Colorado Minimum Wage Increases and Exempt Employees

The Colorado Wage Order is the state minimum wage and overtime law. There are several types of employees that are not subject to the Wage Order. These “exempt” employees include:

  • executive/supervisor, administrative, and professional employees
  • outside sales employees
  • elected officials and members of their staff
  • companions, casual babysitters, and domestic employees employed by households or family members to perform duties in private residences
  • property managers
  • interstate drivers, driver helpers, loaders or mechanics of motor carriers
  • taxi cab drivers
  • bona fide volunteers
  • students employed by sororities, fraternities, college clubs, or dormitories
  • students employed in a work experience study program
  • employees working in laundries of charitable institutions which pay no wages to workers and inmates, or patient workers who work in institutional laundries

Under the state law, executive/supervisor employees who are paid on a salary basis, supervise the work of at least two full-time employees, have the authority to hire and fire or to effectively recommend such action, and spend a minimum of 50% of their time on supervisory duties are exempt from the Colorado Wage Order. In addition, these employees must earn more than the equivalent of minimum wage for all hours worked in a workweek.

Colorado recently raised its minimum wage rate to $10.20 per hour (as of January 1, 2018). At this rate, if an executive or supervisor works 50 hours per week, their salary must be higher than $510 per week – $10.20 x 50 hours. This rate is higher than the federal minimum salary requirement of $455* per week. Therefore, if an employer is only paying an executive or supervisor the minimum federal salary amount of $455 and the employee works 50 hours per week, the employee may be exempt under federal law but may still have a Colorado state law claim.

* The Department of Labor under the Obama Administration increased this salary amount to $913 per week effective 12/1/2016; however, this increase was blocked by a court ruling. The Trump Administration is now reconsidering these changes and appears to favor a lower minimum salary amount. Please see this page for the latest updates.

This minimum wage requirement will increase the required salary amount as weekly work hours increase. For example, if the executive or supervisor works 60 hours per week, their salary would need to be higher than $612/week ($10.20 x 60 hours); otherwise, they will not be exempt under state law and may have a state law overtime claim even though they may still be exempt under federal law.

The following is the minimum salary amount required based on the minimum wage rates for 2017 and 2018 for the executive / supervisor exemption to apply under Colorado state law:

Weekly Hours    2017   2018
40 hours            $372   $408
50 hours            $465   $510
60 hours            $558   $612

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