Overtime Laws in Colorado 2026: Pay Rates, Exemptions & Tax Deduction (2026)
⚠️Informational only — not legal or tax advice.
Guide for Colorado overtime laws 2026
Last verified: February 28, 2026
Next scheduled review: May 29, 2026
Table of Contents
- Colorado Overtime Laws at a Glance (2026)
- Does Colorado Have Its Own Overtime Law?
- How Overtime Pay Is Calculated in Colorado
- Who Is Exempt from Overtime in Colorado?
- Overtime Tax Deduction: “No Tax on Overtime” (2025–2028) — and Colorado’s Addback
- Can an Employer Require Overtime in Colorado?
- Industry-Specific Overtime Rules in Colorado
- How to File an Overtime Wage Complaint in Colorado
- Penalties for Overtime Violations in Colorado
- Colorado Overtime Law Updates (2025–2026)
- Frequently Asked Questions
- Sources and Verification
Colorado Overtime Laws at a Glance (2026)
| Colorado Overtime Law — At a Glance (2026) | |
|---|---|
| Details | |
| Overtime threshold | 40 hours/workweek OR 12 hours/workday OR 12 consecutive hours |
| Overtime pay rate | 1.5× regular rate of pay |
| Double time | No — Colorado does not require double time |
| 7th consecutive day rule | No — does not apply under Colorado law |
| State minimum wage (2026) | $15.16/hour (statewide); higher in some local jurisdictions |
| Exempt salary threshold (2026) | State: $1,111.23/week ($57,784/year); Federal: $684/week ($35,568/year) |
| Daily overtime | Yes — after 12 hours worked in a single workday or 12 consecutive hours without regard to workday |
| State enforcement agency | Colorado Department of Labor and Employment, Division of Labor Standards and Statistics (DLSS) |
| Federal enforcement | U.S. DOL Wage and Hour Division |
| Overtime tax deduction (federal) | Up to $12,500/year (2025–2028) — FLSA-covered workers; Colorado requires a state income tax addback |
| Statute of limitations | 2 years state (3 if willful) / 2 years FLSA (3 if willful) |
Governing law: Colorado Overtime and Minimum Pay Standards (COMPS) Order #40 (7 CCR 1103-1); 2026 PAY CALC Order (7 CCR 1103-14); Colorado Wage Act, C.R.S. § 8-4-101 et seq.; Fair Labor Standards Act, 29 U.S.C. § 207 Last verified: February 28, 2026
Does Colorado Have Its Own Overtime Law?
Colorado has its own comprehensive overtime law under the Colorado Overtime and Minimum Pay Standards (COMPS) Order, currently COMPS Order #40 (7 CCR 1103-1), issued by the Colorado Department of Labor and Employment (CDLE). The COMPS Order provides broader protections than the federal Fair Labor Standards Act (FLSA) in several important respects.
When Colorado law and federal FLSA rules differ, the standard that is more favorable to the employee applies.
Key differences between Colorado and federal overtime law:
- Daily overtime: Colorado requires overtime pay after 12 hours worked in a workday (or 12 consecutive hours regardless of workday boundaries). The FLSA does not impose any daily overtime requirement.
- Higher exempt salary threshold: Colorado’s salary threshold for overtime exemption ($1,111.23/week in 2026) is substantially higher than the federal threshold ($684/week). An employee earning between $684 and $1,111.22 per week may be exempt under federal law but is entitled to overtime under Colorado law.
- Broader coverage: The COMPS Order covers most private-sector employees in Colorado, including those who might not meet FLSA coverage thresholds for certain smaller employers.
- Comp time prohibition: Colorado explicitly prohibits private-sector employers from substituting compensatory time off for overtime pay.
State regulation: COMPS Order #40, 7 CCR 1103-1; 2026 PAY CALC Order, 7 CCR 1103-14 Agency: Colorado Department of Labor and Employment — https://cdle.colorado.gov/dlss-home-page/colorado-overtime-minimum-pay-standards-comps-order Federal statute: Fair Labor Standards Act, 29 U.S.C. § 207 — https://www.dol.gov/agencies/whd/overtime
Important note on COMPS Order coverage: The COMPS Order covers all private-sector work in Colorado except for certain exempt jobs and employers (see Section 4). State and local government employees generally are not covered by the COMPS Order but may have FLSA protections. Independent contractors are not covered by either law.
Source: Colorado COMPS Order #40, 7 CCR 1103-1, Rule 1 (Coverage); 2026 COMPS Order Poster — https://cdle.colorado.gov/sites/cdle/files/2026_comps_order_poster_english_%5Baccessible%5D.pdf
How Overtime Pay Is Calculated in Colorado
What Is a “Workweek”?
Under the FLSA, a workweek is a fixed, regularly recurring period of 168 consecutive hours (seven consecutive 24-hour periods). A workweek does not have to start on Monday or align with a calendar week — the employer may designate any day and time as the start of the workweek.
Each workweek stands alone. An employer cannot average hours across two or more workweeks to avoid overtime. If an employee works 50 hours in one week and 30 the next, overtime is owed for the first week regardless of the second.
