Everything About Overtime Laws in Colorado

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No matter the state you’re in, you need to know what overtime laws apply to your company. Between federal and state-based regulations, it can be hard keeping on top of everything. But our team here at actiTIME are the experts, and we’re here to give you all the information you need to know about overtime laws in Colorado.

What Are the Overtime Laws in Colorado?

The Fair Labor Standards Act (FLSA) was passed in 1938 to guarantee various rights to workers, including overtime pay. Since then, Colorado has added their own regulations that only apply within the state. We will list them below, but if you haven’t checked out our primer on what overtime is and how it works, you should read that first.

It’s important to know what workweek your company has established. In Colorado, a work week is a set of seven days made up of 24 hours that can start on any day of the week a company requires. Each type of employee in the company (managers, cashiers, accountants) can have their own workweek regime so long as they remain consistent.

Colorado follows FLSA guidelines when it comes to the workweek: if an employee works for more than forty hours, they qualify for overtime. Employers cannot give them fewer hours the following week to compensate.

Yes
Week 1:
45 hours
Week 2:
35 hours
Total:
75 regular hours
+ 5 overtime hours
No
Week 1:
45 hours
Week 2:
35 hours
Total:
80 regular hours

In Colorado, there are extra laws that state how any hour more than 12 hours worked in a workday (a 24-hour period) must be compensated as overtime.

Yes
Day 1:
13 hours
Day 2:
8 hours
Day 3:
4 hours
Day 4:
7 hours
Day 5:
8 hours
Total:
39 regular hours
+ 1 overtime hours
No
Day 1:
13 hours
Day 2:
8 hours
Day 3:
4 hours
Day 4:
7 hours
Day 5:
8 hours
Total:
40 regular hours

In Colorado, as compared to most states, overtime can only be compensated by paying 1.5x an employee’s regular rate of pay. Compensatory time, which allows workers to take 1.5 hours of paid vacation for every hour worked as overtime, is not allowed.

There are some more factors that can impact how you calculate work hours:

Except in certain cases (nurses, paralegals), employers may require employees to work as many overtime hours as necessary so long as they are fairly compensated.

An additional limit of 80 hours for every 14 days is applied to workers at nursing homes and in hospitals.

Any extra related work, like shutting down equipment or traveling from one site to another, counts towards one’s work hours.

If an employee has to wait for a task to begin, then that time counts towards their hours.

Work done on weekends or holidays is not automatically counted as overtime.

How Do I Calculate Overtime Pay in Colorado?

While there are a number of factors that can change the equation, the basics of calculating overtime pay rates are simple.

Colorado employees are entitled to a minimum wage of $12.00 an hour, which amounts to a base overtime pay of $18.00 an hour. A minimum wage worker might have a pay month that looks like this:

Week 1:
Week 2:
Week 3:
Week 4:
Regular hours:
Overtime hours:
Total:
32 hours (32 regular)
47 hours (40 regular + 7 overtime)
26 hours (26 regular)
43 hours (40 regular + 3 overtime)
138 x $12=$1656
10 x $18=$180
$1836

Once you get used to it, calculating regular and overtime rates are simple enough. But there are a few more factors that you need to account for.

The first one is commission. For employees who work in sales, commission can make up a large part of their salaries, and so you will need to do some extra calculations to confirm what a worker’s regular and overtime pay will be for a given period.

Working out an employee’s regular pay means tracking the commission earned that week before combining it with their regular salary. Then you divide it by the hours they worked. If a salesperson makes minimum wage plus commission, the calculation might look like this:

Week 1:
Regular pay:
36 hours x $12 ($432) + commission ($200)=$632
$632 / 36=$17.56

A week where they worked overtime might give a calculation like this:

Week 2:
Regular pay:
Overtime pay:
Total regular hours:
Total overtime hours:
Total:
44 hours x $12($528) + commission ($250)=$778
$778 / 44=$17.68
$17.68 x 1.5=$26.52
40 x $17.68=$707.20
4 x $26.52=$106.08
$813.28

The second factor to keep in mind are bonuses. In certain cases, especially if your employees receive non-discretionary bonuses, you’ll have to keep them in mind when calculating someone’s regular pay rate. To do so, you take the amount earned as per a worker’s base pay rate over the course of a bonus period and then add that number to the bonus. Divide that number by the hours worked and you will get the employee’s regular pay.

