The termination of employment by an employer can be a difficult and stressful situation for both parties involved. As the employer, it is important to be aware of the laws and regulations surrounding the termination of at-will employment in Colorado and be prepared ahead of time, making the transition for the departing employee both lawful and proper. One important component of at-will employment termination is payment of final wages.
According to the State of Colorado’s Department of Labor & Employment (CDLE), it is required by law that “when an interruption [instigated by the employer] in the employer-employee relationship occurs, the wages or compensation for labor or service earned, vested, determinable, and unpaid at the time of such discharge are due and payable immediately.” There are two exceptions to this rule: when the employer’s accounting unit is not regularly scheduled to work at the time of the separation, unpaid final wages must be made available to the terminated employee within six hours of the accounting unit’s next regular workday; also, if the accounting unit is located off the work site, the employer must deliver the unpaid wages no later than twenty-four hours after the start of the accounting unit’s next regular workday. The unpaid wages can be delivered either to the work site, the employer’s local office, or mailed to the employee’s last-known mailing address. If the unpaid wages are mailed, they must be postmarked within that twenty-four hour period.
In situations where a terminated employee was “entrusted with the collection, disbursement, or handling of…money and property” and failed to return said money and property to the employer, the employer is allowed 10 calendar days after the termination of employer to “audit and adjust the accounts and property value of any items entrusted to the employee before the employee’s [final] wages or compensation shall be paid.”
These requirements only apply to employer-employee relationships severed by the employer. If an employee chooses to voluntarily quit or resign, their final wages must be paid by the next regular payday. If an employee is terminated for not showing up to work as scheduled, the CDLE considers this a resignation by the employee.
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