What Are the Colorado Overtime Laws?
According to the Colorado Minimum Wage Order Number 28, there are situations where employees would qualify for what’s commonly called overtime pay.
What’s overtime pay? The Colorado overtime laws are as such:
1. Overtime Calculations According to Colorado Overtime Laws
2. Workweek Definitions for Colorado Overtime Laws
3. The Law of a “Regular Rate of Pay”
Pay close attention, because these specifics on the Colorado overtime laws may differ quite a bit from other states:
Starting With the Overtime Calculations on Colorado Overtime Laws
The calculative standard does apply when it comes to overtime for workers: overtime is 1 ½ times the regular rate of pay. An example would be a regular wage of $6 per hour would have overtime if applicable of $9 per hour for every hour of overtime.
It’s important, though, to understand that Colorado specifically states as law that overtime can legally be applied to these three situations:
1. Excess of 40 Hours Per Workweek
2. Excess of 12 Hours Per Workday
3. Excess of 12 Consecutive Hours Per Workday (Excluding Duty-Free Meal Periods)
By law, the greatest amount of the three is considered for overtime.
In Colorado, What Is Considered a ‘Workweek’?
A workweek in Colorado is considered a 7-day period. Typically, it starts on the same day and hour – for instance, Sunday on 9 AM to Sunday on 9 AM would be considered a ‘workweek.’
Another way of thinking about it would be to see a workweek as a fixed period of hours totaling 168 – that would be seven consecutive 24-hour shifts. How those hours are divvied up for employees would be up to the discretion of the employer.
It’s also crucial to know that in Colorado hours averaged for overtime cannot amount to two or more workweeks. At the most, overtime must be calculated weekly.
The Regular Rate of Pay Standard
This is paramount to understand, in that the “regular rate of pay” by Colorado law is characterized by a rate per hour. Overtime is then calculated by dividing the total wages in any given workweek by the hours actually worked for that specific workweek.
Because of this, it’s actually possible to determine overtime for something other than an hourly rate: such as piecework, salary, or even commission. As long as an employee logs hours in and keeps an eye on the paycheck, it’s possible that overtime can be allowed under Colorado law.
That regular rate of pay can also include these factors:
1. Shift Differentials
2. Non-Discretionary Bonuses
3. Production Bonuses
Under Colorado law, though, you can expect these factors to not be included in the regular rate of pay standard:
1. Business Expenses
2. Bona Fide Gifts
3. Discretionary Bonuses
4. Employer Investment Contributions
5. Vacation Pay
6. Holiday Pay
7. Sick Leave
8. Jury Duty
Here’s an example of how a worker can determine overtime with a salary:
Let’s say the worker does a job at a salary of $30,000/year. Roughly, that’s about $625 per week.
Let’s say the worker by chance pulled in about 50 hours in that week. That’s 10 hours of overtime according to Colorado law.
What the worker has to do then is divide the number 625 with the total number of hours worked, which is 50. The result is $12.50 an hour. That would be considered the “regular rate of pay” for this particular salary.
Now that you have that regular rate of pay, you take half of that and apply it to the overtime hours worked. $6.25 an hour for 10 hours of overtime. The total would be $62.50.
Simply add the $62.50 as overtime pay onto the regular rate, which is $625 for that week, and that’s all you need to do to figure out your overtime. The total for that check would be $687.50.