If the worker earns minimum wage for 160 hours with a monthly bonus that, this time, is worth $1000, then this will be their calculation:

160 hours x $12 = $1920

Regular hours: ($1920) + bonus ($1000) = $2920  
Regular rate: $2920 / 160 = $18.25
Overtime rate: $18.25 x 1.5 = $27.38

Now you can use their regular pay rate to find out how much overtime pay an employee has earned in a given month

Week 1:
Week 2:
Week 3:
Week 4:
Total:
36 hours (36 x $18.25) = $657
47 hours (40 x $18.25 [$730] + 7 x $27.38 [$191.66]) = $921.66
40 hours (40 x $18.25) = $730
37 hours (37 x $18.25) = $675.25
$2983.91

In Colorado, there are two more factors to keep in mind: piece rate payment and tipped employees.

If an employee is paid for each piece produced or service rendered, then the number earned from these is added together and divided by the total number of work hours that week, plus their base pay.

Tips aren’t counted towards overtime. That said, even though workers who earn tips can be paid less than the official minimum wage (down to a minimum of $8.98), any overtime incurred is paid out at the rate of 1.5x the official minimum wage ($12 x 1.5 = $18).

If one employee works in two different positions that earn different wages, overtime is calculated at the rate of the position the worker was occupying at the time overtime is incurred.

Need help while figuring overtime pay amounts for your team members? Consider using actiTIME overtime calculatorWeve made it to assist you in the clculation process, speed it up and make it more accurate. 

Who Is and Isn’t Qualified for Overtime Pay in Colorado?

The FLSA does not provide all workers with the right to overtime pay. The laws were written to protect certain employees from exploitation, particularly manual laborers. In order to qualify for overtime pay rates, employees must be covered by the Colorado Minimum Wage Order Number 33.

One of two additional conditions must be met for Colorado employees to be paid overtime;

  • Their weekly earnings must be under $455 a week (or $23,660 a year)
  • They cannot work in an industry that’s exempt from overtime laws (see below).

The FLSA automatically grants overtime pay to manual laborers like construction workers, factory workers, warehouse stockers and others. Paralegals and nurses also qualify, as do first responders like police officers, firefighters and paramedics.

Ski industry workers are exempt from the right to take overtime when working over 40 hours in a workweek. Similarly, medical transport personnel do not make overtime when working over 12 hours in a workday.

According to the FLSA and Colorado state law, certain types of employee can’t claim overtime pay if they make more than $455 a week:

Executives
Executives (who manage more than two people full-time);
Administrative workers
Administrative workers;
Non-manual professional workers
Non-manual professional workers (artists, teachers, programmers);
External salespeople
External salespeople who spend at least 80% of their workweek on tasks that are connected to their outside sales;
Elected officials
Elected officials and their staff;
Independent contractors
Independent contractors;
Computer-related professions
Computer-related professionals who make more than $27.63 an hour;
Salespeople 75%
Salespersons whose salaries are made up of commissions by at least 75%;
Property managers
Property managers;
Agricultural employees
Certain agricultural workers;
Trailer salespeople
Trailer, boat and aircraft salespersons;
Taxi drivers
Interstate and taxi drivers, driver assistants, loaders or mechanics of motor carriers;
Employed students
Students either employed by fraternities, sororities or domatories, or ones participating in a work-study program;
Charity workers
Workers in charitable institution laundries which don’t pay wages to inmates and employees;
Live-in workers
Certain live-in employees.

If you have additional questions about whether or not an employee qualifies, please consult the FLSA.

Track Overtime Using actiTIME!

Colorado laws differ from many other state laws around the country, and keeping track of them is key to making sure your workers are paid fairly.

But it doesn’t have to be a headache – our full suite of services at actiTIME is here to make sure the process is as painless as possible. Read on to find out more.

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