Skip to content Skip to footer
Templates
Table of contents

This Colorado Human Resources Manual is offered to you for free. Find state specific laws and regulations below.

Policies and procedures manuals — Colorado

Among the more critical issues facing employers in today’s legal environment are whether and how to draft and publish an employee handbook or personnel manual containing the employer’s personnel policies and procedures. As many employers have learned through experience, an employee handbook (typically distributed or made available to employees for their personal use) or a personnel manual (usually maintained in the human resources office and made available to employees upon request) can be an extremely beneficial tool in accomplishing the employer’s human resources objectives. 

A carefully prepared, well‑drafted personnel manual provides an employer with an ideal opportunity to communicate to its employees the company’s philosophy regarding its customers, products, and workforce, as well as the employer’s specific expectations as to individual employee performance and conduct. These documents also are the means by which an employer establishes standard, non‑discriminatory personnel policies that may be applied and administered by company management in a consistent and uniform fashion, thereby minimizing the risk of claims of unlawful employment discrimination.

Written employment policies and procedures also may help reduce employee dissatisfaction and complaints by providing employees with a forum through which they can raise specific employment concerns with management in a non‑threatening, non‑adversarial context, while at the same time increase employee productivity and eliminate from the workforce those employees who fail to conform to company expectations.

It is also possible that a personnel manual may serve as a deterrent to unionization. Handbooks and personnel manuals provide an important vehicle for an employer to communicate its philosophy toward unions, to prevent the kind of favoritism in the application of employment policies that often leads to employee dissatisfaction, and to give employees a sense that a union contract simply is unnecessary because the written policies and procedures serve as an effective and satisfactory alternative.

These potential benefits notwithstanding, some employers hesitate to adopt a personnel manual for fear that doing so might jeopardize the at‑will employment status of their employees. These employers believe that publishing such a set of policies and procedures could inadvertently restrict their legal ability to terminate their employees when warranted.

It is useful to think in terms of a “policies and procedures manual” rather than a handbook. In keeping a policies and procedures manual comprised of separate and distinct policies and procedures on a variety of workplace-related topics, the individual policies within the manual may be revised and updated as needed without revising the entire manual. Moreover, a compilation of policies and procedures may be less likely to be interpreted as a contract for employment, as is a concern mentioned.

Regardless of the format of the employer’s policies, decisions should be made early in the process as to the content, form, and tone of the policies and procedures manual. There are also certain necessary policies that should be included in any manual and some policies that should be avoided. This chapter will discuss issues facing employers with regard to other recommended policies that are often found in handbooks, as well as other optional policies employers may choose to include in their policies and procedures manual based upon the needs of the particular company. Finally, because policies in themselves are not effective without implementation, a plan for implementation is an important step in the creation of any manual.

Things to consider

  • The composition and educational level of the workforce will determine the complexity of the language and terms that are used in the manual.
  • If the company is developing policies for the first time, it must decide how “tough” or “easy” it wants to be on a myriad of issues.
  • Does the company want to do only the minimum the law requires or does it want to provide its employees with additional, more generous benefits, leave, pay, etc.?
  • Will the manual cover the conduct and benefits of managers and executives, as well as employees?
  • Will both unionized and non-unionized employees be subject to the manual?  If the answer is yes, the policies will obviously have to be consistent with the union contract.

Necessary policies and forms

Very few state or federal employment laws require employers to insert particular language in their employee manuals. However, some court decisions have made it advisable for employers to include certain policies and language in manuals that communicate information about the terms and conditions of employment to employees.

Introduction to the manual

At the beginning of the manual, most employers include an introductory statement that welcomes employees and explains the purpose and scope of the manual. It is important that this introduction contain a clear statement that the employee manual does not create a contract of employment between the employer and any employee, and that all employment is on an “at-will” basis. This statement should be clear and distinguishable; typically, handbooks print the statement in large, bold font.

Family and medical leave policy

The Family and Medical Leave Act (FMLA) is the only federal employment law that specifically requires employers to include a particular policy in its employee manual. The Department of Labor’s (DOL’s) regulations interpreting the FMLA state that an employer is not required to have an employee handbook, but if it does have such a handbook, the handbook must include a statement of the employer’s policy on FMLA leave. Of course, this requirement only applies to employers who are subject to the FMLA.

