DENVER — Coloradans are divided over the latest proposal to save struggling restaurants.
Lawmakers and community members debated House Bill 25-1208 during a House Finance Committee hearing at the Colorado State Capitol on Monday night. The legislation aims to change the state’s rules around minimum wage for tipped workers in order to give restaurants financial relief. Restaurants continue to close across the Denver metro and the state, though the severity of the crisis was a topic of debate Monday.
Tipped workers can make a base wage less than minimum wage because tips are meant to make up for that difference, if not exceed it. If tips are low, those workers would still legally need to be compensated enough to reach the overall minimum wage of their jurisdiction.
According to HB25-1208 sponsor Rep. Alex Valdez, D-Denver, when state lawmakers allowed cities and counties to set higher local minimum wages in 2019, they did not address the minimum wage for tipped workers. Instead, that number is determined by a “tip offset” that is set at $3.02 under the Colorado Constitution.
Colorado’s minimum wage is $14.81 an hour. Its tipped minimum wage is that number minus the tip offset of $3.02, which comes to $11.79 an hour. Denver’s minimum wage is $18.81 an hour, meaning the tipped minimum wage is $15.79.
Valdez called the preset tip offset a “mistake” that is leading to inflated payrolls, which contribute to restaurant closures.
As introduced, HB 25-1208 would have required the $11.79 tipped minimum wage statewide, raising the tip offset in cities like Denver, Boulder and Edgewater, which have raised their overall minimum wages. An amendment introduced Monday night changed that proposal to setting a tipped minimum wage at roughly 65% of the minimum wage in a municipality. Denver’s current tipped minimum, for example, is about 84% of the city’s minimum wage.
Supporters say the bill would provide more financial flexibility that could save more restaurants from shutting down and allow more equitable pay for "back of house" workers like cooks and dishwashers, who typically make less than servers, hosts and bartenders. Critics, however, say it would cost thousands of tipped workers thousands of dollars when it’s already tough to make ends meet. Additionally, they argue there are other ways to address struggling restaurants, such as working to subsidize rising rent or food costs.
Denver7 360 | In-Depth News
Why are so many Denver restaurants going belly up or moving out of the city?
Several restauranteurs have testified in support of the bill, talking about their struggles in recent years dealing with increased wages on top of other climbing expenses. Meanwhile, several workers and union members have rebuked the bill as going after the most vulnerable group involved.
The heated debate seems to have reached a new level. Some restaurant owners who testified Monday told Denver7 they were hit with negative online reviews after their initial testimony in support of the bill.
In a statement Monday, House Democrats said in part, “We were alarmed and disturbed by the distribution of a deeply disrespectful flyer targeting a member at the Capitol and by attacks on businesses who testified in support of legislation in recent days. We want to make it clear that these actions are unacceptable.”
Denver Mayor Mike Johnston’s office has backed the bill, while several city council members have spoken out against it.
Denver7 is committed to making a difference in our community by standing up for what's right, listening, lending a helping hand and following through on promises. See that work in action, in the videos above.