Colorado follows the same workweek definition under COMPS Order Rule 4.
Source: 29 C.F.R. § 778.104–778.105; COMPS Order #40, Rule 4
Colorado’s Three Overtime Triggers
Under COMPS Order #40, Rule 4, nonexempt employees in Colorado earn overtime at 1.5× their regular rate of pay when any one of these three thresholds is crossed:
Trigger 1 — Weekly overtime: All hours worked over 40 hours in a workweek
Trigger 2 — Daily overtime: All hours worked over 12 hours in a single workday
Trigger 3 — Consecutive-hours overtime: All hours worked over 12 consecutive hours, regardless of where those hours fall across workday boundaries
Important: Whichever overtime trigger produces the greatest amount of overtime pay in a given period is the one that applies. Employers cannot use a lesser trigger to reduce overtime obligations.
Source: COMPS Order #40, Rule 4 — https://cdle.colorado.gov/dlss-home-page/colorado-overtime-minimum-pay-standards-comps-order
What Counts as the “Regular Rate of Pay”
The regular rate is not always the same as the hourly wage. Under the FLSA (29 C.F.R. § 778.108) and the COMPS Order, the regular rate includes:
- Base hourly rate or salary equivalent
- Non-discretionary bonuses and incentive pay
- Shift differentials
- Commissions
- Piece-rate earnings
The regular rate does NOT include:
- Discretionary bonuses (e.g., holiday gifts)
- Employer contributions to benefit plans
- Vacation, holiday, or sick pay when no work is performed
Source: 29 C.F.R. § 778.108–778.122; COMPS Order #40, Rule 4
Calculation Examples
Colorado’s minimum wage in 2026 is $15.16/hour (statewide).
Example 1 — Weekly overtime:
An employee earns $15.16/hour and works 48 hours in one workweek:
- Regular pay: 40 hours × $15.16 = $606.40
- Overtime pay: 8 hours × ($15.16 × 1.5) = 8 × $22.74 = $181.92
- Total weekly gross pay: $788.32
Example 2 — Daily overtime (12-hour workday rule):
An employee earns $15.16/hour and works a 14-hour shift on a single workday:
- Regular pay: 12 hours × $15.16 = $181.92
- Overtime pay: 2 hours × ($15.16 × 1.5) = 2 × $22.74 = $45.48
- Total daily gross pay: $227.40
Example 3 — Consecutive-hours overtime:
An employee earns $15.16/hour and works a shift starting at 11 PM that runs until 1 PM the next day (14 consecutive hours):
- Regular pay: 12 hours × $15.16 = $181.92
- Overtime pay: 2 hours × ($15.16 × 1.5) = 2 × $22.74 = $45.48
- Total gross pay for the shift: $227.40
The consecutive-hours rule applies even though the shift crosses a midnight boundary into a new workday.
Source: COMPS Order #40, Rule 4; 2026 PAY CALC Order, 7 CCR 1103-14 — https://cdle.colorado.gov/dlss/labor-laws-rules-resources/labor-rules-proposed-and-adopted
For the current Colorado minimum wage, see the [Colorado Minimum Wage page ].
Who Is Exempt from Overtime in Colorado?
Not all employees in Colorado are entitled to overtime pay. Certain employees are classified as “exempt” under Colorado and/or federal law.
Federal FLSA Exemption Requirements
To be exempt from overtime under the FLSA, an employee must meet ALL THREE criteria:
1. Salary basis test: Paid a predetermined, fixed salary each pay period (not hourly)
2. Salary level test: Earn at least $684 per week ($35,568 per year)
3. Duties test: Perform specific job duties in one of these categories:
| Colorado Overtime Exemptions — Key Duty Test (2026) | |
|---|---|
| Exemption | Key duty requirement |
| Executive | Manages enterprise or department; directs 2+ employees; authority to hire/fire |
| Administrative | Office/non-manual work related to management or business operations; exercises independent judgment |
| Professional | Work requiring advanced knowledge in science or learning (prolonged specialized study) |
| Computer employee | Systems analysis, programming, software engineering — $684/week salary OR $27.63/hour |
| Outside sales | Primary duty is making sales away from employer's place of business |
Source: 29 C.F.R. Part 541
What Happened to the 2024 DOL Salary Threshold Increase?
In April 2024, the U.S. Department of Labor issued a final rule that would have raised the exempt salary threshold to $1,128 per week ($58,656/year) effective January 1, 2025.
On November 15, 2024, the U.S. District Court for the Eastern District of Texas vacated that rule nationwide in Texas v. U.S. Department of Labor (No. 4:24-cv-00499).
The federal salary threshold remains $684/week ($35,568/year) as of 2026.
