Effective January 1, 2013, minimum wage earners in Colorado received a raise. The state minimum wage increased $0.14 per hour resulting in new minimum wages of $7.78 per hour for non-exempt employees and $4.76 per hour for tipped employees. It is estimated that over 66,000 employees in Colorado benefited from the increase in wage level.
The raise results from an amendment to the Colorado Constitution which was approved by voters in 2006. The policy is known as “indexing” and is designed to allow minimum wage earners to keep pace with the rising cost of living. In enacting the increase, Colorado joins seven other states including Arizona, Florida, Montana, and Washington that also utilize indexing.
Indexing mandates adjustments to the minimum wage based upon changes in inflation. For purposes of the Colorado minimum wage, changes in inflation are measured by the Consumer Price Index used for Colorado. Information regarding the inflation adjustment process and calculations can be found at the Colorado Department of Labor & Employment website.
Colorado employers many not pay under the revised minimum wage levels unless the employee or occupation is specifically exempt from the minimum wage pursuant to state or federal law. In addition all Colorado employers must display an approved Colorado State minimum wage poster.
If you would like more information, please contact our Business Law Group partner, David A. Closson at [email protected].