A bill (HB 13-1136) is making its way through the Colorado legislature that if passed will change the landscape of employment discrimination lawsuits for employers, especially those with fewer than 15 employees. The bill would amend Colorado’s antidiscrimination statute so as to permit recovery of compensatory and punitive damages, as well as an award of attorneys’ fees to a prevailing plaintiff. The bill would also remove the maximum age limit for purposes of age discrimination claims such that persons 70 years of age or older could pursue a claim based on age discrimination.
Why is this proposed change so significant to Colorado employers? First, under current Colorado law, while an employer of any size (even with one employee) may be sued under the state antidiscrimination statute, the remedies are limited to recovery of front pay, back pay, interest on back pay, reinstatement or hiring. Employers cannot currently be sued under the state law for recovery of things such as lost opportunities; emotional pain and suffering; inconvenience; mental anguish; loss of enjoyment of life (i.e. compensatory damages), nor can they be assessed a penalty (punitive damages) or face having to pay a complaining party’s attorneys’ fees. Because of this limitation, and because federal antidiscrimination law (Title VII), which does allow for recovery of compensatory and punitive damages, and attorneys fees, is applicable only to employers with 15 or more employees, small businesses in Colorado (those with fewer than 15 employees) currently have a significant measure of protection from having to face and defend much more costly discrimination suits where the alleged damages can be greatly increased due to the exposure to compensatory and punitive damages and an award of attorneys’ fees. The proposed bill would eliminate the protection small businesses have from facing such suits and would obviously make the cost of doing business much greater.
The bill is also significant for small and large employers alike in that it would increase the potential for claims of age discrimination by eliminating the age 70 cap that currently exists. Additionally, because Colorado has already expressly made sexual orientation a protected class, and because such protection does not exist under federal law, if HB 13-1136 passes, an employee in Colorado alleging that their employer discriminated against them on the basis of sexual orientation would be able to bring suit without being subject to the remedy limitations discussed above. Opponents of the bill fear that this will result in a significant increase in sexual orientation discrimination claims. A further, more practical ramification of the bill is the likelihood that more suits alleging discrimination will be filed in state court as opposed to federal court. This could be significant because it is generally believed that employers get a more favorable application of the law in federal court and that federal judges in Colorado are more inclined to grant employers’ motions to dispose of the case before trial. With passage of the bill, plaintiffs alleging discrimination against an employer would no longer be compelled to file in federal court to take advantage of the broader scope of remedies.
Given the make up of Colorado’s legislature, and the sponsorship of the bill, it would appear that HB 13-1136 has the votes to pass and become law. However, the business community is lobbying hard against it and there are also discussions being held regarding amendments to perhaps soften its impact. There is also still a bit of uncertainty as to whether Colorado’s Governor would sign the bill in its current form. The lawyers of Spencer Fane are closely monitoring the bill and will continue to provide updates as to its status and how it will impact Colorado employers.