Colorado Compliance Connection - April 2026

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Federal Compliance Update 

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ICE Changes Several Form I-9 Technical Violations to Substantive Violations

On March 16, 2026, the U.S. Immigration and Customs Enforcement (ICE) updated its Form I-9 Inspection Under Immigration and Nationality Act Section 274A fact sheet, changing more than 10 categories of technical Employment Eligibility Verification form (Form I-9) violations to substantive violations. Substantive violations can result in immediate fines of $288 to $2,861 per violation. 

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Background

Federal law requires employers to hire only individuals who may legally work in the United States—either U.S. citizens or authorized foreign nationals.  To comply with the law, employers must verify the identity and employment authorization of each individual they hire by completing and retaining the Form I-9.  Authorized federal officials can conduct worksite enforcement investigations and request copies of all Forms I-9 for any reason.  If that happens, employers must have the original forms available on-site within three days of the request.  ICE will review each Form I-9 to identify any substantive or technical paperwork violations and all employees the employer knowingly hired or continued to employ without authorization.

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Paperwork violations are among the most common Form I-9 violations.  There are two types of paperwork violations: substantive and technical.  Substantive violations, such as failing to verify identity and employment authorization documents, carry immediate fines.  Technical errors, such as missing a date or failing to complete afield, can be corrected within 10 business days of receiving notice of the errors.  However, after the correction period ends, uncorrected technical errors become substantive violations.

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Key Highlights

The fact sheet converts several technical violations to substantive violations, including the following:

• Missing employee date of birth;
• Missing Alien Registration Number/U.S. Citizenship and Immigration Services Number;
• Missing date next to employee’s signature;
• Missing work authorization expiration date;
• Completion of the Spanish-language form outside of Puerto Rico;
• Missing name or title of employer representative;
• Incomplete document information in Section 2 (e.g., title, number, issuing authority, expiration);
• Missing first day of employment;
• Incomplete preparer or translator information;
• Failure to check the alternative procedure box or use of remote verification without active E-Verify enrollment
• Electronic I-9 system deficiencies (e.g., audit trails, e-signatures, security documentation).

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In addition, retaining a copy of an employee’s identity or work authorization document does not cure missing or incomplete information on the Form I-9. 

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Employers may still correct technical errors within the 10-day cure window, such as failure to record the employee’s name on the top of page 2, failure to record the business name or address in Section 2, and failure to record an employee’s other last names or physical address in Section 1 after receiving a notice from ICE.

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Employer Takeaway

Employers that fail to properly complete or retain Forms I-9 can be subject to costly civil monetary penalties.  Fine scan range from a few hundred dollars to several million dollars, depending on the offense and the frequency of offenses.  Employers should review the updated fact sheet and consider conducting an internal Form I-9 audit to identify and correct any paperwork errors before any federal worksite enforcement investigations.  Employers should also review their processes for completing and retaining Forms I-9 to reduce the risk of errors and violations.

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DOJ Issues Order to Reschedule Certain Marijuana Products to Schedule III Drugs

On April 22, 2026, the U.S. Department of Justice (DOJ) announced a final order for certain marijuana and marijuana-containing products to be rescheduled from Schedule I to Schedule III of the Controlled Substances Act (CSA). Schedule III drugs are considered less dangerous and are much less strictly controlled than Schedule I drugs.  The Drug Enforcement Administration (DEA) will also hold a hearing, beginning on June 29, 2026, on the broader rescheduling of marijuana.

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Background

Historically, marijuana has been controlled under Schedule I of the CSA.  In general, drugs, substances and certain chemicals used to make drugs are classified under five distinct schedules depending on the drug’s acceptable medical use or dependency potential.  Schedule I drugs are defined as drugs with no currently accepted medical use and a high potential for abuse.

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On Dec. 18, 2025, President Donald Trump issued an executive order calling for the rescheduling of marijuana to a Schedule III drug.

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Overview of the DOJ Order

In response to Trump’s executive order, the DOJ order reschedules marijuana products that have been approved by the U.S. Food and Drug Administration (FDA) from Schedule I to Schedule III of the CSA.  Generally, this includes marijuana, marijuana extracts, delta-9-tetrahydrocannabinol and other compounds derived from the marijuana plant that fall outside the definition of hemp, to the extent these are included in an FDA-approved drug product or are subject to a state-issued license to manufacture, distribute or dispense marijuana or marijuana-containing products for medical purposes.  The order does not legalize marijuana for recreational purposes at the federal level and does not affect the legalization of marijuana at the state level. 

