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Last May, a Denver subreddit blew up with posts about remote job opportunities excluding Coloradans. In an attempt to avoid the state’s new pay transparency requirement, hundreds of companies indicated they were avoiding Centennial State hires. Within weeks, local and national media outlets, including the Wall Street Journal and The Atlantic, had picked up the story: “Many Companies Want Remote Workers—Except from Colorado.”
Pay transparency, specifically including pay or a pay range in job postings, is one of several requirements mandated by Colorado’s Equal Pay for Equal Work Act (Equal Pay), which passed in 2019 and took effect last January. Aimed at closing the gender pay gap, the law includes a variety of other mandates to even the playing field among workers: Notably, it requires employers to notify employees of promotion opportunities, keep record of all employees’ job descriptions and pay histories during employment and for two years after, and it prohibits employers from asking about a job applicant’s pay history.
Over the last year, however, the law faced its share of growing pains, according to Scott Moss, director of the Colorado Department of Labor and Employment’s (CDLE) Division of Labor Standards and Statistics, which enforces aspects of the law.
The struggles began even before the law took effect. In December 2020, Rocky Mountain Association of Recruiters (RMAR) filed a lawsuit against Moss to challenge his division’s rules, which interpret the law for enforcement. “It started out as a lawsuit about the rules, but it became clear, including in the association’s court filing, that it was a challenge to the act itself,” Moss says. (RMAR did not respond to requests for comment.) By early July, when news of companies dodging the law had received national attention, RMAR dropped the suit.
While not all companies are fans of the pay transparency requirement, that aspect of the law was at least better understood than other elements during the first year. Multiple sources 5280 spoke with expressed confusion about the promotion transparency requirement. “I don’t want to post a position that isn’t actually available,” says Marisa Daspit, chief people officer at Ibotta, a Colorado-based company that provides cash back to shoppers.
“All that’s required is that before a promotion is made final, there has to be a posting to all current employees [about the opportunity],” Moss clarifies. “A company can still have someone in mind and be grooming someone, it just has to do the promotion transparently.”
The law also affects wage disputes, sending them directly to court rather than through CDLE, and Rachel Beck, Vice President of Government Affairs for the Colorado Springs Chamber of Commerce (CSCC) expressed concern about text toward the end of the bill regarding such disputes. If the employer hasn’t faithfully kept the mandated records, the court may, according to the text of the law, instruct “the jury that failure to keep records can be considered evidence that the violation was not made in good faith.”
“Our justice system is predicated on a presumption of innocence,” Beck says, “and so to say that a lack of record keeping should be taken as evidence of a violation, that’s a huge problem.”
State Senator Brittany Petersen, a sponsor of the bill, says this provision aims to account for an imbalance between employers and employees. “It’s actually very common in labor laws to include what’s commonly known as a ‘rebuttable presumption’ to ensure that laws are adequately enforced,” she says. “Without this protection, the power imbalance between an employer and employee can interfere with getting to the truth and ensuring employees who were wronged are compensated fairly.”
Last summer’s news coverage and other concerns about the law have presented challenges to the economic development arm of CSCC, according to Beck: “If we are getting national press about companies avoiding posting jobs in Colorado, that’s devastating … for our national reputation.” She says her chamber has seen companies pull back from Colorado since the law took effect, though she didn’t provide any specific examples. “When I say, ‘Can I give your number to the reporter or the legislator?’ [the businessperson will] say, ‘Well, no, because I don’t want to look like the horrible business owner that opposes Equal Pay for Equal Work.’ ”
Remote work is particularly appealing to women, according to Simone Ross, CEO of the Colorado Women’s Chamber of Commerce (CWCC), so she finds the news of companies excluding Coloradans from remote work opportunities concerning. CWCC supports women entrepreneurs and workers, as well as businesses, and it coaches women to openly talk about pay because doing so can help them attain equitable wages. “We want these conversations to be happening, but we want them to be able to happen in ways that are not detrimental to providing opportunities for women and work,” Ross says.
Moss is familiar with these concerns, but he also says most large national companies already have a Colorado presence. Since the only jobs excluded from Colorado’s pay transparency requirements are those that either can’t be performed in Colorado (because they must be performed on-site somewhere else) or those posted by employers that have no Colorado presence, many of the companies barring Centennial State applicants last summer were actually violating the law.
The media coverage mobilized Moss’s division: His team hired a temp to scour the internet for errant job postings and began sending compliance assistance letters to the companies in question to inform them about the law and request compliance in lieu of an investigation. Since July, the division has contacted 128 employers and nearly 90 percent, Moss says, “have committed to bringing their remote job postings into compliance.” The division has only issued one ruling with no fine; the company addressed the issue and didn’t appeal.
Some companies, however, have seen the changes as a chance to get ahead of others. For Ibotta, which has complied with the law since it took effect, the question was never whether or not to abide by Equal Pay but how to treat the company’s non-Colorado jobs.“My team spent most of 2020 preparing for this law,” says Daspit. “[We were] thinking about how we were going to set [pay] ranges, what we were going to post … were we going to take a different position for jobs that were in New York or Chicago versus Colorado?”
While Oracle or Nike might currently omit pay ranges from non-Colorado roles, Ibotta decided to practice transparency for all of its jobs, regardless of location. This approach could prove helpful as other states across the U.S. adopt comparable laws: In December, New York City passed a bill requiring employers to include pay ranges in job postings. Connecticut, Nevada, Washington, and Rhode Island all have their own pay transparency laws on the books (Rhode Island’s will take effect in 2023). Similar bills are also in the works in other states.
There’s a clear movement across the country for greater pay transparency and workers’ rights, but Colorado’s Equal Pay law remains the most expansive. And while some initial hurdles have been worked out, the ultimate effect on the gender wage gap remains to be seen. Over time, Daspit says, “it will be interesting to measure, is that what was really necessary to solve some of the [equity] issues?” Or will states with less legislation achieve gender pay equity just as quickly?