Compensating workers fairly is extremely important to ensure the success of your business, while also making certain you are following all applicable laws. When it comes to pertinent wage laws in Colorado, employers must be aware of any changes to ensure they remain in compliance.
Many low-wage workers would like to see the boost to the state’s current minimum wage laws that is proposed by Amendment 70. However, some business owners have expressed concern that increasing pay could negatively affect some of their employees, particularly when it comes to untipped workers. The benefits of the minimum wage increase may not be felt at all by these employees if they are already receiving a wage that is higher than the proposed minimum. They also would not see a pay raise from the higher menu prices intended to accommodate the new wage. Instead, these changes would exclusively benefit servers because their tips are typically figured on a percentage of the bill.
One restaurateur points out that many of these employees already make well over the minimum wage. Prevailing tip credit laws stipulate that workers who earn tips can be paid $3.02 less than the current minimum wage, which is more than covered by the money they receive from customers. Therefore, they would see substantial benefit over their untipped counterparts if the minimum wage is raised to $12 an hour by 2020.
Employment litigation involving wage and hour laws can be a very real concern for many employers. When faced with employee claims, business owners are encouraged to speak with an attorney who can offer more information on their legal options.
Source: Forbes, “Colorado's Minimum Wage Hike May Worsen Inequality Among Co-Workers,” Robb Mandelbaum, Oct. 30, 2016