Colorado Minimum Wage: Current Rate & Scheduled Increases

The federal Fair Labor Standards Act (FLSA), codified at 29 U.S.C. § 206, establishes a federal minimum wage of $7.25 per hour, which has remained unchanged since 2009. This rate applies to all employers engaged in interstate commerce with at least two employees, which covers the vast majority of private employers in the United States. The FLSA covers employees in most industries and occupations, though certain exemptions exist for specific categories such as executive, administrative, and professional employees, outside salespeople, and certain agricultural and transportation workers.

Federal law does not preempt higher state minimum wages; instead, the higher of the two rates applies. When an employee is subject to both federal and state minimum wage laws, the employer must comply with whichever rate is higher. The U.S. Department of Labor (DOL) enforces the FLSA through the Wage and Hour Division (WHD). Employees may file wage claims with the DOL, pursue private civil actions under the FLSA, or file complaints with state labor agencies. Federal remedies include back wages, liquidated damages (an additional amount equal to unpaid wages), and attorney fees if the employee prevails.

Colorado Revised Statutes section 8-6-102 establishes Colorado's state minimum wage and creates an automatic annual adjustment mechanism. As of January 1, 2024, the Colorado minimum wage is $15.00 per hour. Effective January 1, 2025, Colorado's minimum wage increases to $15.69 per hour due to the annual cost-of-living adjustment based on the Consumer Price Index (CPI-U). This automatic adjustment formula, adopted in 2016, ensures that Colorado's minimum wage rises with inflation unless the legislature acts to change the law.

Colorado's minimum wage is significantly higher than the federal minimum wage of $7.25 per hour. Because Colorado's rate is more protective of workers, Colorado's minimum wage applies in the state, and employers cannot pay less, regardless of federal law. Colorado Revised Statutes section 8-6-103 specifies coverage and exemptions. The law covers all employees in Colorado, including part-time, seasonal, temporary, and tipped workers. Unlike federal law, Colorado does not exempt tipped employees from the full minimum wage; employers must pay the entire minimum wage even if the employee receives tips.

Statewide coverage is broader than federal coverage in several respects. Colorado applies to smaller employers than the FLSA does—Colorado covers employers with any number of employees, whereas federal law requires an interstate commerce connection and typically involves larger employers. Colorado also provides stronger protections for tipped workers and does not recognize the same exemptions for certain executives or professionals that federal law does. However, Colorado law does exempt certain categories consistent with federal exemptions, such as family members working on family farms in certain contexts.

Remedies under Colorado law include unpaid minimum wage, penalties, and in many cases attorney fees and court costs if an employee prevails. The Colorado Department of Labor and Employment (CDLE) Division of Labor Standards enforces minimum wage law. An employee may file a wage claim with the CDLE, pursue a private civil lawsuit, or file a complaint with the state labor commissioner. Additionally, Colorado wage violations may qualify for class action litigation if multiple employees are affected.

Colorado minimum wage law contains limited exemptions compared to federal law. The primary exemptions are narrow and rarely applied. Family members employed by family businesses may be exempt in certain circumstances, though the exemption is construed strictly. Agricultural employees working for small farms may have different overtime rules but are not exempt from minimum wage. Certain unpaid interns or apprentices in bona fide training programs may not qualify as employees, though this is determined case-by-case and does not broadly exempt a category of workers.

Colorado does not recognize a separate tipped minimum wage, which is a key difference from federal law. Federal law permits a lower tipped minimum wage of $2.13 per hour if tips bring the employee to the full minimum wage. Colorado requires employers to pay the full minimum wage ($15.00 per hour in 2024) even if the employee receives tips. Tips are a supplement to, not a substitute for, the minimum wage. If an employee's wages plus tips fall below the minimum wage, the employer must make up the difference.

Executive, administrative, and professional employee exemptions exist under Colorado law but are defined by the nature of the employee's job duties, not by job title or salary alone. Colorado generally aligns with federal FLSA exemption tests, requiring that the employee's primary duty involves management, independent judgment, or specialized professional knowledge. However, employers cannot simply classify an employee as exempt based on title; they must demonstrate that the employee actually performs duties meeting the exemption criteria. Outside salespeople are also exempt, provided their work is outside the normal workplace and they are compensated primarily by commission.

Colorado law does not permit 'tip pooling' arrangements that would reduce the minimum wage owed to employees. Any agreement or requirement that employees contribute tips to a pool or share tips with the employer to offset minimum wage obligations is unenforceable. Employees are always entitled to receive the full minimum wage plus retain their tips. Additionally, employers cannot deduct credit card processing fees, uniform costs, or other business expenses from an employee's wages if doing so would reduce the employee's pay below minimum wage.

Step 1 — Document the violation immediately. Keep records of all hours worked, including start times, end times, and breaks taken. Save pay stubs, tax forms (W-2s or 1099s if you are classified as independent contractor), offer letters, employment contracts, and any communications with your employer regarding compensation. Take screenshots or photos of timekeeping systems, handwritten schedules, or emails discussing your wage rate. Note the exact dates and amounts when you were paid less than the current minimum wage, including whether tips or other compensation were offered as substitutes. Create a personal log with dates, hours worked, and the wage you were actually paid.

Step 2 — Follow the internal complaint process if one exists. First, request a written statement of your compensation rate and compare it to the Colorado minimum wage effective on the date of employment. If your rate is below minimum wage, notify your manager or human resources department in writing (email is best) describing the discrepancy and requesting immediate correction. Keep a copy of this communication. Many violations are resolved at this stage without further action. However, if the employer does not respond within a reasonable time (typically 10-14 days) or refuses to correct the violation, proceed to file a formal complaint with the Colorado Department of Labor and Employment.

Step 3 — File a wage claim with the Colorado Department of Labor and Employment (CDLE). Visit the CDLE website at https://cdle.colorado.gov and navigate to the Division of Labor Standards and Statistics section. You may file a wage claim form online or by mail. The claim must be filed within six years from the date wages were earned (the statute of limitations under Colorado Revised Statutes section 8-4-103). Include your name, contact information, employer name and address, the dates of employment, the wage rate you were paid, the Colorado minimum wage rate that should have applied, and the total unpaid minimum wage owed. Attach copies of pay stubs, tax forms, and any documentation of hours worked. There is no filing fee for employees. The CDLE will assign your claim an investigation number and notify the employer.

Step 4 — Expect the investigation process to take 30-90 days, though complex cases may take longer. The CDLE investigator will review your claim and request records from the employer, including timesheets, payroll records, tax filings, and business records. The investigator may contact you for additional information or an interview. The employer will have an opportunity to respond to your allegations. If the investigation concludes that minimum wage was violated, the CDLE will issue a determination letter specifying the unpaid minimum wage, any applicable penalties (up to 10% of the unpaid wages under Colorado law), and interest. The employer has a right to appeal the determination. If the employer appeals, the case may proceed to a hearing before a state labor judge.

Step 5 — Consult an employment attorney before accepting any settlement or if the employer appeals. A wage and hour attorney specializing in minimum wage claims can evaluate the strength of your case, negotiate with the employer's counsel, and represent you in hearings or litigation. Many employment attorneys work on a contingency basis for wage claims, meaning they receive payment only if you win. Contact the Colorado Trial Lawyers Association or your state bar association for referrals. Attorneys can also pursue private civil actions under Colorado law for back wages, penalties, and attorney fees, which may result in faster resolution and potentially larger recovery than the CDLE administrative process. If multiple employees were underpaid, an attorney can pursue a class action lawsuit.