Colorado’s Higher Exempt Salary Threshold (2026)
Colorado sets its own, higher salary threshold for overtime exemption under the COMPS Order and PAY CALC Order. As of January 1, 2026:
| Exempt Salary Threshold — Colorado vs Federal (2026) | |
|---|---|
| Amount | |
| Colorado EAP threshold (2026) | $1,111.23/week ($57,784/year) |
| Federal FLSA threshold | $684/week ($35,568/year) |
| Difference | Colorado requires $427.23 more per week to qualify for exemption |
What this means in practice: An employee in Colorado earning between $684/week and $1,111.22/week is exempt under federal law but NOT exempt under Colorado law. Because Colorado law is more favorable to the employee, the Colorado standard applies, and the employer must pay overtime.
Calculation basis: The Colorado EAP threshold adjusts annually based on Colorado’s minimum wage and Consumer Price Index (CPI) adjustments, as prescribed by the PAY CALC Order.
Highly compensated employees (HCE): The annual threshold for the highly compensated employee exemption is $130,014/year in 2026, with a weekly floor of at least $1,111.23/week.
Computer professionals: May be exempt if paid a salary of at least $1,111.23/week (2026) or an hourly rate of at least $34.85/hour (2026).
Doctors, lawyers, and teachers may be exempt based on duties alone, without a minimum salary, consistent with federal law (COMPS Order Rule 2.2).
Source: 2026 PAY CALC Order, 7 CCR 1103-14, § 1.2.1 — https://cdle.colorado.gov/dlss/labor-laws-rules-resources/labor-rules-proposed-and-adopted; COMPS Order #40, Rules 2.2–2.5
States with Higher Exempt Salary Thresholds Than Federal (2026)
| States with Higher Exempt Salary Thresholds Than Federal (2026) | |||
|---|---|---|---|
| State | Weekly threshold (2026) | Annual equivalent | Basis |
| Washington | $1,541.70 | $80,168 | 2× state minimum wage |
| California | $1,352.00 | $70,304 | 2× state minimum wage |
| New York (NYC/Nassau/Suffolk/Westchester) | $1,275.00 | $66,300 | Region-based |
| New York (elsewhere) | $1,199.10 | $62,353 | Region-based |
| Colorado | $1,111.23 | $57,784 | CPI-adjusted annually |
| Maine | $871.16 | ~$45,300 | Min wage-linked |
| Federal | $684.00 | $35,568 | 29 C.F.R. § 541 |
Source: Respective state DOL websites; U.S. DOL Wage and Hour Division — https://www.dol.gov/agencies/whd/overtime/salary-levels
Colorado-Specific Exemptions Under the COMPS Order
Beyond the EAP categories, the COMPS Order exempts or partially exempts certain additional categories of employees. Key examples include:
- 20% owners (or a nonprofit’s highest-paid, highest-ranked employee) who actively manage the business (COMPS Rule 2.2.5)
- Certain resident workers such as babysitters, property managers, and camp/outdoor education field staff (COMPS Rule 2.2.7)
- Bona fide volunteers for nonprofits and work-study students receiving school credit (COMPS Rule 2.2.8)
- Certain ski industry workers who receive food, lodging, and ski passes as partial compensation (partial exemption under Rule 2.4.3)
- Certain healthcare workers subject to special overtime rules (see Section 7 — Industry-Specific Rules)
Source: COMPS Order #40, Rules 2.2–2.4 — https://cdle.colorado.gov/dlss-home-page/colorado-overtime-minimum-pay-standards-comps-order
Overtime Tax Deduction: "No Tax on Overtime" (2025–2028) — and Colorado's Addback
The One Big Beautiful Bill Act (Public Law 119-21), signed on July 4, 2025, created a new federal income tax deduction for qualified overtime compensation under Internal Revenue Code § 225. This deduction is available for tax years 2025 through 2028.
⚠️ Critical Colorado-specific rule: Colorado enacted House Bill 25-1296 (signed May 16, 2025), which requires Colorado taxpayers to add back to their Colorado taxable income any overtime compensation excluded or deducted from federal gross income. This addback is effective for tax years beginning January 1, 2026. The federal overtime deduction reduces federal tax liability but does not reduce Colorado state income tax.
Federal Deduction: Who Is Eligible
- Nonexempt employees covered by the Fair Labor Standards Act (29 U.S.C. § 207)
- Must have a Social Security number valid for employment
- Cannot use the Married Filing Separately filing status
Who is NOT eligible:
- Exempt (salaried) employees who do not receive FLSA overtime
- Independent contractors (1099 workers) who are not FLSA-covered
- Employees receiving overtime only under state law, employer policy, or collective bargaining (if that overtime is not also required by the FLSA)
What Is Deductible (Federal)
The deduction covers the premium portion of overtime pay — specifically the amount that exceeds the regular rate of pay.
