On July 8, 2021, Colorado ended the state’s COVID-19 public health emergency. However, Colorado employers must continue to provide COVID-19 sick pay while the Federal public health order remains active.
Per Colorado’s Healthy Families & Workplaces Act (HFWA), the requirement for all employers to provide COVID-related sick pay continues for 4 weeks following the end of a declared emergency. The Colorado Department of Labor & Employment (CDLE) will post an update on its HFWA website when the current PHE is ending and when the 4-week end period will begin.
What is Public Health Emergency Leave (PHEL)?
Public Health Emergency Leave (PHEL) was implemented in 2021 under the Colorado Families & Workplaces Act (HFWA). PHEL requires Colorado employers – regardless of size – to provide paid leave for qualifying absences during a declared public health emergency. This sick pay mandate expires 4 weeks following the end of the emergency public health order.
Colorado’s public health emergency ended July 8, 2021. Why must employers still provide COVID-19 sick pay?
This is where things get confusing. Colorado’s state law requires PHEL during a local, state, or federal public health emergency. Since we are still under a federal public health order, Colorado employers must continue paying PHEL.
As our friend and employment law attorney Michael Santo further explained:
“Under the Colorado Healthy Families and Workplaces Act, on the date a public health emergency is declared, all employers must make 80 hours of paid sick leave available to employees for purposes related to the public health emergency. This mandate extends through the duration of the public health emergency declaration, plus an additional four weeks after the public health emergency has been suspended or ended . . . [T]he statute defines ‘Public Health Emergency’ as a declaration by a ‘state, federal, or local health agency.’
So, while it is true that Governor Polis, as of July 8th, 2021, ended the health emergency declaration, the federal Department of Health and Human Services (“DHHS”) has an active ‘Determination That a Public Health Emergency Exists’ [that it renewed on July 19th] . . . [E]mployers may be obligated to continue providing leave under PHEL for some time.
. . . Governor Polis’ declaration is only one part of a larger picture when we are talking about PHEL. Further, local authorities may also extend employer’s obligations under PHEL, so stay tuned to your local news outlets and watch for any relevant activity. And don’t forget, employers are obligated to continue to provide PHEL for four weeks after the expiration of the last federal, state, or local state of emergency.”
Are you in compliance with PHEL?
- Review and update your sick leave policies per HFWA requirements.
- Review and update your time-off policies to ensure compliance with CO HFWA.
- Read ASAP’s Time-Off Policy Best Practices article for helpful tips and considerations
Next steps for ASAP’s payroll clients
- Connect with your ASAP account manager. They can answer any questions you have about sick pay and federal payroll credits, and help you with payroll and tax reporting requirements. Ask them about ASAP’s Sick Leave Policy template (available for a small fee).
- If you’ve made changes to your sick leave policy, inform your account manager right away. We can’t update time-off accruals in our payroll software without your notification and a follow-up discussion to capture additional details. Recordkeeping compliance starts with you.
Sources
- 7 CCR 1103-7 Wage Protection Rules (adopted April 14, 2021)
- “Are we there yet?” Gov. Polis’ July 8th Declaration and the Status of Public Health Emergency Leave Under the Healthy Families and Workplaces Act (posted July 9, 2021)
Time-Off Policy FAQS
If you are in a state, county, or city that requires Employers to offer paid sick leave and you decide to offer it as part of an overall PTO plan instead, it is critical that you ensure the plan meets all the requirements of the mandatory sick leave law or ordinance.
These requirements usually include letting employees use their time in small increments (e.g., one or two hours), ensuring that they accrue PTO fast enough, and allowing carryover into a new year. If you’re in one of these areas, you’ll definitely want to take a close look at the law or ordinance to ensure your PTO program is compliant.
For example, with the Colorado HFWA, paid sick leave does not require additional leave if an Employer policy provides fully paid leave for both sick and non-sick leave purposes (e.g., sick time and vacation) and makes clear to employees, in a writing distributed in advance of an actual or anticipated leave request, that:
- its leave policy provides PTO
- (1) in at least a number of hours and amount of pay sufficient to satisfy the paid sick leave law,
- (2) for all the same reasons covered by the paid sick leave law (not a narrower set of reasons), and
- (3) under all the same conditions as under the paid sick leave law, not stricter or more onerous conditions (e.g., accrual, use, payment, carryover, notice, documentation, anti-retaliation);
- additional paid sick leave will not be provided when an employee uses all PTO for reasons that don’t qualify for sick leave (e.g., vacation).
