Colorado Minimum Wage
In November, 2016, Colorado passed Amendment 70 raising the Colorado minimum wage to $9.30 in 2017. Tipped employees must be paid a minimum wage of $6.28. As the Colorado state minimum wage rate is higher than the federal minimum wage rate of $7.25, employees must be paid the higher state rate.
Colorado minimum wage will increase to $10.20 in 2018, $11.10 in 2019, and $12.00 in 2020. Tipped employees’ minimum wage will increase to $7.18 in 2018, $8.08 in 2019, and $8.98 in 2020. Cost of living adjustments will be made after 2020.
Prior minimum wage rates in Colorado were $8.31 per hour for 2016, $8.23 per hour for 2015, and $8.00 per hour for 2014.
An employer of a tipped employee may deduct a tip credit from the minimum wage of no more than $3.02 per hour. An employee’s tips plus the cash wage must equal at least the current state minimum wage. This means that if an employee only averages $2 per hour in tips, the employer must pay a cash wage of $6.31 per hour (using 2016 minimum wage). An employer may not claim tip credits toward the minimum wage if the employer requires its employees to share tips with employees who do not regularly receive tips (cooks, managers, etc.) or if the employer deducts credit card processing fees from the employees’ tips.
Minimum Wage Credits and Exceptions
1. Up to $25 per week for lodging furnished by the employer may count towards the Colorado Minimum Wage.
2. Reasonable cost of meals provided to the employee may count towards the Colorado Minimum Wage.
3. Unemancipated minors under 18 may be paid $6.19 per hour.
4. Employees with physical disability certified by the Director may be paid $6.19 per hour.
5. Deductions from wages must be in accordance with the Colorado Wage Act.
Colorado Tipped Minimum Wage
As of January 1, 2009, the Colorado Tipped Minimum Wage is $4.26 per hour ($7.28-$3.02). No more than $3.02 per hour in tip income may be used to offset the minimum wage of tipped employees.
An employee engaged in an occupation where he or she customarily and regularly receives more than $30 per month in tips is defined as a tipped employee.
Employers must pay a wage of at least $4.26 per hour. If tips combined with wages do not equal minimum wage, the employer must make up the difference in cash wages.
Employer-required sharing of tips with employees who are not customarily tipped nullifies tip credits towards minimum wage.
Deduction of credit card processing fees from tipped employees nullifies tip credits
towards minimum wage.
Meal Periods and Rest Periods
Meal Periods:
Employees are entitled to an uninterrupted and dutyfree 30-minute unpaid meal period when their work shift exceeds 5 consecutive hours. The employee must be completely relieved of all duties for the meal period. If the above conditions are not met, then the employee must be allowed to consume a meal on-duty, and be
compensated for the entire on-duty meal period.
Rest Periods:
Employees are entitled to a compensated 10-minute rest period for each 4 hours of work or major fractions thereof. Wages may not be deducted for the rest period. It is not required that the employee be permitted to leave the premises for the rest period.
Colorado Overtime Law
In general, non-exempt employees covered by the Wage Order must be paid time and one-half their regular rate of pay for any work in excess of:
1. 40 hours per workweek.
2. 12 hours per workday.
3. 12 consecutive hours without regard to the start and end time of the workday.
To learn more about Colorado Wage and Hour Law and Colorado Overtime Law visit the Colorado Department of Labor and Employment at http://www.coworkforce.com/
