A Democrat measure removing a hurdle to frivolous-employment lawsuits passed in the state House today, after an amendment was attached that further shafts small-business owners.
Senate Bill 117, by Sen. Bob Bacon, D-Fort Collins, and Rep. Terrance Carroll, D-Denver, allows an empoyee to sue for wrongful termination without fear of being forced to pay the defendant's legal fees if the suit is found to be frivolous. However, that relaxation of lawsuit limits is not extended to defendants.
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“This is a bad for business bill,” Sen. Greg Brophy, R-Wray, said today. “It can easily derail the life of someone living the American dream of owning a small business.”
Last month, Senate Republicans helped to limit the bill to only apply to businesses with 50 employees or more. But a House amendment gutted that language and lowered the number to 15 workers and higher, thus taking a stab at small business owners.
SB 117 throws out the current “loser-pay system,” which makes the losing party in a lawsuit responsible for paying the legal fees of the other side.
Bacon claimed his bill attempts to create a situation for those with low income to have access to the legal system. However, critics charge the proposal also causes additional lawsuits to be filed, thus creating more work and a boon for the pockets of trial attorneys.
The proposal was approved today by House members on a mostly party-line vote of 36-29 and is en route to Gov. Bill Ritter for consideration.
Also concerned with SB 117 was former Senate Majority and Minority Leader Mark Hillman, R-Burlington, who mentioned that Colorado has historically never taken sides in disputes between labor and business.
“Unfortunately, this bill does just that by wrongly assuming that an employee will never take advantage of the system,” Hillman said. “More often than not, a problem is not driven by the employee, but by the employee's attorney.”