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United States – Colorado 2022
Day Date Holiday Notes
Saturday Jan-1 New Year's Day
Monday Jan-17 Martin Luther King Jr Day
Monday Feb-21 President's Day
Monday May-30 Memorial Day
Monday Jul-4 Independence Day
Monday Sep-5 Labor Day
Monday Oct-3 Frances Xavier Cabrini Day
Friday Nov-11 Veteran's Day
Thursday Nov-24 Thanksgiving Day
Sunday Dec-25 Christmas Day
Monday Dec-26 Christmas Holiday
Countrypedia

United States – Colorado
Payroll and Benefits Guide

Last updated: Feb 07, 2022
Currency
United States Dollar (USD)
Payroll Frequency
Monthly
Employer Taxes
11.01% - 26.65%

Papaya Offers Complete Payroll, PEO and Contractor Management Services For United States – Colorado

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Overview

Capital
Denver
Currency
United States Dollar (USD)
Date Format
mm/dd/yyyy
Fiscal Year
1 January- 31 December
Public holidays calendar

Contributions

Employer

Employer Payroll Contributions

0.06% – 10.30% (Maximum taxable wages is 17,000.00 USD)
Unemployment (State)
2.70%
Unemployment- New Employer (State)
6.20% (Maximum taxable wages is 147,000USD)
FICA Social Security (Federal)
1.45%
FICA Medicare (Federal)
0.60% -6.00% (Maximum taxable wages is 7,000 USD)
FUTA (Federal Unemployment Tax Act) The FUTA tax rate is 6.0% with a taxable wage base of 7,000 USD. However, if states operate their unemployment insurance programs in compliance with federal law, then the FUTA tax is reduced (credit) by 5.4% to 0.6%.
11.01% - 26.65% Total Employment Cost

Employee

Employee Payroll Contributions

1.20% (Maximum taxable wages is 147,000.00 USD)
Colorado Disability Insurance
6.20% (Maximum taxable wages is 147,000.00 USD)
FICA Social Security (Federal)
1.45% (Maximum taxable wages is 147,000.00 USD)
FICA Medicare (Federal)
0.90%
Additional tax on earnings over 200,000 USD (High-income earners also pay an additional 0.9 percent in Medicare taxes)
9.75% Total Employee Cost

Employee Income Tax

State Income Tax
4.55%
Flat rate for single and married coupled filing jointly
Standard Deduction and Personal Exemption
Filing Status
Amount
Single
N/A
Couple /Married Filing Jointly
N/A
Personal Exemption
Single
4,900.00 USD
Couple /Married Filing Jointly
9,800.00 USD
Dependent
4,900.00 USD

Employee

Employee Income Tax

Federal Income Tax For Single Taxpayers
10.00%
Up to 10,275 USD
12.00%
10,276 USD to 41,775 USD
22.00%
41,776 USD to 89.075 USD
24.00%
89,076 USD to 170,050 USD
32.00%
170,051 USD to 215,950 USD
35.00%
215,951 USD to 539,900 USD
37.00%
539,901 USD or more

Employee

Employee Income Tax

Federal Income Tax For Married Taxpayers (Joint Filing)
10.00%
Up to 20,550 USD
12.00%
20,551 USD to 83,550 USD
22.00%
83,551 USD to 178,150 USD
24.00%
178,151 USD to 340,100 USD
32.00%
340,101 USD to 431,900 USD
35.00%
431,901 USD to 647,850 USD
37.00%
647,851 USD or more

Employee

Employee Income Tax

Federal Income Tax For Heads of Households
10.00%
Up to 14,650 USD
12.00%
14,651 USD to 55,900 USD
22.00%
55,901 USD to 89,050 USD
24.00%
89,051 USD to 170,050 USD
32.00%
170,051 USD to 215,950 USD
35.00%
215,951 USD to 539,900 USD
37.00%
539,901 USD or more

Employee

Employee Income Tax

Standard Deduction and Personal Exemption
Singles
12,950.00 USD
Married Filing Jointly
25,900.00 USD
Head of Household
19,400.00 USD

Minimum Wage

General

The minimum wage in Colorado is 12.56 USD per hour. 

The minimum cash wage (tipped employee) earns 9.54 USD per hour.
 

Payroll

Payroll Cycle

Employees are paid semi-monthly and monthly.