| Overtime Tax Deduction — Example ($25/hr Regular Rate) | ||
|---|---|---|
| Overtime type | What is deductible | Example ($25/hr regular rate) |
| Time-and-a-half (1.5×) | The "half" — 1/3 of total OT pay | $12.50/hr per OT hour ($37.50 − $25.00) |
| Double time (2×) | The "full extra" — 1/2 of total OT pay | $25.00/hr per OT hour ($50.00 − $25.00) |
IRS shortcut for 2025: If you only know your total overtime pay and were paid time-and-a-half, divide the total overtime amount by 3. (Source: IRS Notice 2025-69)
| Federal Deduction Limits — Qualified Overtime (2025–2028) | ||
|---|---|---|
| Filing status | Maximum annual deduction | Phase-out begins |
| Single | $12,500 | $150,000 MAGI |
| Married filing jointly | $25,000 | $300,000 MAGI |
| W-2 Reporting — Qualified Overtime Compensation | |
|---|---|
| Tax year | Employer reporting requirement |
| 2025 | NOT required to separately report (transition year — IRS Notice 2025-62). May voluntarily report in W-2 Box 14 as "QUAL OT" or provide a separate statement |
| 2026 and later | REQUIRED to separately report qualified overtime compensation. The IRS has published a draft W-2 form indicating Box 12, Code TT for this purpose (draft form, subject to change before finalization) |
If an employer did not separately report overtime for 2025, the IRS allows employees to use “any reasonable method” to calculate the deductible amount, including one-third of total overtime pay (for time-and-a-half workers), payroll records or pay stubs, or employer statements.
What the Federal Deduction Does NOT Do
- Does NOT exempt overtime from Social Security (6.2%) or Medicare (1.45%) taxes
- Does NOT apply to Colorado state income taxes — see Colorado addback rule below
- Does NOT change how much overtime pay an employee receives — it reduces federal taxable income when filing
- Does NOT apply to overtime paid solely under state law or employer policy that exceeds FLSA requirements
Source: IRS FAQs on Qualified Overtime Compensation Deduction; IRS Notice 2025-69; IRS Notice 2025-62; IRC § 225; P.L. 119-21, § 70202; Schedule 1-A (Form 1040) Official IRS page: https://www.irs.gov/newsroom/questions-and-answers-about-the-new-deduction-for-qualified-overtime-compensation
Colorado State Income Tax and the Overtime Addback
Colorado imposes a flat state income tax at a rate of 4.4% on taxable income (C.R.S. § 39-22-104).
Under HB 25-1296 (effective January 1, 2026), Colorado requires a state income tax addback for the full amount of any overtime compensation deducted on a federal return. This means:
- A Colorado employee claims the federal overtime deduction on IRS Schedule 1-A (Form 1040)
- When filing the Colorado return, the employee must add back that same amount to Colorado federal taxable income
- The net result: the overtime premium is fully subject to Colorado’s 4.4% income tax, with no state-level exemption
This addback is required for the full amount of the federal deduction claimed on IRS Schedule 1-A.
Practical example: A Colorado worker earns $9,000 in qualifying overtime at time-and-a-half. The federal deductible amount is $3,000 (one-third). That $3,000:
- Reduces federal taxable income → saves federal income tax
- Must be added back to Colorado taxable income → Colorado income tax of 4.4% still applies ($132)
Source: Colorado Individual Income Tax Guide (revised January 2026) — https://tax.colorado.gov/individual-income-tax-guide; HB 25-1296 — https://leg.colorado.gov/bills/hb25-1296; Colorado Department of Revenue, January 2026 Tax Policy Updates — https://tax.colorado.gov/january-2026-tax-policy-updates
Legal Challenges to the Colorado Overtime Addback
The Colorado overtime addback has faced legal challenges. Advance Colorado, a conservative advocacy group, filed a lawsuit (Advance Colorado v. Humphreys) in July 2025 alleging that HB 25-1296 violates the Taxpayer’s Bill of Rights (TABOR), which requires voter approval for new taxes. As of the date of this review, the litigation remains pending.
Additionally, a 2026 ballot initiative (Initiative #119) has been filed to allow Colorado voters to repeal the addback for both overtime and tipped wages. The status of this initiative and the litigation may affect the addback’s applicability. Employees and employers should monitor developments.
Source: Initiative #119 — https://leg.colorado.gov/initiatives/119; Colorado General Assembly (SB26 session)
For Colorado state income tax details, see [Colorado Income Tax page — link].
Can an Employer Require Overtime in Colorado?
Under the FLSA, there is no federal limit on the number of hours an employer can require an adult employee (age 16 and older) to work in a workweek, as long as the employee is properly compensated for all overtime hours.
Colorado does not impose a general state-level restriction on mandatory overtime for most workers beyond compensation requirements. Employers in Colorado may require overtime, and at-will employees who refuse may face disciplinary action, including termination.
At-will employment: Colorado is an at-will employment state. Unless an employment contract, collective bargaining agreement, or specific law provides otherwise, an employer may discipline or terminate an employee for refusing to work overtime.
