535 Grand Avenue, Grand Junction, CO 81501

Colorado Compliance Connection - June 2024

June 1, 2024

Federal Compliance Connection

Federal: DOL Increases Exempt Employee Minimum Salaries

On April 26, 2024, the U.S. Department of Labor (DOL) published the much-anticipated final rule that will increase the minimum salary for many exempt employees. The increase will take effect in two steps. If you’d like to review the regulations yourself, they are available here—the relevant changes start on page 130 of the downloadable PDF.

Executive, Administrative, and Professional Employees

Under the new rule, exempt executive, administrative, and professional employees (often referred to collectively as “EAP” employees) must be paid at least:

  • $844 per week ($43,888 per year) beginning on July 1, 2024
  • $1,128 per week ($58,656 per year) beginning on January 1, 2025


Teachers and practicing doctors and lawyers are exempt from these minimum salary requirements under federal law but may be subject to different state minimums. School specific minimums apply to academic administrative employees.

Computer Employees

Exempt computer employees can be paid on a salary or hourly basis. If salaried, they’re considered part of the EAP group and need to make the minimums listed above. Alternatively, they can be paid at least $27.63 per hour—this hourly rate was not changed by the rule.

Highly Compensated Employees (HCE)

Employees who are exempt under the HCE exemption must be paid at least the minimums listed above on a salary basis and receive total annual compensation of at least:

  • $132,964 per year beginning July 1, 2024
  • $151,164 per year beginning January 1, 2025

State Law

As usual, if a state law requires higher minimum salaries than what is required by the federal rule, the state minimums must be followed.

Future Increases

The rule implements automatic updates to the minimum salary levels every three years starting July 1, 2027. We don’t know what the future minimums will be, but employers will have at least 150 days’ notice before those changes take effect.

Potential Challenges

The last time the DOL attempted a significant change to the salary minimums, the rule was challenged and ultimately blocked just weeks before taking effect. While we have no way of predicting if that will happen again, it’s very likely that this final rule will be litigated.

What To Do Now

Employers have the following options:

  • Ensure that salaried exempt employees make at least the new minimum salary required for their classification.
  • Reclassify currently exempt employees as nonexempt and provide them with the rights and benefits that nonexempt employees are entitled to (e.g., minimum wage and overtime pay).

Federal: Prescription Drug Data Collection Reporting Update

The Consolidated Appropriations Act, 2021 (CAA), Title II, Division BB, included a new annual reporting requirement for group health plans and health insurers to report certain specified data related to prescription drugs and other healthcare spending, known as the prescription drug data collection (RxDC). The 2023 reference year (calendar year) RxDC data report is due by June 3, 2024. Typically, carriers, third-party administrators, or pharmacy benefit managers submit the data on behalf of a plan sponsor and therefore may request additional information from employers to complete the process.

The Centers for Medicare and Medicaid Services (CMS) published the 2023 reference year instructions. The key updates include:

  • Exclusion of certain products: Clarification that medical devices, nutritional supplements, and over-the-counter drugs are to be excluded from the prescription drug lists (sections D3, D4, D5, D7, and D8) unless the product’s National Drug Code (NDC) is listed on the CMS Drug and Therapeutic Class Crosswalk.
  • Simplification of premium calculation: The method for calculating the average monthly premium has been simplified. Instead of calculating this on a per-member basis, the total annual premium is now divided by 12.
  • Modification of premium equivalents calculation: The calculation for premium equivalents has been simplified by removing the requirement to report on a cash basis and using paid claims rather than incurred claims.
  • Updates to benefit carve-out field: Instructions for filling out the benefit carve-out field in section P2 have been updated.
  • Clarification on reporting prior year and restated rebates: Additional details have been provided on how to report information in the prior year columns in section D5 and the restated rebate columns in sections D6, D7, and D8.
  • Guidance on retained rebate reporting: New instructions have been provided for reporting entities on how to report information on retained rebates when exact amounts are unknown.
  • Submission of large data files: Instructions on how to submit data when plan list or data files exceed the maximum allowable size limit in the Health Insurance Oversight System (HIOS) have been included.
  • Enforcement of aggregation restriction: The enforcement of the aggregation restriction has been announced, which pertains to how data are aggregated for reporting purposes.

Addition of enrollment column to D6: A new column to collect enrollment data has been added to section D6.

Read more on the CMS Prescription Drug Data Collection (RxDC) webpage, and see the GHP: Prescription Drug Data Collection and Reporting page.

State Compliance Update

Applicant Age-Related Inquiries Prohibited

Beginning July 1, 2024, employers will be prohibited from asking for an applicant’s age, birth date, or school attendance or graduation dates on an initial job application. These limitations don’t apply to applications for jobs that will be performed entirely outside of Colorado.

However, employers can ask applicants to verify their compliance with certain age requirements imposed by the following:

  • A bona fide occupational qualification (BFOQ) related to public or occupational safety
  • A federal law or regulation
  • A state or local law or regulation based on a BFOQ

This means you can ask for a yes or no answer to a question like, “This job involves serving liquor and requires that you be at least 21 years old. Do you meet the age requirement?”

Additionally, employers can require an applicant provide additional application materials with their initial application, but only if they notify the applicant that they can redact information that identifies their age, birth date, or dates of schooling.

The Colorado Department of Labor and Employment has provided additional guidance on the law in INFO #9B.

Action Items

  • Review your employment application and remove any questions prohibited by the law.
  • Train those involved in the interview process not to ask questions that are likely to reveal the applicant’s age.

Protections for Race Expanded

The state has expanded the definition of race in its antidiscrimination statute to include hair length. If you have dress or grooming policies that regulate hair length, consider whether they’re absolutely necessary for your organization. If you believe they are, consider consulting with an attorney to ensure they don’t run afoul of this law. This law was passed on June 3, 2024, and took effect immediately.

Action Item

Update your Equal Employment Opportunity (EEO) policy, and any other policies that include protected classes, to include hair length in the definition of race (if you include this level of detail).

Organ Donors Protected

Employers are prohibited from discriminating or taking adverse action against employees who donate an organ. The new law doesn’t specifically require that employers provide organ donation leave, but employees who donate an organ should be allowed to use any leaves that a similarly situated employee would be entitled to, such as a personal leave of absence. This law was passed on June 3, 2024, and took effect immediately.

Action Item

Update your Equal Employment Opportunity (EEO) policy, and any other policies that include protected classes, to include organ donors.

Compliance Calendar


7/31 – Form 5500 Filing Deadline (calendar year plans)

7/31 – PCORI Fees Due


8/1 – VETS-4212 Filing Open (federal contractors)


9/30 – Summary Annual Report (SAR) Deadline for Calendar Year Plans


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.

Written By:

Kelly Murphy

Kelly Murphy

Senior HR Business Partner

Kelly brings a wealth of knowledge with nearly 30 years of human resource experience. She provides expertise in various human resource categories, including employee relations, performance management, HR Form creation/review (employee handbooks, job descriptions, etc.), employee/management training, workplace investigations, etc. Her human resource certifications include PHR (Professional Human Resources) and SHRM-PC (Society for Human Resource Management Certified Professional). 

Kelly attended Colorado Mesa University and Waldorf University, where she earned a degree in Human Resource Management and Business Administration with Summa Cum Laude honors. She was named Western Colorado Human Resource Association Professional of the Year, 2013, and currently serves on the Board of Directors. She also is a member of the WCHRA Skills Development Committee, the WCCA Education Committee, and the Members/Events Committee. She serves as an Ambassador for both the Fruita and Palisade Chamber of Commerce.