Colorado Lifts Ban on Local Minimum Wage Ordinances – With Restrictions
Repealing a 20-year old prohibition on local enactment of minimum wage ordinances, on May 28, 2019, Governor Jared Polis signed House Bill 1210 allowing, with certain restrictions, such local ordinances. Under H.B. 1210, no more than 10 percent of Colorado’s local jurisdictions may enact local minimum wage rates and any such rates cannot increase by more than 15 percent annually. Under the law, several adjoining communities may join to enact regional minimum wage rates.
In addition, any jurisdiction that enacts a local minimum wage rate is required to provide a tip credit for employees of any business “that prepares and offers for sale food or beverages for consumption either on or off the premises,” equal to the tip credit provided in the state’s constitution. Currently, the minimum wage in Colorado is $11.10 per hour (scheduled to increase to $12.00 per hour on January 1, 2020) and the statewide minimum wage for tipped employees is $8.08.
The new law allows local jurisdictions to enact minimum wage ordinances beginning in 2020, with an effective date on or after January 1, 2021. To enforce its local minimum wage, the city, county or other governmental entity may adopt provisions creating a private right of action that includes fines, penalties, actual (regular and overtime) damages, liquidated damages, interest, costs, attorney’s fees, and any other “appropriate or equitable relief.”
With the repeal of its local minimum wage preemption law, Colorado bucks the recent trend of states that have enacted such prohibitions. Currently, about one-half of the states have such local preemption laws.