Key exceptions and protections that always apply:
- All overtime hours must be compensated at the applicable overtime rate (COMPS Rule 4)
- Employers cannot retaliate against employees who file wage complaints (29 U.S.C. § 215(a)(3); Colorado WARNING Rules, 7 CCR 1103-11)
- Disability accommodation requests under the ADA may limit overtime requirements
- Child labor laws restrict hours for employees under 18
- Colorado’s COMPS Order explicitly prohibits private-sector employers from offering compensatory time (comp time) in lieu of overtime pay
Source: 29 U.S.C. § 207; COMPS Order #40, Rule 4; Colorado WARNING Rules, 7 CCR 1103-11
Industry-Specific Overtime Rules in Colorado
Agriculture — Special Colorado Overtime Thresholds
Colorado provides overtime protections to agricultural workers that exceed FLSA requirements (which largely exempt agricultural workers from overtime). Under the COMPS Order:
- Standard agricultural overtime: Overtime after 48 hours per workweek (COMPS Rule 2.3.2)
- Highly seasonal agricultural overtime: During designated “peak weeks” (when employer employs at least double its non-peak workforce), overtime begins after 56 hours per workweek. Employers may designate up to 22 peak weeks per year, subject to advance disclosure requirements (COMPS Rule 2.3.2(C))
- Agricultural workers also receive daily overtime and consecutive-hours protections with extra breaks on long workdays
Pending legislation (SB 26-081): A bill introduced in the 2026 session (SB26-081) would increase overtime protections for agricultural employees by requiring the same thresholds that apply to all other covered employees — 40 hours/workweek, 12 hours/workday, or 12 consecutive hours. Status: 2026 Regular Session, introduced. Source: https://leg.colorado.gov/bills/SB26-081
Source: COMPS Order #40, Rule 2.3; Agricultural Labor Rights and Responsibilities page — https://cdle.colorado.gov/dlss/labor-laws-by-topic/agricultural-labor-rights-and-responsibilities
Healthcare — 8-and-80 System
Under 29 U.S.C. § 207(j), hospitals and residential care facilities may elect a 14-day alternative work period. Under this election, overtime is owed after 8 hours per day OR 80 hours in the 14-day period, whichever calculation results in more overtime pay.
The COMPS Order also provides that hospital and nursing home employees paid under the federal 8/80 rule are exempt from Colorado’s 40-hour weekly overtime and 12-hour daily overtime triggers, as those thresholds would already be addressed under the federal 8/80 calculation (COMPS Rule 2.4.5).
Medicaid-funded direct care workers on 24-hour shifts are exempt from the 12-hour consecutive-hours overtime requirement (COMPS Rule 2.4.7).
Source: 29 U.S.C. § 207(j); COMPS Order #40, Rules 2.4.5, 2.4.7
Ski Industry
Ski industry workers who receive food, lodging, and ski passes as a substantial portion of their compensation may qualify for a partial COMPS Order exemption from the 40-hour weekly overtime requirement. These workers remain covered by federal FLSA overtime requirements, which may provide overtime after 56 hours per week for certain residential employees.
Source: COMPS Order #40, Rule 2.4.3
Transportation (Motor Carrier Exemption)
Employees whose duties affect the safe operation of motor vehicles in interstate commerce may be exempt from FLSA overtime under the Motor Carrier Act exemption (49 U.S.C. § 31502). Under COMPS Order Rule 2.4.6 and Rule 2.4.10, certain interstate transport employees are overtime-exempt to varying degrees.
Source: 49 U.S.C. § 31502; COMPS Order #40, Rules 2.4.6, 2.4.10
Compensatory Time (“Comp Time”) Rules
Under the COMPS Order and the FLSA, private-sector employers in Colorado cannot offer compensatory time off in lieu of overtime pay. The COMPS Order explicitly states that employers cannot give time off instead of overtime pay. An employee who works overtime hours must be compensated at 1.5× their regular rate in wages, not in time off.
Public-sector employers (state and local government) may offer compensatory time off instead of overtime pay under 29 U.S.C. § 207(o), provided:
- The comp time accrues at 1.5 hours for each overtime hour worked
- A prior agreement exists between the employer and employee (or union)
- The cap is 240 hours of accrued comp time (or 480 hours for public safety, emergency response, and seasonal employees)
- Employees must be permitted to use accrued comp time within a reasonable period
Source: 29 U.S.C. § 207(o); COMPS Order #40, Rule 4 — https://cdle.colorado.gov/dlss-home-page/colorado-overtime-minimum-pay-standards-comps-order
Public Sector / Government Employees
State and local government employees in Colorado are generally not covered by the COMPS Order. They may be covered by the FLSA, which allows public employers to offer compensatory time in lieu of overtime under 29 U.S.C. § 207(o). State government employees may not file wage claims with the DLSS (except for paid leave claims under the Healthy Families and Workplaces Act).
Source: 29 U.S.C. § 207(o); CDLE Division Authority and Coverage — https://cdle.colorado.gov/dlss/division-authority-and-coverage
How to File an Overtime Wage Complaint in Colorado
Employees in Colorado who believe they have not received proper overtime pay have three options.
