Colorado Wage Law: Local Wage Ordinances and What It Could Mean

Denver officials are considering a minimum wage increase for the first time in 20 years—not because there’s been no appetite for it but because state law prevented it until now.

A new Colorado law effective in August lets cities and counties set minimum wage requirements higher than the state minimum, which is $11.10 per hour. The Denver mayor’s plan, if approved, would gradually raise the city’s wage floor to more than $15.

Colorado was one of the earliest of 26 states adopting laws to preempt local minimum wage ordinances. Colorado’s preemption had been on the books since 1999, whereas most of those other states adopted preemption laws in the 2010s.

The change in Colorado is a rare one amid the trend of ever-widening state preemptions. States block a variety of local employment mandates that go beyond minimum wage—including paid leave, prevailing wage, and gig economy regulations. And new proposals surface across the country each year, including some that would expand preemptions to cover employee scheduling and LGBT-inclusive nondiscrimination ordinances.

“Colorado is one of the success stories from the last cycle,” said Laura Huizar, senior staff attorney with the National Employment Law Project, which advocates for pro-worker policies such as higher minimum wages. “It’s an uphill fight, but it is encouraging for advocates to see” that preemption laws can be reversed.

That’s not to say there isn’t momentum on the other side of the issue. In the same year that Colorado gave local governments authority to set wage floors, North Dakota took away that power. The new Colorado law still partially restricts local authority, limiting annual increases to 15% or $1.75 per hour, whichever is greater.

While Huizar and her allies advocate for minimum wages that ensure workers can support themselves and their families, pro-business and free-market advocacy groups such as the American Legislative Exchange Council tend to argue higher minimum wages—and local minimum wages, in particular—are bad for economic growth and can lead to fewer jobs.

“When the locality engages in raising the minimum wage, you create a patchwork” of regulation that’s difficult for businesses that operate across the state, said Jon Russell, national director of the American City County Exchange, an affiliate of ALEC.

*Thanks to Bloomberg Law for content in this piece