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• On July 1–2, 2025, the DOL published notices to either rescind or amend the 2013 rule that narrowed the Fair Labor Standards Act (FLSA) companionship services and live-in domestic service exemptions. The department is considering returning to the broader 1975 regulations, which are more favorable to third-party providers like home care agencies. Comments are due by September 2, 2025.
• On July 1, 2025, the Office of Federal Contract Compliance Programs (OFCCP) proposed rescinding the implementing regulations of Executive Order (E.O.) 11246. This removes affirmative action and nondiscrimination requirements for federal contractors relating to race, gender identity, sexual orientation, etc., as mandated by E.O. 14173 (issued January 21, 2025).
• July 2, 2025: DOL proposed amending H-2A regulations to roll back certain burdensome requirements—such as progressive discipline provisions and expanded anti-retaliation measures initially introduced in April 2024.
In June 2025, the U.S. Supreme Court unanimously ruled in Ames v. Ohio Department of Youth Services that Title VII of the Civil Rights Act applies equally to all employees, regardless of whether they belong to a minority or majority group. The Court struck down the requirement, used in some circuits, that “majority” plaintiffs (such as white or heterosexual employees) had to provide extra proof of discrimination beyond what minority-group plaintiffs needed. Moving forward, all employees face the same legal standard when bringing discrimination claims. This makes it easier for majority-group workers to pursue “reverse discrimination” cases and signals to employers that policies and practices must be applied consistently and fairly to everyone.
• Equal Standards: All employees—minority or majority—are evaluated under the same Title VII framework. • No Extra Burden: Majority-group plaintiffs no longer need to show “background circumstances” suggesting an employer discriminates against the majority.
• Increased Risk: Expect more reverse discrimination claims, especially around promotions, hiring, and DEI initiatives. • Policy Review Needed: Ensure that diversity, equity, and inclusion programs, as well as HR policies, are applied consistently to avoid claims of favoritism.
• Defensible Decisions: Employers should carefully document hiring, promotion, and disciplinary actions with clear, job-related reasons.
• Unanimous Decision: The Court’s 9–0 ruling (with a concurrence by Justices Thomas and Gorsuch) makes this a strong and lasting precedent.
Beginning August 6, 2025, Colorado employers will face heightened wage and hour compliance obligations as House Bill 25- 1001 takes effect. This law significantly amends the Colorado Wage Claim Act, strengthening enforcement mechanisms and increasing both organizational and personal liability for wage violations.
• Expanded Enforcement and Liability
o The law broadens the Department of Labor and Employment’s authority to investigate and enforce wage violations.
o Employers face higher risks of penalties and back-pay claims if wage obligations are not met.
• Personal Liability for Owners
o Any individual owning or controlling 25% or more of a business can now be held personally liable for unpaid wages.
o This change underscores the need for proactive compliance at both the ownership and management level. • Compliance Incentives & Penalties
o HB 25-1001 introduces civil penalty waivers for employers who voluntarily correct violations.
o However, failure to act proactively may result in escalated penalties, making compliance planning even more critical.
Colorado businesses must take immediate steps to update policies, payroll practices, and recordkeeping procedures to minimize risk:
• Conduct internal wage and hour audits.
• Review ownership structures to assess potential personal liability.
• Train HR, payroll, and management staff on compliance requirements.
• Implement proactive correction policies to take advantage of penalty waivers.
Employers should consult official state resources to ensure compliance:
• Colorado Department of Labor and Employment – Wage and Hour Division: https://cdle.colorado.gov/wage-and hour-law
• Colorado General Assembly – Bill Information for HB 25-1001: https://leg.colorado.gov/bills/hb25-1001
• HB25-004 was advanced during the August 2025 special legislative session, shifting Colorado’s groundbreaking AI law enforcement date from February 1, 2026, to June 30, 2026. This move gives lawmakers additional time to refine policy details and allows businesses more breathing room.
• The delayed start eases immediate compliance burdens on employers and system developers, while preserving the core framework of regulation—clearly signaling ongoing momentum for eventual implementation.
• Compliance Timeline
Employers should now expect enforcement of the AI law by June 30, 2026, rather than February. This gives organizations more time to build and test compliance procedures.
• No Major Policy Revisions Yet
Although conversations continue about narrowing obligations or shifting liability standards (e.g., focusing enforcement via consumer protection laws), no changes have yet been passed. Businesses should prepare based on the law as originally drafted.
• Stay Alert & Prepared
With further debate expected during the upcoming 2026 regular session, employers should:
o Track legislative developments,
o Integrate flexibility into compliance planning,
o And consult with legal counsel to anticipate different regulatory scenarios.
• Prepare proactively: Even with the delay, you can inventory AI systems, assess their potential impact (especially in employment decisions), and begin developing or contracting for oversight and disclosure procedures.
In May 2025, Governor Jared Polis signed House Bill 25-1296, known as the Tax Expenditure Adjustment Bill. Among various changes, the legislation explicitly decouples Colorado’s tax treatment of overtime pay from the new federal deductions, effectively ensuring that any federal overtime pay exempted under the “One Big Beautiful Bill” (OBBBA) will still be taxable at Colorado’s 4.4% rate. Notably, the law does not override the federal treatment for tip income—if tips are excluded at the federal level, Colorado will continue to allow that deduction.
• Federal Law (One Big Beautiful Bill, enacted July 4, 2025):
Permits deductions of up to $12,500 for single filers and $25,000 for joint filers on overtime income, and similar deductions for tip income for tax years 2025 – 2028
• Colorado’s Tax Treatment (HB 25-1296):
o Overtime Income: Any overtime compensation excluded from federal taxable income must be added back into Colorado taxable income and remains subject to the state’s 4.4% tax.
o Tip Income: Colorado continues to follow federal treatment. If tips are excluded federally, they are also excluded on the state return.
• Advance Colorado Lawsuit:
Advance Colorado has filed a lawsuit in Denver District Court challenging HB 25-1296, contending that adding back federal overtime exclusions constitutes a TABOR violation, as it imposes a de facto tax increase without voter approval
• 2026 Ballot Initiative (Initiative #119):
A campaign is underway to put a measure on the 2026 ballot aiming to permanently exempt overtime and tip income from Colorado income tax.
9/30 – Summary Annual Report (SAR) Deadline for Calendar Year Plans
9/30 – Vets-4212 Filing deadline (federal contractors)
10/1 – QSEHRA Notice Deadline (Calendar Year Plans Only)
10/15 – Medicare Part D Creditable/Noncreditable Coverage Notice
10/31 – Form 941 Filing Deadline for Q3
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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.