Option 1: Colorado Division of Labor Standards and Statistics (DLSS)
| Colorado — Wage & Overtime Complaint Process | |
|---|---|
| Details | |
| Agency | Colorado Department of Labor and Employment, Division of Labor Standards and Statistics |
| Online filing | https://cdle.colorado.gov/complaint |
| Phone | (303) 318-8441 (main) | 1-888-390-7936 (toll-free) |
| cdle_labor_standards@state.co.us | |
| Required form | Labor Standards Complaint Form (available online at filing portal) |
| Deadline | 2 years from violation (3 years if willful) |
| Claims limit | Division cannot investigate claims exceeding $7,500; file in court for larger amounts |
Important procedural notes:
- The Division’s complaint process is a free service available to all employees, regardless of immigration status
- Employees may send a written demand for payment (by mail, email, or text) simultaneously with filing a complaint — no need to wait 14 days
- If wages are not paid within 14 days of a written demand, additional penalties may apply
- The investigation process can take several months
- Government employees (state and local) generally may not file wage claims with the Division
Source: CDLE Demands, Complaints, Responses, and Settlements — https://cdle.colorado.gov/complaint; Division Authority and Coverage — https://cdle.colorado.gov/dlss/division-authority-and-coverage
Option 2: U.S. Department of Labor — Wage and Hour Division
| Federal Wage & Overtime Complaint — Colorado (WHD) | |
|---|---|
| Details | |
| Online | https://www.dol.gov/agencies/whd/contact/complaints |
| Phone | 1-866-487-9243 (toll-free) |
| Denver WHD office | 720-264-3250 |
| Deadline | 2 years from violation (3 years if willful) |
Option 3: Private Lawsuit
Employees may file a lawsuit against their employer in state or federal court under 29 U.S.C. § 216(b) and/or the Colorado Wage Act (C.R.S. § 8-4-101 et seq.). Remedies may include:
- Back wages owed
- Liquidated damages (an additional amount equal to the unpaid wages) under the FLSA
- Colorado-specific penalties (see Section 9 below)
- Reasonable attorney’s fees and court costs
Note: Filing a complaint with the Division and filing a private lawsuit are generally treated as alternative remedies — if a lawsuit has already been filed, the Division may not investigate the same claim.
Retaliation Protection
Under the FLSA (29 U.S.C. § 215(a)(3)) and Colorado’s WARNING Rules (7 CCR 1103-11), employers cannot retaliate against employees for:
- Filing an overtime wage complaint
- Participating in an investigation
- Testifying in proceedings related to overtime violations
- Exercising other protected labor rights
Source: 29 U.S.C. § 216(b); 29 U.S.C. § 215(a)(3); Colorado WARNING Rules, 7 CCR 1103-11 — https://cdle.colorado.gov/dlss/labor-laws-rules-resources/labor-rules-proposed-and-adopted
Penalties for Overtime Violations in Colorado
| Federal FLSA Penalties | |
|---|---|
| Penalty type | Amount |
| Back wages | Full amount of unpaid overtime owed |
| Liquidated damages | Equal to unpaid wages (effectively doubles recovery) |
| Civil monetary penalty | Up to $2,451 per violation for willful or repeated violations (adjusted annually) |
| Criminal prosecution | Willful violations: fines up to $10,000; second offense: up to 6 months imprisonment |
Source: 29 U.S.C. § 216
Colorado Wage Act Penalties (C.R.S. § 8-4-109)
Colorado’s penalty structure is triggered when wages are not paid within 14 days of a written demand:
| State Civil Penalties — Unpaid Overtime | |
|---|---|
| Violation type | Penalty |
| Non-willful | The greater of 2× the unpaid wages or $1,000 |
| Willful | The greater of 3× the unpaid wages or $3,000 |
A violation is automatically considered willful if the employer commits a similar violation within five years of a prior violation (C.R.S. § 8-4-109(3)(c)).
Statute of limitations under Colorado law: 2 years from the date wages were due and payable (3 years for willful violations), under C.R.S. § 8-4-122.
Additional note on claims over $7,500: The DLSS cannot administratively investigate claims exceeding $7,500. Employees with larger claims should pursue them in the appropriate court and may wish to consult an attorney.
Source: C.R.S. § 8-4-109; C.R.S. § 8-4-122; CDLE Division Authority and Coverage — https://cdle.colorado.gov/dlss/division-authority-and-coverage
Colorado Overtime Law Updates (2025–2026)
Federal Changes Affecting Colorado
- July 4, 2025: One Big Beautiful Bill Act (P.L. 119-21) signed — created federal overtime tax deduction for tax years 2025–2028 (IRC § 225)
- November 15, 2024: DOL salary threshold rule vacated by federal court in Texas v. U.S. Department of Labor — exempt threshold remains $684/week ($35,568/year) federally
Colorado-Specific Changes (2025–2026)
- February 1, 2026: COMPS Order #40 (7 CCR 1103-1) and 2026 PAY CALC Order (7 CCR 1103-14) took effect. Key changes include:
- State minimum wage increased from $14.81 to $15.16/hour
- EAP exempt salary threshold increased from $1,086.25/week ($56,485/year) to $1,111.23/week ($57,784/year)
- Highly compensated employee (HCE) threshold increased from $127,091 to $130,014/year
- Computer professional hourly threshold increased to $34.85/hour
- January 1, 2026: HB 25-1296 addback provision effective — Colorado taxpayers must add back federal overtime deduction to state taxable income
- May 16, 2025: HB 25-1296 signed by Governor Polis — established the Colorado overtime compensation deduction addback for state income tax purposes
- August 6, 2025: HB 25-1001 amended the Colorado Wage Act — broadened “employer” definition to include individuals owning or controlling at least 25% of a business, and established automatic fines for worker misclassification
Pending Legislation
- SB 26-081 (2026 session): Would increase overtime protections for agricultural employees to the same thresholds applicable to all other COMPS-covered workers (40 hours/workweek; 12 hours/workday; or 12 consecutive hours), eliminating the current 48-hour and 56-hour agricultural overtime thresholds. Status: Introduced, 2026 Regular Session. Source: https://leg.colorado.gov/bills/SB26-081
- Initiative #119 (2026 ballot): Would repeal Colorado’s overtime and tips addback requirement under HB 25-1296, potentially allowing Colorado taxpayers to benefit from the federal overtime deduction at the state level as well. Status: Filed for 2026 ballot. Source: https://leg.colorado.gov/initiatives/119
Last reviewed: February 28, 2026 Next scheduled review: May 31, 2026
Frequently Asked Questions About Overtime in Colorado
Does Colorado have its own overtime law?
