In June 2023, Governor Jared Polis signed into law the Protecting Opportunities and Workers’ Rights (“POWR”) Act, dramatically altering Colorado’s antidiscrimination law, and presenting a host of new challenges for employers. The new law went into effect on August 7, 2023. This article covers the major aspects of the law, and best practices for ensuring compliance.
New Standard for Harassment
Historically in Colorado, to make out a claim for harassment, an employee had to show that the conduct was “severe or pervasive.” This was a difficult standard to meet, as it required employees show that their work environment was “permeated” with discriminatory intimidation, ridicule, and insults. Petty slights, minor annoyances, and isolated incidents were not sufficient.
The POWR Act scraps the severe or pervasive standard and replaces it with a new rule: harassment is legally actionable if it is (a) unwelcome (b) directed at an individual because of their membership in a protected class, and (c) subjectively offensive to the individual and objectively offensive to a reasonable person in the same protected class. The Act states that the type of work and the frequency of harassment have no bearing on whether the objective standard is satisfied. Under the new law, even a single incident can constitute unlawful harassment. Notably, the law uses a modified objective standard by asking whether a reasonable person in the same protected class would find the conduct offensive. It is unclear how this modified reasonable standard will affect how harassment claims are analyzed.
Action Items: Review your EEO and anti-harassment policies to ensure they are up to date and drafted to comply with the new law.
Limitations on Affirmative Defenses for Harassment
The POWR Act also makes it more difficult for employers to assert an affirmative defense against a claim of harassment by supervisors. Employers must now show that they had a program in place designed to prevent harassment, that the program was communicated to employees, and that the employee bringing the claim unreasonably failed to take advantage of the program. Additionally, employers must take prompt and reasonable action to investigate, address, and remediate complaints of discrimination and unfair employment practices.
Action Items: Review your employee handbook to make sure you have clear, easy-to-use procedures in place for reporting discrimination and harassment. Make sure all employees (including managers) are trained on how to use these reporting procedures. Designate an individual as the company’s “EEO compliance officer” and task that individual with managing the company’s harassment and discrimination complaint process. Provide alternative reporting avenues to employees, such as a complaint hotline, so they have multiple ways of reporting issues.
Limits on the Use of Nondisclosure Provisions
The POWR Act prohibits nondisclosure agreements that “limit the ability of the employee or prospective employee to disclose . . . any alleged discriminatory or unfair employment practice,” unless certain stringent requirements are met. These requirements include, among other things, the requirement that the nondisclosure obligation apply equally to the employer and the employee, carveouts for disclosures related to unlawful employment practices, and a separate addendum signed by all parties. Employers who violate these requirements are liable for actual damages and a penalty of $5,000 per violation. Any employee presented with a non-compliant agreement can immediately sue his employer to recover penalties, actual damages, reasonable costs and attorney fees, and punitive damages.
Action Items: Revise your nondisclosure agreements to comply with POWR’s new requirements. Make sure the agreements state they are not intended to limit employees’ ability to disclose information regarding discrimination and unfair employment practices.
New Record-keeping Requirements
The POWR Act also requires employers to preserve personnel and employment records for at least five years. This includes
- All job applications submitted by applicants (regardless of whether the individual was hired)
- Employee complaints
- Requests for accommodations
- All records related to personnel decisions (e.g., hiring, firing, transfer, etc.), compensation, and training
Additionally, employers must keep a “designated repository” for all written and oral complaints of discrimination and unfair employment practices. For each complaint, the employer must document and keep (a) the date of the complaint, (b) the identity of the parties involved, and (c) a description of the substance of the complaint.
Action Items: Review your record retention policies to ensure you’re in compliance with POWR’s recordkeeping requirements. Make sure you have a reliable system in place for documenting all complaints of discrimination, harassment, or retaliation.
Marital Status is Now Protected
The POWR Act adds marital status as a protected trait under the Colorado Antidiscrimination Act.
Action Items: Update your EEO and nondiscrimination policies to ensure that marital status is included as one of the protected traits. Update training materials for management to ensure they are not making personnel decisions based on individuals’ marital status.