13th Salary

There are no provisions in the law regarding 13th salaries.

Working Hours

General

In Colorado, the workweek is a maximum of 40 hours per week or 8 hours per day.

Overtime

Colorado adheres to the Fair Labour Standards Act (FLSA), and work in excess of 40 hours per week is considered overtime and paid at the rate of 150% of the regular pay. If employees are scheduled to work on weekends or rest days, no additional payment is required. However, should an employer request an employee to work in exceptional circumstances on these days, then overtime is paid at the rate of 150% of the regular pay.

Working Week

Monday-Friday

Leave

Paid Time Off

Colorado does not have any state laws that govern paid time off. However, it is common for employers to decide whether to offer paid or unpaid vacation leave.  This must comply with employment law and must be stipulated in the collective bargaining agreements.

Public Holidays

There are 10 official holidays, however private employers are not required to provide either time off or overtime pay on these days.

Sick Days

It is common for an employer to follow the Family and Medical Leave Act (FMLA) which provides certain employees with up to 12 weeks of unpaid, job-protected leave per year for certain family and medical reasons (maternity leave, serious illnesses, or if the employee needs to care for a spouse or child).

Employees are eligible for FMLA if they have worked for their employer for at least one year, completed a minimum of 1,250 hours over the past year, and worked at a location where the company employs 50 or more employees within 75 miles.

FMLA eligible employees are entitled to:

  • 12working weeks of leave in any one year for a child’s birth and to care for the newborn child within one year of birth.
  • The employee may be entitled to leave for the adoption or foster care of a child and care for the newly placed child within one year of placement.
  • To care for the employee’s spouse, child, or parent who has a severe health condition.
  • A serious health condition that makes the employee unable to perform the essential functions of their job.
  • any qualifying exigency arising out of the fact that the employee’s spouse, son, daughter, or parent is a covered military member on “covered active duty.”

Or

  • 26 working weeks of leave during a single one-year period to care for a covered servicemember with a serious injury or illness if the eligible employee is the service member’s spouse, son, daughter, parent, or next of kin (military caregiver leave).

In addition to the FMLA, employers with more than 16 employees must provide one hour of paid sick leave for every 30 hours worked, up to a maximum of 48 hours of paid sick leave.

In addition to the Family and Medical Leave Act (FMLA) and the Pregnancy Discrimination Act, Colorado also has Colorado’s Pregnant Workers Fairness Act. This Act requires employers to provide pregnant employees with modified work environments, including longer breaks, light-duty, job restructuring, modification of equipment (including seating), etc.

Colorado’s Adoptive Parents Leave states employers must provide the same rights regarding maternity and paternity leave for both biological and adoptive parents, including any other employment benefits such as job protection and salary rates of pay.

Maternity Leave

Maternity leave falls under the FMLA and Pregnancy Discrimination Act (see Sick Leave).

Paternity Leave

Paternity leave falls under the FMLA (see Sick Leave).

Parental Leave

Parental leave falls under the FMLA and Colorado’s Adoptive Parents Leave (see Sick Leave).

Other Leave

  • Jury Duty: Full-time, regular employees are entitled to job-protected, paid leave for the first 3 days of jury duty at the rate of 50.00 USD per day (this can be more if stipulated in the contract). Employees must provide a copy of the jury summons to the employer. An employee is not entitled to compensation for time spent as a witness in a case, responding to a subpoena, or acting as a plaintiff or defendant in the courts.
  • Voting Leave: Employees who are registered to vote must be allowed up to two hours of paid leave to vote in any municipal, county, state, or federal primary or general election. Employees must provide reasonable notice to their employers to take time off to vote.
  • In addition to the federal law USERRA, Colorado law provides protection against discrimination for members of U.S. armed forces, reserves, National Guard, commissioned corps of the public health service, and any other category of persons designated by the president in a time of war or emergency. Colorado law provides up to 15 days of unpaid leave per year to members of the National Guard or the U.S. armed forces to attend military training. These members also have reinstatement rights to their former positions if they are still qualified and have satisfactorily completed the training.

Termination

Termination Process

Except in mass dismissals or as provided for in an employment contract or a collective bargaining agreement, U.S. law does not impose a formal notice period to terminate an individual employment relationship, and employment is stipulated “at will.” This means that either the employer or the employee may end the employment relationship without giving either notice or reason, provided it is not illegal, notable discrimination on the grounds of a category protected by law, etc., and as per the Federal Worker Adjustment and Retraining Notification Act (WARN).