Yes. Colorado has its own comprehensive overtime law under the Colorado Overtime and Minimum Pay Standards (COMPS) Order, currently COMPS Order #40 (7 CCR 1103-1). Colorado law goes beyond the federal FLSA by requiring overtime after 12 hours in a workday or 12 consecutive hours, and by setting a higher exempt salary threshold.
What is the overtime rate in Colorado in 2026?
The overtime rate in Colorado is 1.5 times the employee’s regular rate of pay. Based on the Colorado minimum wage of $15.16/hour in 2026, the minimum overtime rate is $22.74/hour. Colorado does not require double time.
Does Colorado require daily overtime?
Yes. Under COMPS Order #40, Rule 4, Colorado requires overtime after 12 hours worked in a single workday. Additionally, overtime is owed after 12 consecutive hours regardless of workday boundaries. These daily and consecutive-hours triggers are in addition to the standard 40-hour weekly trigger.
Is mandatory overtime legal in Colorado?
Under federal law, employers can generally require adult employees to work overtime, and Colorado does not impose a general state-level limit on mandatory overtime hours for most workers. Employers may require overtime, and at-will employees who refuse may face disciplinary action. However, all overtime hours must be compensated at the applicable overtime rate, and employers cannot retaliate against employees who file wage complaints.
Am I exempt from overtime in Colorado?
Exemption depends on both salary level and job duties. Under Colorado law, employees must earn at least $1,111.23/week ($57,784/year) on a salary basis AND perform executive, administrative, or professional duties to be exempt. Colorado’s threshold is substantially higher than the federal minimum of $684/week, meaning many employees who might be exempt under federal law are still entitled to overtime under Colorado law.
Can salaried employees get overtime in Colorado?
Yes. Being paid a salary does not automatically make an employee exempt from overtime. Salaried employees who earn less than $1,111.23/week or who do not meet the Colorado duties tests are nonexempt and entitled to overtime pay under the COMPS Order.
Is overtime taxed in Colorado?
Overtime pay is subject to both federal and Colorado state income taxes. Under the One Big Beautiful Bill Act (2025–2028), FLSA-covered nonexempt employees may deduct up to $12,500 ($25,000 if married filing jointly) of the premium portion of overtime from federal taxable income. However, Colorado enacted HB 25-1296, which requires a full addback of that federal deduction when calculating Colorado taxable income. Colorado’s flat income tax rate of 4.4% applies to overtime compensation.
How does the Colorado overtime addback work?
Under HB 25-1296 (effective January 1, 2026), any amount of overtime deducted from federal gross income on IRS Schedule 1-A must be added back when calculating Colorado taxable income. For example, if you claim a $3,000 federal overtime deduction, you must add $3,000 back on your Colorado DR 0104 return, resulting in a Colorado state tax liability of approximately $132 (4.4% of $3,000) on that amount.
How do I calculate the overtime tax deduction?
For time-and-a-half pay, the deductible amount is one-third of total overtime pay. For example, if you earned $9,000 in total overtime at time-and-a-half, the qualified overtime compensation is $3,000. The IRS confirms this method in Notice 2025-69. For Colorado, that same $3,000 must be added back on your state return.
How do I file an overtime complaint in Colorado?
File a wage claim with the Colorado Division of Labor Standards and Statistics online at https://cdle.colorado.gov/complaint or by calling (303) 318-8441 or 1-888-390-7936. You may also file with the U.S. DOL Wage and Hour Division at 1-866-487-9243. The FLSA statute of limitations is 2 years (3 years for willful violations); the Colorado Wage Act statute of limitations is also 2 years (3 years for willful violations) under C.R.S. § 8-4-122.
Can my employer fire me for refusing overtime in Colorado?
In most cases, yes. Colorado is an at-will employment state, and employers may discipline or terminate employees who refuse overtime, unless a law, employment contract, or collective bargaining agreement provides otherwise. However, employers cannot retaliate against employees who file overtime complaints.
