Wage & Hour Claim Investigations - Employer FAQs

Note: the following FAQs relate to individual claims. If you are under investigation regarding multiple employees and have received a document titled "Notice of Investigation" please direct your questions to the sender of that notice.

The Division of Labor Standards and Statistics assists employees performing work in Colorado with the recovery of earned compensation not paid in accordance with Colorado Wage and Hour Law. The wage complaint process is a free service and is available to current and former Colorado private sector employees, regardless of immigration status. The Division acts as a neutral third party who investigates and determines if violations of Colorado wage and hour law have occurred.

Once a complete Wage Complaint Form is received and reviewed, a letter is sent to the employer explaining the nature of the complaint and the amounts alleged to be owed. The employer is given the opportunity to respond to the complaint and provide documentation. The Division is required to issue a determination within 90 days of sending the letter to the employer, unless we notify the parties in advance of good cause to extend the investigation. At the end of the investigation, the Division sends a determination to both parties, along with information on appeal and termination rights.

The Division's investigation process (from filing of a complaint to determination) may take months, depending on the complexity of the claim and the other claims being processed.

Interpretive Notice &Formal Opinion ("INFO") # 2: DLSS Wage Claim Investigation Process

I received a notice that I may be in violation of Colorado wage and hour law. Where can I find information regarding laws and regulations in Colorado?

To read more about employer requirements in Colorado wage and hour laws, please click on the specific topic.

What documentation do I need to provide with my response to avoid a $250.00 fine for failing to respond or failing to provide a complete response?

Some of the documentation needed with a response to Notice of Complaint to avoid a $250 fine for failing to respond or failing to provide a complete response is listed below. Please note it is the employer's responsibility to provide any, and all relevant evidence necessary to determine whether wages or compensation have been paid to the claimant.

  • The Division’s Employer Response Form completed in a legible manner, signed and dated;
  • The requested itemized pay statement records or other proof of wage payments made; Pursuant to C.R.S. § 8-4-103, the itemized pay statement must reflect
    1. gross wages earned;
    2. all withholdings and deductions;
    3. net wages earned;
    4. the inclusive dates of the pay period;
    5. the name of the employee or the employee’s social security number; and
    6. the name and address of the employer.
  • All additional documents requested in the Notice of Complaint.

If deductions were taken, documentation validating the deductions pursuant to C.R.S. § 8-4-105.

What happens if I do not provide a response by the deadline or I fail to provide a complete response?

If the Division does not receive a complete response to the Notice of Complaint, the Division may assume that all of the allegations contained in the wage claim are true and may issue a Citation and Notice of Assessment based on those allegations. The Citation and Notice of Assessment may order you to pay the fullest possible penalties and fines allowed by law.

Pursuant to C.R.S. § 8-4-113(1)(b), the director shall impose a $250 fine on an employer who fails to respond to a notice from the Division to which a response is required.

Further, Pursuant to C.R.S. § 8-4-103 an employer is required to retain pay statement records for at least three years after the wages were due and have them available for inspection by the Division. If you fail to provide the pay statement records, the Division may impose a $250 fine per employee, per month, up to a maximum fine of $7,500.

What happens if I need more than 14 days to submit a response? Can I ask for an extension?

If you need more time to obtain the necessary documentation and respond, please contact the Division immediately to discuss an extension. An extension to respond does not extend the 14 day deadline to pay the full wages owed to potentially avoid penalties pursuant to C.R.S. § 8-4-109(3).

The Notice of Complaint serves as a written demand for payment of wages from the claimant. Pursuant to C.R.S. § 8-4-109(3), if an employee’s wages are not paid within 14 days after a written demand is sent to the employer, the employer is liable for the wages owed and an additional penalty of either 125% of the amount owed or the claimant’s average daily earnings up to 10 days, whichever is greater. If the employer is found to have failed to pay any amounts owed to the claimant within the 14th day of the Notice, the Division may assess penalties for late payment of wages that are payable to the claimant.

Am I able to reach a settlement agreement with the other party?

The parties can choose to enter into a settlement agreement during the investigation by using the Settlement and Voluntary Dismissal of Wage Claim Agreement. This form is provided to the parties as a courtesy only. The Division takes no position on whether the parties should settle this claim. If the employer and the claimant choose to settle, a copy of the agreement signed by both parties must be received (not just sent) by the Division within seven (7) days after the date by which both parties signed the agreement. You may wish to consult with a lawyer prior to signing the agreement. The Division cannot provide you with legal advice related to this agreement.

If you decide to negotiate a settlement with the claimant, the Division must still receive your written response to the Notice of Complaint within 14 days of the date of the letter to avoid possible mandatory fines and penalties. However, if a freely completed, not coerced, Settlement Agreement signed by both parties is received prior to the expiration of the 14 days and the claimant receives payment of the agreed upon amount within the time frame specified in the agreement, the investigation will be closed and you may forgo the written response.

What is considered a trade secret?

Pursuant to C.R.S. § 8-1-115, the Division's final decision issued to an employer for violation of a wage law shall be treated as a public record after all administrative remedies have been exhausted. The Division shall treat the final decision as a public record, unless the Director makes a determination that the final decision contains trade secret information. The Division will publish the final decision after redacting the trade secret information, if possible.

An employer may designate information submitted to the Division as proprietary, a trade secret, or privileged information in accordance with C.R.S. § 24-72-204(3). Information that may constitute a trade secret includes, but is not limited to, client lists, bids on contracts, inventions, designs, business methods, software algorithms, recipes, etc. If you have questions about what constitutes a trade secret under Colorado law, please contact a private attorney.

Any other helpful information I should know?
  • The Division’s investigation process (from filing of a complaint to determination) generally takes months, depending on the complexity of the claim and the other claims being processed.
  • Anything you provide to the Division will be shared with the other party to the claim.
  • Do NOT provide social security numbers (whether your own or someone else’s). Redact (cross out) any social security numbers that appear on documents you wish to provide to the Division prior to sending them.
  • It is your responsibility to inform the Division if there is any change in your contact information (phone number, email, or mailing address).
  • Pursuant to Wage Protection Act Rule 4.2, 7 CCR 1103-7: 4.2, the burden of proof used in the Division’s investigations is as follows:
    • First, an employee must provide an explanation of the claim that is clear, specific, and shows the employee is entitled to wages. The employee must provide sufficient evidence from which both a violation of Colorado wage and hour laws and an estimate of wages due may be reasonably inferred (show your math). Generally, an employee has met their burden before the Division will send a Notice of Complaint to the employer.
    • Then, the burden shifts to the employer to prove, by a preponderance of the evidence (meaning more likely than not), that the employee is not entitled to the claimed wages. If the employer fails to meet its burden, or fails to respond, the Division may award wages and/or penalties to the employee based on the employee’s evidence, and assess fines against the employer. 7 Code Colo. Regs. § 1103-7: 4.2

For specific questions on a claim, please contact the Compliance Investigator that sent you the notice. You will find their direct contact information in the signature line of the letter. Please make sure to have the Notice of Complaint or the claim number available at the time of your call.


Resources

Employer Response Form
Settlement and Voluntary Dismissal of Wage Claim Agreement
Laws, Regulations and Guidance
Colorado Overtime and Minimum Pay Standards Order ("COMPS Order")
Colorado Wage Act§ 8-4-101, et seq.,C.R.S.
7 CCR 1103-7 Wage Protection Act Rules
Interpretive Notice & Formal Opinion ("INFO") # 2: DLSS Wage Claim Investigation Process


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Colorado Division of Labor Standards and Statistics | 303-318-8441| Contact Us