Colorado Legislature Puts More Teeth into the Colorado Anti-Discrimination Act

May 23, 2013

Author: Brent T. Johnson

On May 6, 2013, Governor Hickenlooper signed House Bill 13-1136, which significantly expands the remedies available to individuals alleging employment discrimination in violation of the Colorado Anti-Discrimination Act (“CADA”).  Small businesses with fewer than 20 employees will feel the biggest impact from these changes, because federal law already provides most of these remedies in cases against larger employers.

A brief summary of federal anti-discrimination laws is helpful to understand the effect of the amendments to CADA.  The federal law that prohibits employment discrimination based on age only applies to employers with 20 or more employees, while the main federal laws that prohibit employment discrimination based on race, sex, religion, national origin, and disability only apply to employers with 15 or more employees.  Federal antidiscrimination laws allow trial by jury and awards of attorney fees to successful plaintiffs.  They also allow monetary awards of compensatory damages (for emotional distress and similar injuries) and punitive damages in cases alleging discrimination other than age discrimination.

Although CADA has long prohibited employment discrimination by employers with too few employees to be subject to federal laws, up until now CADA has not allowed jury trials, awards of attorney fees, or awards of compensatory and punitive damages.  That will change under HB 13-1136, however.  Some of these changes become effective on August 7, 2013, while others do not become effective until January 1, 2015.

Attorney Fees.  In any lawsuit under CADA as amended by HB 13-1136, the court “may” award reasonable attorney fees and costs to a prevailing plaintiff.  Although this is worded as permissive rather than mandatory, we expect that a prevailing plaintiff will virtually always be awarded reasonable attorney fees.  By contrast, a prevailing employer can only be awarded attorney fees if the court determines that the plaintiff’s claims were frivolous, groundless, or vexatious.  This is similar to federal law, where in practice a prevailing employer almost never recovers its attorney fees from the losing plaintiff.  Since attorney fees may be very large amounts, this change in the law significantly increases the financial risk to small employers sued under CADA.  This change goes into effect on August 7, 2013.

Compensatory and Punitive Damages.  For all acts of employment discrimination (other than age discrimination) that occur after January 1, 2015, CADA will allow an award of compensatory and punitive damages.  The total amount of such damages is limited to $10,000 for employers with fewer than five employees, and $25,000 for employers with between 5 and 14 employees.  For employers with 15 or more employees, the sliding scale of damage caps under federal law will apply, currently limiting those damages to between $50,000 and $300,000, depending upon the number of employees. 

While this change in the law will primarily affect only small employers, larger employers will for the first time be exposed to liability for these types of damages in cases involving discrimination on the basis of sexual orientation, which is prohibited under CADA but not under federal law. That is also true if an employer fires or refuses to hire an individual because that person is married to or plans to marry another employee (subject to some exceptions), because federal law does not prohibit that type of marital discrimination.

Although the Colorado Civil Rights Commission has the authority to hold hearings and grant relief such as back pay, reinstatement, and front pay, only a court may award compensatory or punitive damages.  Compensatory damages may only be awarded in cases of intentional discrimination, not where an employer’s neutral policies have a disparate impact on certain employees.  Punitive damages may only be awarded if there is clear and convincing evidence that the defendant acted with malice or reckless indifference to the rights of the plaintiff.  If an employer demonstrates good-faith efforts to comply with the law and prevent discriminatory practices, then the court shall not award punitive damages.

Right to Jury Trial.  Under HB 13-1136, in any civil action seeking compensatory damages or punitive damages under the amended provisions of CADA, either party may demand a trial by jury.  Because compensatory or punitive damages are not available for discrimination that occurs before January 1, 2015, however, there will be no right to a jury trial before that date.

Age Discrimination.  Both Colorado and federal law treat age discrimination differently in some respects than other types of employment discrimination.  The new changes to CADA make clear that compensatory and punitive damages cannot be awarded in age discrimination cases.  This in turn appears to mean that there is no right to a jury trial on an age discrimination claim under CADA, since the right to a jury trial applies only in cases seeking compensatory or punitive damages.  This diverges from federal law, which does allow a jury trial on age discrimination claims, and this issue may well be the subject of future litigation or future legislative clarification.

HB 13-1136 provides that age discrimination claimants under CADA may recover the same remedies that are available under specified sections of federal law.  Those remedies include liquidated damages in cases of willful violations, which basically means that back pay awards can be doubled.  Once again, this change primarily impacts employers with fewer than 20 employees, since larger employers were already exposed to the possibility of liquidated damages under federal law.

CADA previously protected individuals against age discrimination only if they were older than 40 but younger than 70.  That upper age limit has now been removed, making CADA consistent with federal law.  These changes regarding age discrimination are effective August 7, 2013.

Final Thoughts for Colorado Employers.   Particularly for small employers, the stakes have been raised considerably in employment discrimination cases under Colorado law.  Small employers would be well-advised to learn more about how to avoid discrimination claims in the first place; take steps to show a good faith effort to comply with the law, such as proper policies and training of supervisors; and carefully evaluate the potential exposure when deciding how to deal with any discrimination claim that may be asserted.

This Article is published for general information, not to provide specific legal advice. The application of any matter discussed in this article to anyone's particular situation requires knowledge and analysis of the specific facts involved.

Copyright © 2013 Fairfield and Woods, P.C., ALL RIGHTS RESERVED.

Comments or inquiries may be directed to: Brent T. Johnson