The paid sick leave law does not invalidate collective bargaining agreements that provide equivalent or more generous paid leave.
Regardless of which benefits you offer, you’ll want to make sure they are clearly articulated in writing and that all employees are made aware of what is available and how the policies operate.
If the differing amounts of vacation are based on clearly defined employee groupings, such as seniority, department, or exempt versus non-exempt status, then you can offer differing paid time off benefits based on these segments.
Where you can run into trouble is offering different amounts of vacation on an individual basis or without clearly defined criteria, either of which can lead to discrimination claims. For example, if Joe and Sandya are hired at the same time for similar jobs in the accounting department at the same rate of pay, but the organization offers Joe more vacation, Sandya could potentially bring a claim under federal or state discrimination or pay equity laws.
To be more specific, Employers are not required to pay out sick leave upon separation of employment. However, Employers are required to pay out any vacation balance. Vacation pay is considered as vested wages earned and thus required to be paid out upon separation.
This is all the more reason to offer, track, and manage paid vacation separately from paid sick leave.
With Accrual, employees accumulate a given number of paid-leave hours per pay period, or sometimes per hours worked. If your organization is cost conscious or has high turnover, accrual may be the best method for you. The downside can be the administration, UNLESS you are tracking accruals with your payroll processor.
The front load, or lump sum, is an approach to alleviate some of the administrative burden, but it can also cause some HR headaches. For example, an employee uses all of their time off at the beginning of the year and then leaves the company. Or worse, an employee could be entitled to that benefit as earned wages and therefore due all of that time off payment upon separation.
While some Employers may try to charge the employee (or deduct) on their final paycheck, not all states allow you do this. Additionally, If the time-off allotment is set to happen January 1st for all employees, that may cause additional questions and confusion for employees who are hired mid-year versus those hired in December and what that means for their accruals.
We recommend using the accrual method as this presents less room for errors and HR headaches. Here’s a good example:
| Length of Service | Current Annual Vacation Benefit | Accrual Per Pay Period |
|---|---|---|
| 0 to 3 months | 0 days | 0 hours |
| 4 to 23 months | 5 days per year | 1.53846 hours |
| 24 months and over | 10 days per year | 3.07692 hours |
TIP: As a payroll processor, we especially appreciate the length of service in months as payroll software can track most accurately.
Unfortunately, there is no industry standard, and thus businesses are left determining their own renditions of a time-off program. This lack of standards makes it tricky to create a solid policy that works for both the employee and the organization, as well as alongside your payroll processing platform. With ASAP Accounting & Payroll servicing over 900 small businesses, we’ve seen our fair share of both good and not-so-great time-off policies.
Attributes of a good time-off policy:
- It’s attractive to employees; after all, seeking and keeping top talent is challenging in today’s labor market.
- Make it understandable: Is it clear how time is tracked/accrued? Are there restrictions or limits? Does it carry over from one year to the next? And if so, how much carryover? Does accrual start at beginning of employment? Is there a waiting period before employees can use it? Is it given in one lump sum at the beginning of year or accrued with each payroll?
And for you, the Employer….
- Make it easy to calculate time-off alongside compensation
- Integrate time-off with payroll processing. For example, accruing amounts per hour worked or per pay period are specific and usually easily managed within your payroll system.
We also recommend unpacking these policies from your overall Employee Handbook, as these benefits in particular may change more frequently than your employment policies. It’s perfectly okay to have a combination of policies rather than one novel-sized handbook. Having a concise and clear Time-Off Program with enclosed policies allow team members to easily reference anytime.
ASAP’s HUB clock can do more than just track time — it can help you manage PTO requests and approvals as well as track with each payroll. >>Ask your ASAP Account Manager how HUB can help you better manage PTO.
Another great tool is a shared company or department calendar, which allows your team to see everyone’s time off. This way, hopefully employees won’t plan vacation if they see the team is already short-handed with others out.
