First Regular Session Seventieth General Assembly STATE OF COLORADO INTRODUCED LLS NO. 15-0797.02 Bart Miller x2173 HOUSE BILL 15-1331 HOUSE SPONSORSHIP Tyler, Buckner, Esgar, Fields, Foote, Hullinghorst, Lebsock, Lontine, Melton, Primavera, Ryden, Salazar, Singer, Winter SENATE SPONSORSHIP Merrifield, House Committees Senate Committees State, Veterans, & Military Affairs A BILL FOR AN ACT Concerning increasing the minimum salary rate for employees exempt from overtime, and, in connection therewith, limiting the discretion of the director of the division of labor in the department of labor and employment in creating an exemption to Colorado's regulatory overtime requirements for employees that are administrative, executive, supervisor, or professional. Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://www.leg.state.co.us/billsummaries.) The bill limits the discretion of the director of the division of labor (director) in creating an exemption to Colorado's regulatory overtime requirements for employees that are administrative, executive, supervisor, or professional. The bill sets a minimum salary requirement for the director to apply the exemption equaling three times the Colorado minimum wage. For example, at the current minimum wage of $8.23 per hour, an employee that is an administrative, executive, supervisor, or professional making less than a weekly salary of $987.60 ($8.23 x 40 hours x 3 = $987.60) could not be exempted from overtime by the director's rules. Because the Colorado state minimum wage automatically adjusts for inflation under the Colorado constitution, by linking the minimum salary for the exemption to apply to minimum wage, that salary will also adjust with inflation. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. Short title. This act shall be known and may be cited as the "Colorado Overtime Fairness for Employees Act". SECTION 2. In Colorado Revised Statutes, 8-6-103, add (2.5), (5.5), and (8) as follows: 8-6-103. Definitions. As used in this article, unless the context otherwise requires: (2.5) "Administrative employee" means a salaried individual that directly serves the executive and regularly performs duties important to the decision-making process of the executive. The administrative employee regularly exercises independent judgment and discretion in matters of significance and has a primary duty that is nonmanual in nature and directly related to management policies or general business operations. (5.5) "Executive or supervisor" means a salaried employee earning in excess of the equivalent of the minimum wage for all hours worked in a workweek. The executive or supervisor must supervise the work of at least two full-time employees and have the authority to hire and fire, or to effectively recommend those actions. The executive or supervisor must spend a minimum of fifty percent of the workweek in duties directly related to supervision. (8) "Professional" means a salaried individual employed in a field of endeavor who has knowledge of an advanced type in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction and study. The professional employee must be employed in the field in which the employee is trained to be considered a professional employee. SECTION 3. In Colorado Revised Statutes, amend 8-6-106 as follows: 8-6-106. Determination of minimum wage and conditions. The director shall determine the minimum wages sufficient for living wages for persons of ordinary ability, including minimum wages sufficient for living wages, whether paid according to time rate or piece rate; the minimum wages sufficient for living wages for learners and apprentices; standards of conditions of labor and hours of employment not detrimental to health or morals for workers; and what are unreasonably long hours. In all such determinations, the director shall be bound by the provisions of this article and of section 15 of article XVIII of the state constitution; except that, if a higher minimum wage rate is established by applicable federal law or rules, the director shall be bound by such federal law or rules. The director shall not exempt any employee from any minimum wage or overtime requirements because the employee is an administrative, executive, supervisor, or professional unless the employee is paid on a weekly salary basis at least one hundred twenty times the state minimum hourly wage rate or, at the discretion of the director, a greater salary. SECTION 4. Act subject to petition - effective date - applicability. (1) This act takes effect at 12:01 a.m. on the day following the expiration of the ninety-day period after final adjournment of the general assembly (August 5, 2015, if adjournment sine die is on May 6, 2015); except that, if a referendum petition is filed pursuant to section 1 (3) of article V of the state constitution against this act or an item, section, or part of this act within such period, then the act, item, section, or part will not take effect unless approved by the people at the general election to be held in November 2016 and, in such case, will take effect on the date of the official declaration of the vote thereon by the governor. (2) This act applies to overtime wages paid to employees that are administrative, executive, supervisor, or professional on or after the applicable effective date of this act.