Colorado Laws on Final Paychecks

by Grace Ferguson; Updated September 26, 2017
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The U.S. Department of Labor, which administrates the federal labor laws, does not require employers to give employees their final paychecks immediately upon separation. However, the state may have its own wage and hour laws, which includes regulations for final paychecks. Colorado is one of these states. The Colorado Department of Labor and Employment, Division of Labor, administrates Colorado’s final paycheck laws.

Identification

Colorado is an at-will state, which means that neither the employer nor the employee has to give notice of termination or a reason. In rare cases, exceptions may apply. The employer, for example, cannot terminate for discriminatory reasons, such as age, religion, gender, or sexual orientation, or for reasons that violate public policy, such as if the employee files a worker’s compensation claim or threatens to file a lawsuit.

Employer Termination

If a Colorado employer terminates an employee, the Division of Labor requires it to pay wages due immediately. A few exceptions apply. If the employer’s payroll/accounting department responsible for issuing payroll checks is inoperable on the day of the separation, wages are due by the sixth hour after the department becomes functional. If the payroll/accounting department is off-site, wages are due no more than 24 hours after the start of the department’s next regular workday. Payment can be made to the work site or the employer’s local office, or mailed to the employee’s last known address. The employer chooses the location of payment. If a check is mailed, it must be postmarked within the specified time frames.

Employee Termination

If the employee quits or resigns, wages are due by his next regularly scheduled pay date. The employer can make the payment by check, cash or direct deposit. Colorado’s Division of Labor views an employee who does not show up for work as scheduled as having quit or resigned.

Allowed Deductions

The employer can make permissible deductions from an employee's final paycheck. If a salaried employee quits, for example, the employer can pay her only for days worked during the pay period, instead of her full salary. If a terminated employee owes monies or property to the employer, the employer can deduct the value of the debt from her final paycheck. Colorado employers have 10 calendar days after the separation date to review the value of entrusted property and modify payroll accounts before paying wages due.

Considerations

Terminated employees who do not receive proper compensation of final wages can contact Colorado’s Division of Labor. The division acts as a mediator between the employer and the employee. It does not, however, have the legal authority to order payment of wages. If the mediation proves unsuccessful, the division may provide the employee with additional options, such as filing a lawsuit.

About the Author

Grace Ferguson has been writing professionally since 2009. With 10 years of experience in employee benefits and payroll administration, Ferguson has written extensively on topics relating to employment and finance. A research writer as well, she has been published in The Sage Encyclopedia and Mission Bell Media.

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