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However, beginning on June 29, 2026, the DEA will hold a hearing to consider the broader rescheduling of marijuana from Schedule I to Schedule III. According to the DOJ, the hearing “will provide a timely and legally compliant pathway to evaluate broader changes to marijuana’s status under federal law.”

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Employer Takeaways

The rescheduling may have implications for employers, particularly those with employees in safety-sensitive roles, such as drivers of commercial vehicles.  Therefore, employers should monitor for updates on the rulemaking process and potential effects on workplace operations.  Employers should also monitor the DEA hearing for potential implications for employers.

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State Compliance Update

Update on Colorado Employment Law Proposed Legislation

HB26 – 1005  Worker Protection Collective Bargaining https://leg.colorado.gov/bills/HB26-1005 - under consideration

What It Would Mean to Employers

• Likely expands collective bargaining rights and/or modifies union-related procedures.
• May impact how employers engage with unions, employee organizing efforts, and labor negotiations.

What Employers Should Be Aware Of

• Changes to union election processes or thresholds.
• Expanded worker protections related to organizing activity.
• Potential updates to employer communication restrictions during organizing campaigns.

Why It Matters to Businesses

• Could increase unionization activity and collective bargaining obligations.
• May impact operational flexibility, labor costs, and compliance requirements.
• Requires proactive HR training and updated labor relations strategies.

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HB26 – 1010  Older Adult Support & Representation In Workforce https://leg.colorado.gov/bills/HB26-1010 - under consideration

What It Would Mean to Employers

• Impacts employers in healthcare, social services, and aging-related workforce sectors.
• May create new workforce development programs or staffing requirements.

What Employers Should Be Aware Of

• Potential certification, staffing, or funding changes.
• New training or reporting obligations tied to elder care services.

Why It Matters to Businesses

• Could increase compliance requirements for long-term care and related industries.

May create workforce funding opportunities or subsidies.

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HB26 – 1054  Protections for Worker Safety https://leg.colorado.gov/bills/HB26-1054 - under consideration

What It Would Mean to Employers

• Likely expands workplace safety standards or enforcement authority.
• May increase employer liability for unsafe conditions.

What Employers Should Be Aware Of

• New safety protocols, documentation requirements, or penalty structures.
• Expanded whistleblower protections.

Why It Matters to Businesses

• Increased compliance costs and potential enforcement risk.
• Greater exposure to claims and penalties for noncompliance.

HB26 – 1054  Protections for Worker Safety https://leg.colorado.gov/bills/HB26-1054 - passed

What It Would Mean to Employers

• Likely expands workplace safety standards or enforcement authority.
• May increase employer liability for unsafe conditions.

What Employers Should Be Aware Of

• New safety protocols, documentation requirements, or penalty structures.
• Expanded whistleblower protections.

Why It Matters to Businesses

• Increased compliance costs and potential enforcement risk.
• Greater exposure to claims and penalties for noncompliance.

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HB26 – 1143  Non-Employment Educational Opportunities Background Check Information https://leg.colorado.gov/bills/HB26-1143 - under consideration

What It Would Mean to Employers

• Clarifies use of background checks in educational or training contexts.

What Employers Should Be Aware Of

• Limitations on how background check information can be accessed or shared.
• Potential privacy and data-handling changes.

Why It Matters to Businesses

• Impacts employers offering internships, apprenticeships, or educational programs.
• Requires review of screening policies.

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HB26 – 1207  Disclosure of Demographic Workforce Data https://leg.colorado.gov/bills/HB26-1207 - under consideration

What It Would Mean to Employers

• Likely requires workforce demographic reporting.

What Employers Should Be Aware Of

• Expanded reporting to state agencies.
• Increased pay equity or diversity transparency obligations.

Why It Matters to Businesses

• Heightened public scrutiny around workforce diversity.
• Increased compliance and data management burdens.

HB26 – 1210  Prohibit Surveillance Price & Wage Setting https://leg.colorado.gov/bills/HB26-1210 - under consideration

What It Would Mean to Employers

• Could restrict use of algorithmic tools for wage or price setting.
• Impacts businesses using workforce analytics software.