Can my employer give comp time instead of overtime pay in Colorado?
No. Private-sector employers in Colorado cannot offer compensatory time off in lieu of overtime pay. The COMPS Order explicitly prohibits this practice. Public-sector employers (state and local government) may offer comp time at 1.5 hours per overtime hour under 29 U.S.C. § 207(o), subject to applicable caps.
Does working on weekends or holidays count as overtime in Colorado?
No. Under both the FLSA and Colorado’s COMPS Order, working on weekends or holidays does not automatically constitute overtime. Overtime in Colorado depends on total hours worked in the workweek (over 40), in a single workday (over 12), or consecutively (over 12 consecutive hours), regardless of which days those hours occurred.
What happens if my employer doesn’t pay overtime in Colorado?
Employees may recover unpaid overtime wages. Under the Colorado Wage Act, if the employer fails to pay within 14 days of a written demand, the employee may recover the greater of 2× the unpaid wages or $1,000 (or 3×/$3,000 for willful violations). Under the FLSA, employees may recover unpaid wages plus equal liquidated damages, plus attorney’s fees. The DLSS complaint process is free.
What is the statute of limitations for overtime claims in Colorado?
Under the FLSA: 2 years (3 years if the violation is willful). Under the Colorado Wage Act (C.R.S. § 8-4-122): 2 years (3 years if willful). The statute of limitations begins running on the date each set of wages first became due and payable, not the date of separation from employment.
Are agricultural workers entitled to overtime in Colorado?
Yes — Colorado provides overtime protections for agricultural workers that exceed federal law. Most Colorado agricultural workers earn overtime after 48 hours per workweek (or 56 hours during designated peak weeks for highly seasonal employers). Pending legislation (SB 26-081) would extend full COMPS overtime thresholds — 40 hours/week, 12 hours/day, or 12 consecutive hours — to agricultural workers.
What is Colorado’s minimum salary to be exempt from overtime?
In 2026, employees must earn at least $1,111.23/week ($57,784/year) on a salary basis to qualify for the executive, administrative, or professional (EAP) exemption from Colorado overtime. This is significantly higher than the federal threshold of $684/week ($35,568/year). The Colorado threshold adjusts annually.
Sources and Verification
Primary Sources
- COMPS Order #40, 7 CCR 1103-1 — Colorado Department of Labor and Employment https://cdle.colorado.gov/dlss-home-page/colorado-overtime-minimum-pay-standards-comps-order
- 2026 PAY CALC Order, 7 CCR 1103-14 — Colorado Department of Labor and Employment https://cdle.colorado.gov/dlss/labor-laws-rules-resources/labor-rules-proposed-and-adopted
- Colorado Overtime Page — CDLE Division of Labor Standards and Statistics https://cdle.colorado.gov/dlss-home-page/wage-and-hour-law/overtime
- Colorado Wage Act — C.R.S. § 8-4-101 et seq. https://leg.colorado.gov/laws/colorado-revised-statutes
- Colorado Wage Act Penalties — C.R.S. § 8-4-109
- Colorado Wage Act Statute of Limitations — C.R.S. § 8-4-122
- Agricultural Labor Rights and Responsibilities — CDLE https://cdle.colorado.gov/dlss/labor-laws-by-topic/agricultural-labor-rights-and-responsibilities
- 2026 COMPS Order Poster (English) https://cdle.colorado.gov/sites/cdle/files/2026_comps_order_poster_english_%5Baccessible%5D.pdf
- Colorado Demands, Complaints, Responses, and Settlements — CDLE https://cdle.colorado.gov/complaint
- Colorado Division Authority and Coverage — CDLE https://cdle.colorado.gov/dlss/division-authority-and-coverage
- Colorado Individual Income Tax Guide — Colorado Department of Revenue https://tax.colorado.gov/individual-income-tax-guide
- January 2026 Tax Policy Updates — Colorado Department of Revenue https://tax.colorado.gov/january-2026-tax-policy-updates
- HB 25-1296 — Colorado General Assembly https://leg.colorado.gov/bills/hb25-1296
- SB 26-081 — Colorado General Assembly https://leg.colorado.gov/bills/SB26-081
- Initiative #119, State Tax on Tips and Overtime Pay — Colorado General Assembly https://leg.colorado.gov/initiatives/119
- U.S. Department of Labor, Wage and Hour Division — Overtime https://www.dol.gov/agencies/whd/overtime
- Fair Labor Standards Act — 29 U.S.C. § 201–219
- 29 C.F.R. Part 541 (Overtime Exemptions)
- Internal Revenue Service — Overtime Tax Deduction FAQs https://www.irs.gov/newsroom/questions-and-answers-about-the-new-deduction-for-qualified-overtime-compensation
- IRS Notice 2025-69 (Individual Calculation Guidance for Overtime Deduction)
- IRS Notice 2025-62 (Employer Reporting Transition Relief for 2025)
- Schedule 1-A, Form 1040 (Claiming the Overtime Deduction)