’ jobs are fully remote.

When Colorado’s Equal Pay for Equal Work Act (“EPEWA”) went into effect at the beginning of 2021, Colorado became the first state in the U.S. to require employers to disclose compensation (or a range of compensation) in its public job postings. The far-reaching job-posting requirements, intended to combat pay discrimination, have had some unintended consequences. Most notably, the law has made national headlines as some employers have attempted to avoid the compensation-posting requirements by excluding Colorado workers from applying to remote job listings with phrases like “the position may not be performed remotely from Colorado” or “role can be performed anywhere in the United States except Colorado.”

What this essentially means is that if any employer in the United States employees even one worker from the state of Colorado, that employer is now subject to the state’s Equal Pay for Equal Work Act.

A 20,000-employee organization could suddenly find themselves complying with the EPEWA for all its workers if they added just one employee from Colorado to their ranks.

Companies had previously tried to avoid this scenario by specifying that applicants from Colorado would not be considered for positions posted. This tactic will no longer work, as explicitly noted in the Interpretive Notice & Formal Opinion (“INFO #9”).

If an employer posts a remote job (i.e., a job that could be performed anywhere), it must include compensation and benefits information. According to INFO #9, “a remote job posting, even if it states that the employer will not accept Colorado applicants, remains covered by the Act’s transparency requirements.” The CDLE has clarified that a remote job excluding Colorado applicants would not fall into the narrow exception for out-of-state worksites.

Though the legislation aims to protect workers’ rights to seek transparency in compensation, it could instigate an even deeper aversion to national employers seeking applicants from the state. Such a move could potentially hurt Colorado employees seeking fully remote work.

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