What Employers Should Be Aware Of

• Limits on AI or third-party benchmarking platforms.
• Antitrust or wage-fixing compliance implications.

Why It Matters to Businesses

• Significant impact on compensation strategy and pricing models.
• May require vendor review and compliance audits.

HB26 – 1272  Extreme Temperatures Worker Protections https://leg.colorado.gov/bills/HB26-1272 - under consideration

What It Would Mean to Employers

• Establishes standards for working in extreme heat or cold.

What Employers Should Be Aware Of

• Required breaks, hydration, temperature monitoring, or schedule adjustments.
• Increased OSHA-style enforcement exposure.

Why It Matters to Businesses

• Major operational impact for construction, agriculture, warehouse, and outdoor industries.
• Increased costs for safety compliance.

SB26 – 045  Nuclear Workforce Development & Education Program https://leg.colorado.gov/bills/SB26-045 - under consideration

What It Would Mean to Employers

• Creates workforce development pathways in nuclear energy fields.

What Employers Should Be Aware Of

• Potential grant funding or training partnerships.

Why It Matters to Businesses

• Workforce pipeline development for energy-sector employers.
• May offer recruitment and training incentives.

SB26 – 047  Colorado Firefighter Safety Act Petition Elections https://leg.colorado.gov/bills/SB26-047 - became law

What It Would Mean to Employers

• Impacts municipalities and fire protection districts.
• Alters petition/election procedures related to firefighter safety measures.

What Employers Should Be Aware Of

• Public sector labor implications.

Why It Matters to Businesses

• Indirect impact through municipal funding, taxes, or compliance expectations.

SB26 – 052  Coal Transition Community Investment https://leg.colorado.gov/bills/SB26-052 - became law

What It Would Mean to Employers

• Provides economic support to coal-transition communities.

What Employers Should Be Aware Of

• Grant or investment opportunities.

Why It Matters to Businesses

• Affects economic development, workforce availability, and local tax structures.

SB26 – 081  Increase Agricultural Employee Overtime Protections https://leg.colorado.gov/bills/SB26-081 - lost

What It Would Mean to Employers

• Expands overtime protections for agricultural workers.

What Employers Should Be Aware Of

• Lower overtime thresholds.
• Payroll system adjustments.
• Increased wage costs.

Why It Matters to Businesses

• Direct financial impact on farms and agricultural employers.
• Potential restructuring of scheduling practices.

SB26 – 087  Create Legislative Leave Job Protection for General Assembly Members https://leg.colorado.gov/bills/SB26-087 - under consideration

What It Would Mean to Employers

• Requires job-protected leave for employees serving in the General Assembly.

What Employers Should Be Aware Of

• Leave administration requirements.
• Benefit continuation obligations.

Why It Matters to Businesses

• Workforce planning implications.
• Potential backfill and temporary staffing costs.

SB26 – 093  Workers’ Compensation Insurance Coverage Verification https://leg.colorado.gov/bills/SB26-093 - under consideration

What It Would Mean to Employers

• Establishes or strengthens verification of workers’ comp coverage.

What Employers Should Be Aware Of

• Documentation and proof-of-coverage requirements.
• Increased enforcement mechanisms.

Why It Matters to Businesses

• Ensures compliance oversight.
• Reduces uninsured employer risk exposure but increases administrative obligations.

Compliance Calendar

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May

Nothing for May

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June

06/01 – Prescription Drug Data Collection Reporting

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July

7/31 – Form 5500 Filing Deadline (Calendar Year Plans)

7/31 – PCORI Fee Deadline

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Disclaimer:

Lighthouse HR Support (LHRS) provides practical human resource information and guidance based upon our knowledge and experience in the industry and with our clients.  LHRS services are not intended to be a substitute for legal advice.  LHRS services are designed to provide general information to human resources and/or business professionals regarding human resource concerns commonly encountered.  Given the changing nature of federal, state, and local legislation and the changing nature of court decisions, LHRS cannot and will not guarantee that the information is completely current or accurate.  LHRS services do not include or constitute legal, business, international, regulatory, insurance, tax, or financial advice.  Use of our services, whether by phone, email or in person shall indicate your acceptance of this knowledge.  Information provided in part by Mineral and Zywave.  

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