Colorado Overtime and Minimum Pay Standards Order # 36

On March 16, 2020, the Colorado Overtime and Minimum Pay Standards Order # 36 went into effect in Colorado.  It requires all employers who distribute a handbook to include a copy of the order in the handbook, and employees must sign an acknowledgment stating they received it.  Employers must also post the order in a conspicuous place on its premises.

Equal employment opportunity policy

Another important element of any employee manual is a statement that the employer is committed to making all employment decisions without regard to any protected classification, such as:

  • race
  • color
  • national origin or ancestry
  • religion
  • sex and gender identity
  • sexual orientation
  • pregnancy and family status
  • genetics
  • age
  • disability
  • concerted activity of employees on terms of employment
  • assertion of a workers' compensation claim
  • service in the uniformed services.

Harassment policy

Many employers choose to combine their equal employment opportunity policy with a policy prohibiting harassment in the workplace. Supreme Court precedent has made it a virtual necessity for an employer to develop and enforce a strong and comprehensive harassment policy to its employees.

Employment at-will policy

Although a good employee manual will explain the at-will status of employment in its introduction, it is a good idea to include a separate employment at-will policy as well. In addition to stressing that the handbook will not change employees’ at-will status, this policy should also state in clear and distinguishable font, that the employees’ at-will status may not be modified by any oral or written representations other than a written contract of employment signed by the appropriate officer of the company and the employee.

Standards of conduct policy

No law requires that an employee manual contain a list of prohibited types of employee conduct, but this is one of the main reasons many employers develop employee manuals in the first place. A typical standards of conduct policy should list the common types of misconduct that may result in discipline, but it should also stress that this list is not all-inclusive. The policy should also state that misconduct might result in discipline, up to and including termination. The goal of the published policy is to place employees on notice of what is unacceptable conduct and what could result in discipline (including termination), while still retaining the employer’s the discretion to decide the level of discipline to be imposed.

Procedure for Accessing Personnel File

With the enactment of HB 16-1432, private employees should write and uniformly enforce a policy that establishes not only the steps by which an employee may request access to their own personnel file, but also the steps by the employer will respond. The procedural steps to request access may include paying a nominal fee to cover the processing cost of accessing the file.  Public employers should already have this policy on file and should review it to ensure it is in compliance with Federal law and the Colorado Open Record Act.

Acknowledgment form

One of the most important parts of an employee manual is an acknowledgment form. This form is usually included at the end of the resource and is designed to be read by employees, signed, and returned to the company to be retained in the employee’s personnel file. A good acknowledgment form will contain the same disclaimers found in the introduction about how the handbook does not create an employment contract or any other type of contract. The acknowledgment form should also reiterate that the policies may change from time to time and will be interpreted by the company in its sole discretion.

Some employers have decided to implement a mandatory arbitration process, which requires employees to resolve all employment-related disputes with the company through arbitration, rather than a lawsuit. While there are many pros and cons to implementing such an approach, it is important to realize that a statement embedded in an “acknowledgment form” that states that the employee is also agreeing to arbitrate employment-related claims may not be sufficient to keep the employee from bringing a suit. Many courts have indicated that mandatory arbitration agreements must be clear and will not be effective if they are simply included in a general acknowledgment form.

A note on Mandatory Arbitration

While Colorado prefers mandatory arbitration as a matter of public policy, it is important to note that the national trend is to invalidate such agreements signed in an employment application or during the interview process. Prior courts have ruled that the unequal power an employer holds in pre-employment circumstances create a contract of adhesion. When considering mandatory arbitration as a matter of course, it is advised that Colorado employers seek legal counsel in drafting these agreements. Some states, such as New Jersey require that a specific agreement be written for each employee, with explicitly bolded language that clarifies that they are giving up their right to a trial and legal pursuit in court. Employers are urged to keep national trends in mind when drafting these agreements into an application or an acknowledgement form.

Optional areas to address

  • Workweek - State what the regular workweek is so employees know when they are to report to work and when they may leave, thus providing a basis for assessing punctuality and attendance.

  • Lunch/Meal periods - Colorado law requires at least an uninterrupted and “duty free” unpaid 30-minute break, lunch/meal period, when the scheduled work shift exceeds five consecutive hours of work. Defining break times that comply with the law helps communicate expectations, allowing enforcement.

  • Rest periods - Colorado law provides that rest periods should be in the middle of each four-hour work period. A compensated 10-minute rest period for each four hours or major fractions thereof must be permitted for all employees. These rest periods should not be deducted from the employee’s wages. It is not necessary for the employee to leave the premises for the rest period.

