Denver Wage Theft Law

A new Denver wage theft law was signed by the mayor in January 2023, providing civil penalties for wage theft and clarifying enforcement of wage theft violations.

Denver’s new wage theft ordinance gives broader authority to the city Auditor’s Office to pursue claims and allows officials to issue harsh penalties for noncompliance.

The ordinance also includes a labor law poster requirement in both English and Spanish. If physical display of the poster isn’t feasible, employers may provide it electronically to workers in a form that is “reasonably conspicuous and accessible.” It also must include information about the Denver minimum wage law. (Note: GovDocs clients will receive the updated poster when it is released, along with other updates for applicable locations.)

UPDATE (April 14, 2023): The labor law poster associated with Denver’s wage theft law has been released. 

Get More Out of Your Labor Law Poster Program

Denver Wage Theft Law

While Denver has had a wage theft ordinance on the books, the updated law allows for broader civil penalties and provides additional resources for employees who bring forth wage theft claims.

Of note, when employers fail to pay wages owed within 14 days of being found in violation, city officials can assess several penalties, including:

• Back wages
• Up to a $25,000 fine for each violation (per worker)
• Money accrued after filing a complaint
• 12 percent interest per year on unpaid wages
• Treble damages
• Job reinstatement

Meanwhile, the updated ordinance also includes an expanded definition of employee. It includes “temporary workers, agents, and any other person or entity performing work on behalf of or for the benefit of an employer.”

Other facets of the Denver wage theft law include:

• A private right of action for workers who were deemed victims of wage theft
• Anti-retaliation provisions
• Recordkeeping requirements
• Fines for lax recordkeeping
• A three-year statute of limitations to file a complaint

According to the city, about half of Colorado residents are victims of wage theft each year, with the average worker losing $64 a week, or $3,300 per year, due to wage theft.

Find the full Denver wage theft statute on the city’s website.

Wage Theft Nationwide

Government agencies in recent years have put an added emphasis on wage theft.

• Wages recovered for health care workers in 2021: $13.8 million

• Wages recovered for construction workers in 2021: More than $36 million

• Wages recovered for retail workers in 2021: More than $13.4 million

• Wages recovered for food service workers in 2021: More than $34.7 million

While federal officials enforce the provisions of the Fair Labor Standards Act, several states and local jurisdictions have passed their own wage theft laws, as seen recently in Denver, which impose additional burdens on employers to remain compliant.

At the same time, jurisdictions with such laws have been moving from education to enforcement, making wage theft a major concern for HR and compliance teams.

Wage theft costs workers an estimated $15 billion a year. And more than $3 billion in wages was recovered between 2017 and 2020.

The most common form of wage theft is misclassification. It’s the simplest way for employers to unwillingly fall prey to wage theft. Employers must ensure location managers are trained in the specifics of the Fair Labor Standards Act and any state and local wage laws.

Auditing wage and hour basics is always a good start:

• Make sure employees aren’t working before or after they clock in
• Track and applying accurate minimum wage rates
• Simply paying agreed upon rates
• Make sure you are compliant with the salary threshold levels for your exempt workers
• Ensure your non-exempt workers are not working during their unpaid breaks
• Ensure overtime is paid out accurately

Wage Theft Whitepaper

Conclusion

Employers with locations in Denver should be aware of the new wage theft law and ensure compliance.

And, with additional avenues for city officials to exercise their oversight and employee resources, employers that operate in the Mile High City should take extra care in how they classify employees and pay wages.

This Employment Law News blog is intended for market awareness only, it is not to be used for legal advice or counsel.