House kills legislation on discrimination suits
Small businesses won’t have to worry about paying certain types of damages in discrimination lawsuits now that a bill that would have allowed that has died in the Legislature.
After much-heated debate in the Colorado House, lawmakers struck down a measure Thursday that would have allowed up to $300,000 in compensatory and punitive damages in discrimination cases filed in state court. The state now does not allow such damages, forcing cases to be filed in federal court.
Opponents of the measure said it goes too far, particularly at a time when businesses can least afford to pay higher liability insurance, which they said the bill would force.
Rep. Claire Levy, D-Boulder, who introduced House Bill 1269, said most states already allow such damages, so opponents’ arguments that the measure would make Colorado uncompetitive made no sense.
“Every driver in Colorado is required by law to carry auto insurance with a minimum $25,000 coverage, and the risk of a car accident far exceeds the risk of an employment-related lawsuit,” Levy said.
“So, if you’re worried about the increased cost to small businesses from a $25,000 damage recovery, you need not worry. That is not a credible argument.”
While the bill did cap damages to that amount, it applied only to businesses with 14 or fewer workers.
The cap would have doubled for companies that have between 15 and 100 employees, and the amount continues to go up depending on the number of employees, finally capping it at $300,000 for companies with 500 workers or more.
“The business community should not be taking a position that protects bad actors, and that’s what they are doing,” Levy said.
“Why would Colorado businesses want to protect other businesses that commit age discrimination, sexual harassment and other civil rights violations?”
Opponents, however, said it’s the other way around. Why, they asked, should all businesses pay extra for the bad acts of a few workers employed by a few other companies?
Opponents tried to amend the bill to make it apply to government employers as well, but that effort died.
Moments later, they tried to change it to require attorneys fees be paid to the winner of any lawsuit as a way to help prevent frivolous ones from being filed. That, too, failed.
Finally, opponents made the argument that the poor economy made it a bad time to impose an additional burden on businesses.
“There are no businesses supporting this bill. Why do you think that is?” asked Rep. Amy Stephens, R-Colorado Springs.
“Because these are tough economic times. We have businesses on the brink, particularly businesses with 15 or less employees, wondering day-to-day with how they’re going to make it. Now, one more stress, one more pressure, one more potential lawsuit, one more potential insurance payment. For what? So they can be sued?”