Remote’s guide to employing in

Colorado
colorado flag

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.

Services available in this country:
Employer of Record ProductPayrollContractor Management
  • Capital City

    Denver

  • Currency

    United States Dollar ($, USD)

  • Population size

    5,800,000

Services available in this country:
Employer of Record ProductPayrollContractor Management

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 labor 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 Labor 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 salary 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 Labor 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 salary 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 salary 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 installments, 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.

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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 labor 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, organizations 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; organizations must offer a retirement plan to their employees. You can either choose your own qualified savings plan, or enroll 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 enroll 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

Vacation

In Colorado, there is no state or federal law that requires employers to provide paid or unpaid vacation leave to their employees, although many organizations 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 organizations 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 penalize 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 organization.

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 vacation 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.