Colorado
Make employment in Colorado easy. Let us handle payroll, benefits, taxes, compliance, and even stock options for your team in Colorado, all in one easy-to-use platform.
- Capital City
Denver
- Currency
United States Dollar ($, USD)
- Population size
5,800,000
Facts & Stats
- Capital City
Denver
- Currency
United States Dollar ($, USD)
- Population size
5,800,000
- VAT - standard rate
3% (Additional local sales taxes apply)
Home to the breathtaking beauty of the Rocky Mountains, Colorado also boasts thriving tech scenes in both Denver and Boulder.
With a robust job market, a strong commitment to sustainability, and a high quality of life, The Centennial State is a highly sought-after destination for both employers and employees alike.
Grow your team in Colorado with Remote
If you want to hire in Colorado, you’ll need to own a legal entity there — or partner with a global employment solutions provider, like Remote.
We can employ top talent in Colorado on your behalf and manage complex HR tasks such as onboarding, payroll, benefits, and taxes. You can also manage and pay your contractors in Colorado through Remote.
Risks of misclassification
Colorado, like many other countries, treats self-employed individuals or contractors and full-time employees differently. Misclassification of contractors in Colorado may lead to fines and penalties for the offending company.
Employing in Colorado
In Colorado, workers’ rights are protected by numerous employment and labour laws, at both the state and federal level. As a result, employees enjoy protection from discrimination based on age, religion, sexual orientation, gender, and race.
Here are the key things you need to know about hiring in Colorado.
Hours of work in Colorado
Work and overtime laws in Colorado are governed by the state’s Department of Labour and Employment.
What is considered full-time employment in Colorado?
Full-time employment is generally considered to be between 32 and 40 hours per week.
Do pay employees get overtime in Colorado?
Non-exempt employees are entitled to overtime pay of 1.5x their regular pay rate if they work more than 40 hours in a week.
Under the federal Fair Labour Standards Act, employees are generally (but not always) exempt from overtime if they:
Earn more than the state or federal exemption threshold
Perform a role with duties that are considered executive or managerial
Work in a certified or licensed profession, such as law, accounting, architecture, or engineering
In Colorado, the annual pay threshold for exemption is currently $50,000 (or $31.41 per hour for highly technical IT professionals).
Note that the state exemption threshold will increase in both 2024 and 2025, while the federal pay threshold for exemption is currently being reviewed.
Minimum wage in Colorado
The minimum wage for private sector employees in Colorado is $14.42 per hour.
Onboarding timeline in Colorado
We can help you get your new employee started in Colorado fast, with a minimum onboarding time (MOT) of just 2 working days. Note that the MOT is dependent upon registration with the local authorities, and begins after the employee has submitted all the required information on the Remote platform.
For non-citizens of the US, a work eligibility assessment may be required, and can add three extra days to the onboarding time. If a follow-up is needed, there may be additional delays.
Please note that payroll cut-off dates can impact the actual first day of employment. Remote’s payroll cut-off date is the 10th of the month, unless otherwise specified.
Payroll cycle in Colorado
Under state law, employees must be paid at least once per month.
For Remote customers, employee payments are made twice per month in equal instalments, payable in arrears. The first payment is made on the 15th of the month and the second payment is made on the final day of the month. If relevant, bonus payments, commissions, and expense reimbursements are included in the second payment of the cycle.
Competitive benefits in Colorado
Remote can help you craft a competitive benefits package to attract and retain the best global talent. Our benefits experts understand the trends, requirements, and expectations of Colorado's labour market, allowing your employees to feel appreciated and thrive.
Our benefits packages in Colorado usually include some or all of the following:
Pension or 401(K)
Medical Insurance
Vision Insurance
Dental Insurance
Life Insurance
Health Saving Plan (HSA)
Long term disability insurance (LTD)
Flexible Spending Account (FSA)
Are employers required to provide health insurance in Colorado?
Under the federal Affordable Care Act, organisations with a headcount of 50 or more must offer statutory health insurance to their full-time employees.
