Colorado POWR Act: Changes to Workplace Harassment & Other Employment Law

 The Colorado Protecting Opportunities and Workers’ Rights Act (POWR) was signed into law on June 6, 2023 and takes effect on August 7, 2023. The new law makes several important changes to employment and harassment laws by redefining the standard for harassment claims, tightening requirements on non-disclosure agreements, protects marital status and enacts new requirements for personnel records storage. 

Because the law impacts many existing procedures, agreements and policies that companies may already have in place, Colorado employers need to carefully read and understand the new requirements and adapt accordingly.

Lower Burden of Proof for Harassment Claims

The biggest headline coming out of the new law is the amended standard for harassment claims. Colorado previously followed the federal law definition of harassment as being “severe or pervasive.” Now, conduct that is “subjectively offensive to the individual alleging harassment and is objectively offensive to a reasonable individual who is a member of the same protected class” will be considered harassment.

What this essentially means is that it will now be easier for an employee to bring a harassment claim by lowering the qualification threshold. In order to protect a business and reduce the likelihood of a harassment claim, employers must revisit their company harassment policies and programs to ensure they meet the following criteria:

• Quick, responsive actions to investigate and address any allegations of discriminatory or unfair employment practices.
• Documented communication regarding the existence of the program and how it works to all employees.

The new law states that employers must demonstrate they have a program that is “reasonably designed to prevent harassment, deter future harassers, and protect employees from harassment.” In defense of harassment claims, employers will have to show that the company harassment policy meets the above criteria and that the employee has unreasonably failed to take advantage of that program.

A New Definition of ‘Harassment’

Colorado previously defined harassment as any action that created a hostile work environment based on a person’s gender, race, national origin, sexual orientation, gender identity, gender expression, disability, age, or religion. That definition has now been expanded to include “any unwelcome physical or verbal conduct” directed at an employee, or group of employees, based on a broader definition of their perceived or actual belonging to a protected class. 

Two key changes to the new definition:

• Marital status is now a protected class
• An employee does not have to actually belong to a protected class to bring a harassment claim, as the language now covers the perception of a person’s belonging to a protected class.

What Constitutes a Harassment Violation

Because the charge of harassment no longer has to be deemed “severe or pervasive,” even a single occurrence of conduct or communication only has to be considered subjectively and objectively offensive. Violations are defined as discriminatory or unfair employment practices if they fall under the following stipulations:

• The conduct or communication is a term or condition of employment
• An employee’s response to the conduct or communication is a basis for any employment decisions or status
• The purpose of the conduct or communication is to interfere with an employee(s) work performance, or to create a hostile, intimidating or offensive work environment

Additionally, the new law takes the “totality of the circumstances” into consideration, meaning that even “petty slights, minor annoyances, and lack of good manners” can be considered harassment depending on the totality of the circumstances.

Other Important Labor Law Changes

Beyond the amended harassment definition and burden of proof, the POWR Act also affects other areas of Colorado labor laws.

Altered Disability Discrimination Framework
The POWR Act removed the “has a significant impact on the job” qualifier from the defense related to disability accommodations. Now, the defense is “if there is no reasonable accommodation that the employer can make with regard to the disability, the disability actually disqualifies the individual from the job.”

New Non-Disclosure Agreement Requirements
The POWR Act adds stronger requirements for non-disclosure agreements to be enforceable by employers, and effectively voids non-disclosure agreements unless they meet the below criteria:

• Non-disclosure agreements must equally apply to all parties
• Agreements do not restrain an employee from disclosing underlying facts of any alleged discriminatory or unfair employment practices
• Express statement that any disclosure of underlying facts of any alleged discriminatory or unfair employment practice does not constitute disparagement
• An included condition must state that the non-disparagement clause is no longer enforceable if the employer disparages the employee to a third party
• Only liquidated damages clauses considered reasonable and proportionate, and not punitive, will be enforceable
• An addendum must be attached and signed by all parties that attests to compliance with the above requirements under the POWR Act

New Recordkeeping Requirements
With the above changes, employers must now keep thorough and accurate records of any written or oral complaints of discriminatory or unfair employment practices for at least five years after the complaint was made, or five years after a personal action was taken – whichever is later. Records must include the complaint date, true identities of all parties involved, and a description of the complaint. Records are considered personnel files, not public files, and should be maintained in a designated secure repository.

What Employers Need to Do

Employers should ensure that company harassment and discrimination programs and policies meet the new requirements and are well-defined in order to mitigate exposure to harassment claims. 

Consult with an experienced employment attorney to make sure those policies and programs are comprehensive and factor in all of the latest employment and labor law changes.

Hackstaff, Snow, Atkinson & Griess is here to help! Contact us today for a free consultation.