Small business owners in the Centennial State know how important it is to stay up to date on minimum wage regulations. You want to make sure you’re in compliance, of course. But staying aware of upcoming changes also lets you better plan for the future of your business.
That’s why we put together this quick guide with information you should know about the minimum wage in Colorado.
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What is the 2019 minimum wage in Colorado?
The minimum wage in Colorado increases to $11.10, $3.85 higher than the federal minimum wage.
If you have tipped employees, no more than $3.02 per hour in tips can be used to offset the minimum wage. So, if an employee’s tips combined with the employer’s cash wage of at least $7.18 per hour do not equal $10.20 an hour, the employer must make up the difference in cash wages.
Are there plans to change the minimum wage?
Colorado’s Amendment 70, effective January 1, 2017, put in place a schedule of annual minimum wage increases. Every January 1, the minimum wage will increase by $0.90 until it reaches $12 per hour in January 2020. After that, it will be adjusted annually for cost of living increases, as measured by the Consumer Price Index used for Colorado.
|January 1, 2017
|January 1, 2018
|January 1, 2019
|January 1, 2020
The same goes for the minimum wage for tipped employees. It’s $7.18 in 2018. It will rise by $0.90 to $8.08 in 2019 and $8.98 in 2020.
How should small business owners prepare for changes to the minimum wage?
Colorado small business owners should be used to the rising minimum wage, as the rate has been gradually increasing nearly every year since 2007.
Still, the minimum wage has increased more in some years than in others. For example, it rose just eight cents between 2015 and 2016, but 99 cents between 2016 and 2017. The Colorado minimum wage is scheduled to increase another 90 cents annually in 2019 and 2020, so business owners should run the numbers to see how the new rates will affect their bottom line, and figure out if they will need to adjust staffing or prices.
Here are some other steps you can take to make sure your business is ready for anything:
- Evaluate your staffing: Take a look at your hourly, weekly, and monthly sales to determine if your current staffing levels are appropriate. Maybe you do need more full-time employees. Or maybe your increases in sales are confined to certain times of year and you should consider hiring seasonal help.
- Hire the best: Hiring the right people is always important, but doubly so when you operate a small business. So take your time and cast a wide net when recruiting new employees. And once you have your team in place, make employee retention a priority by offering them a path to growth and development and by making your business an attractive place to work.
- Upgrade your technology: When you automate complicated, time-consuming aspects of management, like payroll, you can spend more time focusing on issues like staffing and growing your business.
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