Date: 04/29/2014

Final
BILL SUMMARY for SB14-005

HOUSE COMMITTEE ON BUSINESS, LABOR, ECONOMIC, & WORKFORCE DEVELOPMENT

Votes: View--> Action Taken:
Adopt amendment L.013. The motion passed without o
Refer Senate Bill 14-005, as amended, to the Commi		Pass Without Objection
PASS



11:05 AM -- SB 14-005

The committee came to order. A quorum was present. Representative Singer presented Senate Bill 14-005, concerning alternative administrative remedies for the processing of certain wage claims. The bill authorizes the Division of Labor (division) in the Colorado Department of Labor and Employment (CDLE) to establish an administrative process to handle wage claim cases received and requires the division to investigate and adjudicate all wage claim cases up to $7,500 per employee—which represents the maximum sum in nearly all wage claim cases—after January 1, 2015. The bill outlines a series of required notices the division must send in writing and response deadlines for those notices. Upon a determination of a wage violation, the division is required to issue a citation and notice of assessment to the employer. An employer’s failure to respond within 14 days creates a rebuttable presumption of willful intent and makes the employer subject to increased penalties, payable to the employee.

The bill creates a fine of up to $50 per day of a wage violation, to be deposited into the newly created Wage Theft Enforcement Fund, which offsets the division's costs. In addition, employers are required to maintain employee wage records for three years, or be assessed a fine of up to $250 per employee per month. These fines can be waived by the division to encourage employer compliance, and are capped at $7,500. If an employer reimburses its employee for the full amount claimed, and the employee accepts the payment, the employee must dismiss any further action against the employer.

The bill includes an appeals process to be conducted by a hearings officer in the division. An employer’s failure to obey a subpoena issued by a hearings officer is a new misdemeanor offense punishable by a $200 fine, imprisonment in a county jail for up to 60 days, or both. A civil action can be filed in district court to dispute a hearings officer’s decision. The bill requires employers to mail a check to an employee’s last known address within 60 days after the check was due if the employee has not received his or her compensation. Finally, the bill allows for the recovery of reasonable attorney’s fees in actions to recover the minimum wage.

The sponsor responded to questions and commendations from the committee.

The following individuals testified on the bill:

11:13 AM -- Tony Gagliardi, representing the National Federation of Independent Businesses (NFIB), testified in opposition to the bill. He discussed his organization's concern that the bill would penalize employers for minor mistakes and make employers susceptible to unjust fines and penalties. He stated that there are already avenues in place for wage theft claims, including small claims court which requires no attorney. He stated his concern that when a fund is supported by fines, a higher levying of fines is common. He discussed the issue of employment brokers who "lease" employees to agricultural organizations. Mr. Gagliardi stated that he was authorized to testify against this bill on behalf of the Associated Builders and Contractors. The witness responded to questions from the committee.

11:23 AM

The witness continued to respond to questions from the committee about the stakeholder process on the bill, how this bill would affect small business, and the prevalence of the issue among his membership.

11:33 AM

The witness continued to respond to questions from the committee.

11:35 AM -- Susan Schaecher, representing the Colorado Restaurant Association (CRA), testified in opposition to the bill. She discussed the issues the restaurant industry, in particular, faces with its high rate of first-time employees who are more likely than seasoned employees to misunderstand payroll procedures and make wage theft claims. As an attorney, she said she had concerns about the processes under the bill and stated that the bill had inconsistencies. She responded to questions from the committee.

11:45 AM

Ms. Schaecher continued to respond to questions from the committee about CRA membership, current regulations on record keeping, and the potential for class-action lawsuits.

11:55 AM

The witness continued to respond to questions from the committee.

11:56 AM -- Dennis Coombs, representing the City of Longmont as Mayor and himself as a member of the CRA and owner of the Pumphouse Brewery, testified in support of the bill. Mr. Coombs stated that Longmont's city council supported the bill. He discussed the simplicity of the payroll process with automated Point-of-Sale systems. He stated that he had no fear of wage claims because of the ease of electronic payroll records. Mr. Coombs responded to questions from the committee.

12:02 PM -- Dave Lichtenstein, representing Plantiff Employment Lawyers Association (PELA), testified in support of the bill. Mr. Lichtenstein discussed the current system in place for wage theft claims. He said the bill would level the playing field. He explained the proposed administrative process under the bill. He stated that there is nothing in the bill that shifts the burden of proof from the employee to an employer in a wage theft claim. He addressed points made by the opposition.

12:08 PM -- Chelsea Blocklin, representing herself, testified in support of the bill. Ms. Blocklin discussed her personal experience with wage theft at a restaurant in Boulder County.

12:12 PM

Representative Singer distributed and discussed Amendment L.013 (Attachment A).

140429 AttachA.pdf140429 AttachA.pdf
BILL:SB14-005
TIME: 12:13:23 PM
MOVED:Kraft-Tharp
MOTION:Adopt amendment L.013. The motion passed without objection.
SECONDED:Rosenthal
VOTE
Exum
Hamner
Holbert
Navarro
Nordberg
Rosenthal
Ryden
Szabo
Wright
Kraft-Tharp
Williams
YES: 0 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: Pass Without Objection



12:13 PM

The sponsor made closing remarks.

BILL:SB14-005
TIME: 12:13:50 PM
MOVED:Kraft-Tharp
MOTION:Refer Senate Bill 14-005, as amended, to the Committee on Appropriations. The motion passed on a vote of 6-5.
SECONDED:Hamner
VOTE
Exum
Yes
Hamner
Yes
Holbert
No
Navarro
No
Nordberg
No
Rosenthal
Yes
Ryden
Yes
Szabo
No
Wright
No
Kraft-Tharp
Yes
Williams
Yes
Final YES: 6 NO: 5 EXC: 0 ABS: 0 FINAL ACTION: PASS




12:16 PM

The committee recessed for lunch.