The employment contracts of executives and other highly skilled individuals often incorporate a “just cause termination” clause which mandates that the employer may only terminate the employee for “cause” and lists the permissible grounds. In such cases, the parties negotiate the foundations for a “just cause” termination.

Notice Period

In Colorado, most employees are employed “at-will,” and either party can terminate the employment relationship without notice. In Colorado, payout of unused vacation time is not required by law. However, it is common for employers to pay an employee for unused vacation days, provided the employee gave some advanced notice of resignation. While there is no notice period, general practice is 2 weeks.

In mass dismissal cases the Worker Adjustment and Retraining Notification Act (WARN Act) must be followed, and employers must give 60 days’ notice to impacted employees.

Severance Pay

Except as otherwise provided in an employment contract or collective bargaining agreement, employers need not make severance payments to terminated employees. Many employers choose to offer severance pay based on the length of employment.

Probation Period

There are no provisions in the law regarding probation or trial periods. However, it is common practice for employers to set a performance evaluation after an initially stated period of employment of 90 days.

VISA

VISA

Foreign nationals without permanent resident status or a work visa are not permitted to work in the United States. An employer seeking to hire a foreign national may file a petition with the United States Department of Homeland Security or the United States Citizenship and Immigration Services (USCIS) for an employment visa on behalf of the prospective employee. If the petition is approved, the prospective employee must obtain a visa stamp from a United States embassy or consulate (Canadian citizens are exempt from this requirement).  To get a temporary U.S. work visa, an employer must file a petition with U.S. Citizenship and Immigration Services (USCIS). An approved petition must be part of the visa request.

The types of visas include:

  • H-1B: For applicants with a college degree hired to do specialized work. The visa is valid for three years and can be extended for an additional three years. The visa is connected to the employer that filed the petition. If there is a change of employer, the new employer must repeat the process. There are 65,000 H-1B visas available each year.
  • H-1B1: For applicants with a college degree from Chile and Singapore. The US government grants up to 1,400 visas to Chilean citizens and 5,400 from Singapore each year.
  • H-2A:  For temporary or seasonal agriculture work. It is limited to citizens of qualified countries. Usually valid for up to 1 year and can be extended to a maximum of 3 years.
  • H-2B: For temporary non-agricultural work. These visas are limited to citizens of qualified countries. Usually valid for up to 1 year and can be extended to a maximum of 3 years.
  • L: For intercompany transfers (people transferred from a foreign company to a US branch of the company). The applicant must have been employed at the company for a year before the transfer and work in a managerial level position or higher with specialized knowledge.
  • O: For people with extraordinary abilities in science, arts, education, business, or athletics.

The standard procedure is to obtain a short-term work visa and then apply for an immigrant visa after the employee has started working in the United States.

For those seeking employment-based immigrant visas:

  • E-1: Highest priority employment for those with extraordinary ability in science, arts, education, business, and athletics
  • E-2: For those with advanced degrees or exceptional ability
  • E-3: For skilled workers and professionals, as well as unskilled workers
  • E-4: Members of certain immigrant groups
  • E-5: Immigrant investors in US companies (substantial investment)

Alternatively, an employer may sponsor a potential employee’s application for permanent resident status, referred to as a “green card” if the employee can establish that the potential employee is a multinational executive or manager transferee, has unique skills, or has been offered a job in the United States. The employer must have been unable to recruit a U.S. worker who meets the position’s minimum requirements.

All employers are obligated to verify that all individuals they employ are authorized to work in the United States.

VAT

General

Colorado has a minimum combined sales tax rate of 7.72% (state tax is 2.90% and local tax is 4.82%).

Version History

February 7, 2022
The minimum wage in Colorado is now 12.56 USD per hour. Minimum cash wage (tipped employee): 9.54 USD per hour   
Payroll contributions and personal income tax rates have been updated.
January 1, 2021
Minimum wage: raised to $12.32. Tipped employee minimum wage raised to $9.30 
Income Tax: Colorado's flat tax drops to 4.55%.
SUTA State Unemployment Tax: Changed to 0.71% - 9.64%
Sick leave: Employers with 16 employees or more must provide 1 hour of sick leave for every 30 worked, up to a maximum of 48 hours of sick leave.
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