  • Overtime - Colorado law provides that employees must be paid time and one-half of the regular rate of pay for any work in excess of:

    • 40 hours per workweek
    • 12 hours per workday
    • 12 consecutive hours without regard to the starting and ending time of the workday (excluding duty free meal periods).
  • Whichever calculation results in the greater payment of wages. Employers should state clearly when and how overtime work is allowed and should consider requiring written approval before overtime work starts. That said, unauthorized overtime will still need to be paid but a violation of the written policy on overtime can be the basis for discipline.

  • Vacation time - While Colorado law does not require that an employer provide paid vacation or establish a vacation policy, if a policy is established, employees must be made aware of the employer’s policy. The policy should note at the outset that these benefits are what the employer is currently offering and that they are subject to change so that an employee does not claim to have a contractual right to such benefits year after year. On these subjects, the communication is not to create a basis for accountability but rather to promote the fact that the employer is providing such benefits. Under the Colorado Wage Claim Act (CWCA) the terms “wages” and “compensation” are used interchangeably, and include: “vacation pay earned in accordance with the terms of any agreement.” Consequently, if an employer provides employees with paid vacation, it must pay the employee at the end of the employment relationship for all of his/her unused accrued vacation. Under Colorado law, employees who have an enforceable right to receive payment for accrued leave under an employment agreement or policy have a vested interest in that compensation when it is earned. On December 19, 2019, the Colorado Department of Labor adopted a new rule on use-it-or-lose-it vacation policies. The new rule confirms that unused vacation pay is "earned" and must be paid to an employee upon separation of employment. The written guidance further states that employers may have use-it-or-lose-it policies that "disallow carryover after employees accrue a year of vacation pay, but that do not forfeit any of that year's worth." For example, under an employer's vacation policy it allows for 10 vacation days per year:

    • The policy may provide that employees can accrue more than 10 days, by allowing carryover of accrued vacation from year to year.
    • The policy may provide that employees cannot accrue more than 10 days, by disallowing carryover of unused vacation from year to year.
    • The policy may not provide that after an employee accrues 10 days, that amount diminishes below 10 days for any reason.
  • Substance testing - Under Colorado law, employers may require drug and alcohol testing on their employees. Employers are not required to allow or accommodate marijuana in the workplace under Colorado’s marijuana law. Similarly, the ADA does not require employers to accommodate the use of marijuana.

  • Smoking - The employer should note that smoking is only permitted on authorized breaks, not when the employee needs or wants to smoke. The employer should identify the outdoor locations where smoking is allowed.

    • Note: Colorado expanded its ban on smoking in public places and workplaces to include electronic cigarettes. This ban includes vapor, inhalant, burned or heated tobacco or marijuana product in any form in any indoor area including a place of employment.
  • Performance evaluations - The employer may want to describe in writing the process it has for performance evaluations so that the employees understand that there is a thoughtful review of his/her work on a periodic basis. That said, this description of the evaluations should be published only if the employer is confident that the evaluations will be done and done well. It is very frustrating for employees to see the promise of thoughtful evaluations of their work unfulfilled.

  • Computer and Internet use - This subject is an increasingly important subject and should be carefully written and emphasized. At a minimum, the policy should state unequivocally that there is no such thing as privacy on any employer owned computer and that the employer may read any emails written on their equipment. The employer should also consider forbidding the downloading of any applications to the computer without permission. The employer should also consider how it wishes to regulate the use of social networks being mindful that increasingly, employees are using the networks as part of their work. See Chapter 31: Technology and the Internet, for more information on this subject.

  • Dress code - This subject is increasingly challenging. The guiding principle is to post written expectations that are consistent on a gender basis, realistic, enforceable, and likely to be followed by all employees. Many times a standard is set forth (that is, no blue jeans), only to be violated by supervisors or even officers. Buy-in on the standard at all levels is important for the policy to work.

  • Benefits - Employers like to use the policy manual to describe the benefits they may provide such as health insurance, long- and short-term disability, and/or retirement benefits. Listing these benefits reminds employees of what else the employer is providing beyond a paycheck. The description of the benefits should be clear that the list of benefits could change at the choice of the employer. The description of the benefits themselves should be quite simple and inform the employee that this description does not change or alter the summary plan document that governs the benefit and that is available from the human resources manager.

