The Colorado Department of Labor and Employment’s (CDLE) Division of Labor Standards and Statistics has adopted COMPS Order #39, which takes effect on January 1, 2024. This latest update introduces significant changes to wage and hour laws in Colorado, including minimum wage increases, revisions to tip pooling regulations, and updates to time worked rules for employees.
Under Colorado wage law, employers must comply with COMPS Order requirements, including posting a Colorado minimum wage 2024 poster to ensure workers are informed of their rights.
Minimum Wage Increases in Colorado for 2024
As of January 1, 2024, the minimum wage in Colorado is:
- $14.42 per hour for non-tipped employees
- $11.40 per hour for tipped employees
In Denver, the minimum wage is higher:
- $18.29 per hour for non-tipped employees
- $15.27 per hour for tipped workers
Employers operating in multiple jurisdictions must ensure compliance with both state and local minimum wage laws to avoid wage violations.
Changes to the “Time Worked” Rule Under COMPS #39
The CDLE has revised Colorado’s “time worked” rule, refining the one-minute standard for compensable tasks. Employers must pay employees for all time worked, except for tasks completed in less than one minute, when considered under the federal de minimis test:
- How difficult it is to track or record the time worked
- The total amount of time the employee spends on small tasks
- Whether the activity was regularly performed
Previously, pre-shift and post-shift work-related tasks exceeding one minute were compensable. The updated rule maintains that seconds of work do not require compensation, but employers must still account for minutes worked.
Tip Pooling and Tipped Employee Guidelines Under COMPS #39
COMPS #39 provides updated regulations regarding Colorado tip pooling rules. The prior order (COMPS #38) allowed employers to require tip pooling among employees who customarily and regularly received tips but lacked clarity on broader inclusion.
Under COMPS #39, employers may require tipped employees to share tips with other workers who perform significant customer-service functions—even if they are not tipped directly. The rule specifies that tip pooling may include:
- Servers
- Bussers
- Counter personnel who serve customers
- Sushi or teppanyaki chefs
- Service bartenders, bartender assistants, and barbacks
- Sommeliers who explain, bring, and serve wine
- Bellhops
Additionally, tipped employees are now defined as those who regularly receive more than $1.64 per hour in tips, replacing the prior $30 per month standard.
Employers should review Colorado wage laws regarding tipped minimum wage requirements to ensure compliance with tip credit regulations.
Clarifications on Overtime Pay and Regular Rate of Pay
COMPS Order #39 also clarifies how overtime pay is calculated for tipped employees. Specifically, a tipped worker’s overtime pay rate is:
- 1.5 times the minimum wage
- Not 1.5 times the sum of minimum wage plus tips
This ensures that Colorado wage and hour laws align with federal requirements while maintaining clear distinctions for tipped wage calculations.
Baird Quinn Can Help Employers Navigate Wage and Hour Law Compliance
The 2024 updates to Colorado’s wage and hour laws require employers to review their payroll practices and ensure compliance with COMPS Order #39.
If you have questions about Colorado minimum wage laws, tip pooling policies, overtime calculations, or personnel file access, the experienced employment law attorneys at Baird Quinn are here to help. Contact us today for expert legal guidance tailored to your business needs.