RAISES COMING FOR LOW-WAGE WORKERS IN COLO.

Bumps in minimum wage coming to Colorado’s low-pay workers

Colorado’s minimum wage will take its biggest leap in a decade on Sunday, bringing with it significant changes for both low-wage workers and their employers.

Effective Jan. 1, the state’s minimum wage will bump up from $8.31 to $9.30 an hour, following passage in November of Amendment 70, which lifts the minimum wage in annual steps to $12 an hour by 2020.

The initial increase will run 11.9 percent, with the overall increase through 2020 at 44.4 percent. The tipped wage, important at restaurants, will rise even more, up 18.9 percent the first year from $5.29 to $6.28 an hour and reaching $8.98 by 2020, a 69.75 percent total increase.

Nineteen states will ring in the year with an increase in the minimum wage. Massachusetts and Washington state will have the highest new minimum wages in the country, at $11 per hour.

For workers struggling at the bottom of the pay scale, those kind of raises can prove life altering. But they also require employers to carve out space in their operating budgets to cover the higher wages. Some may be unable.

“I am very excited about this opportunity. It will help me make rent and make the bills,” said Jonathan Kenworthy, who moved from Indianapolis to Grand Junction with his wife three years ago.

Kenworthy makes the minimum wage as a driver for a local pizza chain and just over $9 an hour as a cook. He knows his driving wages will go up, but he doesn’t know if his cooking wages will rise to $9.30 an hour or match the overall percentage increase.

Whatever the bump in pay, it will help financially, said Kenworthy, who makes a small stipend singing in local musical productions and hosts karaoke events with his wife to make ends meet.

Despite the stereotype that minimum-wage workers are teenagers earning pocket money, Kenworthy, 32, said many college-educated millennials like himself are struggling to get by on wages at or near the minimum.

“We estimated that the increase would effect 480,000 workers across the state directly and indirectly,” said Michelle Webster, manager of research and policy analysis at the Colorado Center on Law and Policy.

That’s because as the minimum wage rises, it puts upward pressure on the wages just above it. And the higher wages go, the more incentive adults now sitting on the sidelines will have to return to the labor force, Webster said.

Back in 2006, voters passed an initiative that lifted the state minimum wage from $5.15 an hour to $6.85, a whopping 33 percent increase. The sizable leap followed nearly a decade devoid of increases.

Opponents of Amendment 70 argued that the minimum wage since 2007 has adjusted for inflation, unlike in previous years, and pointed out that rural economies and small businesses on the edge of profitability could get hurt the most.

“Two restaurants that I spoke with are laying off some employees. Many are raising prices. Some are discussing changing the way that they work so that their cooks interact more with customers – thus making them eligible to participate in a legal tip pool,” said Sonia Riggs, president and CEO of the Colorado Restaurant Association.

Servers and bartenders, often the highestpaid workers when tips are factored into pay, are receiving the highest percentage pay raises. Managers are looking at ways to bring cooks and dishwashers into the tip pool, to help recruit and retain them, she said.

Liz Funk, labor standards administrator with the state’s Department of Labor and Employment, said employers are aware of the new wage standard. Most of their calls, she said, concern requests for updated wage posters that employers must display in the workplace.

“There is broad awareness because the amendment passed this year. It received a lot of attention,” she said.