  • Pregnancy accommodations - Under the Pregnant Workers Fairness Act, Colorado employers must provide a pregnancy accommodation policy containing information concerning an employee’s right to reasonable accommodations, specifically including leave, for a disability caused or contributed to by pregnancy. The policy should contain the condition that accommodations cannot impose an undue hardship on the employer.

  • Jury duty and subpoenaed witness duty - An employee’s right to leave work for jury duty and/or subpoenaed witness duty is governed by state and federal law. Federal law prohibits employers from disciplining or terminating an employee for jury duty in federal courts. Most states – including Colorado – prohibit an employer from disciplining or terminating an employee for jury duty. Some states do the same for subpoenaed witness duty as well. Colorado requires employers to pay employees their regular wages, up to $50.00 per day, for up to three days of jury duty.

  • Military leave - The federal Uniformed Services Employment and Reemployment Rights Act (USERRA) and various state laws govern the amount and nature of leave an employee is entitled to for serving in the military. A company’s military leave policy should explain what types of military leave are permitted and should explain what an employee must do to exercise his/her re-employment rights under the statute. In addition, the policy should state whether the employer will continue to pay an employee during the military leave.

  • Voting leave - An employee taking voting leave in Colorado cannot be disciplined in any way, including reductions in pay. An employer can specify the hours during which the employee may be absent to vote, but the hours shall be at the beginning or end of the work shift if the employee so requests. An employer is not required to provide voting leave if there are three or more hours between the time of opening and the time of closing of the polls during which the employee is not required to be on the job. If there are not, the employer must provide up tot two paid hours off work for employee to vote.

  • Domestic violence leave - An employer must permit an employee experiencing domestic violence or abuse, sexual assault or stalking (or whose family member has been) to take up to three unpaid days off per 12-month period to:
    • seek protection
    • obtain medical or mental health care
    • make their home secure or seek new housing
    • seek legal assistance and/or prepare for an attend court-related proceeding.

The employer may require the employee to exhaust paid time off before taking this leave.

Volunteer/Emergency services and disaster workers leave - An employee who is qualified under state law and who is called into service by a volunteer organization for a disaster must be afforded up to 15 days of unpaid leave in a calendar year, so long as the employer does not deem the employee to be essential to the operation of the employer's daily enterprise, the employee's absence would not cause the employer to suffer economic injury; and the employee provides proof that he or she is a qualified volunteer.

Implementing the employee manual

It is not enough for an employer to simply develop a comprehensive employee manual – the manual must also be effectively distributed to employees and consistently enforced. To be sure that company managers will be willing and able to enforce the policies contained in the manual, it is a good idea to have a few key managers at each level review a draft of the manual before it is finalized. These managers may be able to tell the employer whether the manual accurately reflects current practices, whether it sets realistic standards, and what employee reaction will be to changes.

Present new manuals to employees

When the manual is ready to present to employees, it may be rolled out with some degree of fanfare to ensure that all employees are aware of the new policies. On the other hand, if the “culture” of the company warrants it, a lower key approach may be more desirable. Often, the president/CEO of the company will issue a formal announcement and/or draft a welcome letter to be included with the manual. If the manual represents significant changes from the company’s previous policies, training sessions should be held for managers who will have to implement and enforce the policies. The human resources department should also be prepared to receive a large number of questions from employees and managers during the initial weeks and months the new manual is in effect.

Acknowledgment forms

As noted previously, an important part of the implementation process is having employees sign the acknowledgment forms found at the end of the manual and return them to the company for filing. The manual will not provide the employer with much protection in the event of a lawsuit or other dispute if the company cannot demonstrate that the employee received and read it. The human resources department may want to keep a list of all employees and check each employee’s name off as it receives a signed acknowledgment form from that employee. Managers will also need to be educated in the importance of such forms, and the processing of such forms may need to be added to the new-hire process. The signed acknowledgment forms should be kept in the employees’ individual personnel files.

Frequency of manual revisions

Periodic reviews of handbooks/manuals should be conducted every year or two in order to ensure that the manual reflects any changes in the law and reflects the company’s current practices. Each time the manual or particular policies are updated, the human resources department should keep several copies of the old manual or policies on file. These may be needed to manage an employee with disciplinary problems under a prior version of a policy or if a lawsuit is later filed concerning events that occurred under a previous version of the manual.

Enforcing the manual

Finally, it is critical to ensure the policies that are documented in the manual are enforced consistently. Nothing looks worse in front of a jury than an employer who violated its own written policies.