Similar to the prior five years, 2023 brought unprecedented changes in labor and employment laws that have already gone into effect or are now in effect for 2024 in Colorado, across the country in other states, by National Labor Relations Board, and through the U.S. Supreme Court. Employers should be aware of the many legal shifts in employment law to ensure compliance and avoid potential liability. If not already considered, decision-makers with hiring and firing authority should contact and work with experienced employment counsel to seek advice and counsel, update workplace policies as well as managerial practices, and address out-of-date practices.

Colorado Employment Law: Enactments and Expansion (2018-2023)

Colorado has had perhaps the most updates to its employment laws and regulations of any state over the past five years. The Centennial State has enacted or made amendments to many employment laws. The Colorado Chance to Compete Act (C.R.S. § 8-2-130) prevents employers from inquiring about applicant’s criminal history in the initial application or barring persons with criminal histories from applying for a position. The Colorado Wage Payment Act, (C.R.S. § 8-4-101) strengthens penalties and expands definitions of wage theft. Create a Respectful and Open World for Natural Hair Act (C.R.S. § 24-34-301) amends the definition of race to include hair texture, hair types, and hairstyles commonly associated with race for the purposes of employment discrimination claims. The Sexual Orientation Employment Discrimination Act (C.R.S. § 24-34-402) incorporates gender identity and gender expression into statutes prohibiting discrimination against members of a protected class. The Colorado Healthy Families and Workplaces Act (C.R.S. § 8-13.3-401) requires employers to provide eligible employees at least one hour of accrued paid leave per 30 hours worked and in 2023 expanded the circumstances under which employees can use paid leave from five to eight different events. The COVID Public Health Emergency (PHE) Leave Requirement expired on June 8, 2023. The Colorado Paid Family and Medical Leave Insurance Act or “FAMLI” Act (C.R.S. § 8-13.3-501 et seq.) ensures employees to have access to paid leave of up to 12 weeks for parental bonding, medical care for self and family members, exigent leave for military family members and safe leave in domestic violence situations. The Restrictive Employments Agreement Act (C.R.S. § 8-2-113) drastically limits the classes of employees who can be bound by non-compete and non-solicitation agreements, the breadth of applicability of these agreements, and the notice requirements for employers hoping to enforce these agreements. The Collective Bargaining by County Employees Act (C.R.S. § 8-3.3-101) allows many county employees to unionize and collectively bargain. The Equal Pay for Equal Work Act (C.R.S. § 8-5-201) requires employers to publicize job opportunities to all current employees, including the pay, benefits, eligibility requirements, and application deadlines for the job opportunity. Employers are also required to announce the name and job titles of persons selected to fill these positions as well as to publicize career progression requirements. The Job Application Fairness Act (C.R.S. § 8-2-131) prohibits employers from inquiring about a prospective employee’s age in their initial application. The Wage Theft Act (C.R.S. § 8-4-113) creates a wage theft enforcement fund to directly repay employees who have been the victims of wage theft and to seek reimbursement from employers. The Colorado General Assembly will be specifically targeting the construction industry through a bill in 2024. The Protecting Opportunities and Workers’ Rights Act (C.R.S. 24-34-407) reduces standard of proof for workplace harassment claims and restricted employment-based non-disclosure agreements so as not to chill communication or reporting of any alleged discriminatory practices by the employer.

Other States’ Employment Law Changes Heading into 2024

• National Trend Limiting Non-Competes or Restrictive Covenants

For those public employers that are a part of projects or agreements that include restrictive covenants, the legal trend across the country is towards limiting or prohibiting non-compete agreements. Four states presently bar all employment-based non-compete agreements, including California, Minnesota, North Dakota, and Oklahoma. New York is expected to join this list. Maryland and Washington, similar to Colorado, has prohibitions based on employees’ annual income. At the federal level, various agencies are taking aim at non-compete agreements.

• Expansion of Anti-Discrimination and Pay Disclosure Laws

Michigan, Nevada, and Pennsylvania amended their laws governing employment discrimination, clarifying the statuses of sexual orientation, gender expression, and gender identity as protected classes. Minnesota may soon follow. Arizona, Arkansas, Minnesota, Michigan, Pennsylvania, and Texas joined more than a dozen (including Colorado) to pass CROWN acts, which prevent employers from discriminating on the basis of natural and cultural hairstyling practices. Several more states added age-discrimination, criminal history inquiries, and pay transparency measures including prohibiting employers from considering an applicant’s past salary when determining future compensation or benefits to their laws. We expect other states to follow with adoptions or amendments to pay and disclosure laws in 2024.

• Public Sector Collective Bargaining and Employee Health Benefits

In 2023, 24 states amended legislation or enacted bills related to public sector employees, notably in Colorado where most county employees were allowed to move forward with an elections and collective bargaining process.⁹

In addition to strengthening collective bargaining rights, many states expanded mandatory benefits for blue-collar workers in the private sector.

Major Supreme Court Decisions of Potential Relevance

In 2023, the United States Supreme Court issued two landmark decisions with widespread ramifications for employers. The first, deciding Students for Fair Admissions, Inc. v. President & Fellows of Harvard College and Students for Fair Admissions, Inc. v. University of North Carolina, et al ²⁸ did not directly concern employment law. Regardless, it may still have significant downstream consequences for employers seeking to diversify their workforce or to shield themselves from liability from discrimination claims. The second case, Groff v. DeJoy,²⁹ heightened the standard for employers to deny requests for religious accommodations. These two decisions are examined below, as well as one important case currently being considered by the Court that could transform the analysis of “adverse employment actions” in workplace discrimination lawsuits.

NLRB’s 2023 Changes in its Rules and Standards; Expansion of Violations

In 2023, the National Labor Relations Board (Board) expanded remedies available if an employer violates the National Labor Relations Act (NLRA) which may include providing notice and an explanation of rights to its workforce and other procedural mandates. Last year, the Board restricted the use of confidentiality and non-disclosure agreements (NDA) for non-supervisory employees. In the same vein, the Board’s General Counsel issued a memo to stifle the use of employee non-compete agreements (NCA) following the footsteps of the Federal Trade Commission (FTC) and opining that NCAs violation the NLRA except under special circumstances. The Board created a new standard to review an employer’s workplace policies and whether the policy could be reasonably interpreted to infringe on employees’ protected concerted activity. The Board also announced a final rule regarding its representation election procedures and an expedited timeline for union elections. The composition of the Board saw no changes in 2023, but it issued three notable decisions with far-reaching consequences. Two Board decisions addressed employers’ duty to bargain during contract negotiations, Wendt and Tecnocap.⁴⁷ Another, Mclaren Macomb,⁴⁸ limited employers’ ability to create severance agreements with terms that conflict with the NLRA.

Conclusion

Employment law in 2023 saw widespread expansion of employees’ rights in Colorado, numerous other states as well as through two landmark decisions in the Supreme Court. Employers and their decision-makers should ensure that their employment policies, rules, template agreements, and everyday practices that govern the workplace have been carefully reviewed by an experienced employment partner or team. Employers should also check the websites of their state’s civil rights divisions as well as the departments of labor for amended governing rules and procedures. Stay tuned for more employment law changes and enactments in 2024 as employees’ rights across the U.S. continue to expand.