Many employers also offer some level of supplemental health insurance. While this can lead to a relative rise in employment costs, it’s an essential benefit that ensures your people have access to routine care and are covered in the event of an emergency.
Because Remote is the employer of record (EOR), it’s important for us to offer the same core benefits to all employees to ensure fair and non-discriminatory hiring practices. This protects both your business and ours.
Note that we do not add a markup on any benefits premiums or administration costs.
Are employers required to offer 401k in Colorado?
Yes; organisations must offer a retirement plan to their employees. You can either choose your own qualified savings plan, or enrol your employees into the state-sponsored Colorado Secure Choice Savings Program.
Note that this only applies if your business:
Has at least five employees
Has been a registered business for at least two years
Does not already offer a qualified savings plan
Failure to enrol can result in a fine of $100 per employee, per year (up to a maximum of $5,000).
Taxes in Colorado
Employment taxes and statutory fees affect both your payroll and your employees’ paychecks in Colorado.
Note that your employees may be liable for additional local taxes in certain areas.
Employer taxes
Employment Tax | |
|---|---|
6% | Federal unemployment insurance tax (FUTA) (charged on the first $7,000 an employee earns per year) |
0.7% to 10.39% | State unemployment insurance tax (SUTA) |
6.2% | FICA (Social security) |
1.45% | FICA (Medicare) |
Employee taxes
Payroll Tax | |
|---|---|
10% to 37% | Federal income tax |
4.4% | State income tax |
6.2% | FICA (Social security) |
1.45% | FICA (Medicare) |
Types of leave
Holiday | In Colorado, there is no state or federal law that requires employers to provide paid or unpaid holiday leave to their employees, although many organisations do. |
Sick leave | Under state law, all employers must provide one hour of paid sick leave for every 30 hours worked. Under the state’s FAMLI Program, eligible employees are also entitled to up to 12 weeks’ paid leave for serious health conditions, or the caring of a family member with a serious health condition. Can an employer deny sick time in Colorado? Under the federal Family and Medical Leave Act (FMLA), eligible employees are entitled to up to 12 weeks of unpaid sick leave per year, provided they: - Have worked for the same employer for at least 12 months - Work in a location where at least 50 people are employed by the company within a 75-mile radius |
Parental and maternity leave | Under the state’s FAMLI Program, eligible employees are entitled to up to 12 weeks’ paid parental leave. Employees who experience pregnancy or childbirth complications are also entitled to an additional four weeks’ paid leave. Employees are also entitled to up to 12 weeks of unpaid maternity or paternity leave under the FMLA. |
Bereavement leave | Employers are not legally required to provide bereavement leave to their employees, although most organisations offer unpaid leave. |
Jury duty | Employees must report for jury duty if summoned (unless exempt). Jurors are typically on call for two weeks. Do employers have to pay for jury duty in Colorado? Yes. Employers must pay up to $50 per day for the first three days of the service. Employers can also not penalise or terminate an employee on jury duty. |
Military leave | Under state and federal law, employers must grant unpaid leave to employees who are members of the military or the National Guard for military duty or training. These employees have the right to take time off for their military obligations, and employers are prohibited from discriminating against them based on their military service. |
Employment termination
Termination process
Like nearly all US states, Colorado is an at-will state. This means both employers and employees can end the employment relationship without reason, provided it is legal.
Remote’s legal experts can help you navigate terminations to ensure employees are only let go fairly, negating any potential legal complications.
Notice period
Employers and employees are not required to provide notice of termination, unless otherwise stated in the employment contract.
Despite this, it's usually customary for employees to provide two weeks' notice when leaving an organisation.
Severance pay
Employers are not legally required to provide severance pay (unless it is stipulated in the employee's contract or in the company policy).
However, employers must pay any accrued but unused holiday time.
Probation periods
There is no requirement to provide a probation period for employees, although many companies implement internal probation policies. These policies typically involve a formal performance evaluation after a specified period, such as three or six months.