2022 Denver Labor Wages Report

2022 Denver Labor Wages Report.

Denver Labor - Wages Report

Unpaid wages recovered by Denver Labor in 2022.

This graph shows Denver’s unpaid wages recovered by the labor division of the Denver Auditor’s Office by year. In 2013, $101,905 were recovered. In 2014, $142,977 were recovered. In 2015, $84,232 were recovered. In 2016, $701,787 were recovered. In 2017, $417,271 were recovered. In 2018, $265,243 were recovered. In 2019, $678,559 were recovered. In 2020, $1,017,363 were recovered. In 2021, Denver Labor recovered $690,298 for workers. In 2022, Denver Labor recovered $1,101,737.73.

What We Do

Picture of the Denver Labor team in 2022.

In 2022, Denver Labor broke records: Our team put more money than ever back into the hands of workers who were not paid according to the law. We passed the $1 million mark for worker restitution in October and kept building on that to close the year with $1.1 million returned. That is money collected from employers and returned to the workers who earned it, not including outstanding or ongoing investigations.

Auditor O’Brien, Denver Labor Executive Director Jeffrey Garcia, and our team of labor analysts work with both businesses and workers to resolve wage compliance issues in ways that work for everyone. We take an education-first approach to wage law compliance and enforcement.

In 2022, members of the team held weekly public trainings in both English and Spanish — and provided other materials online and in person in multiple languages. This allows for an ongoing, inclusive, and accessible dialogue about the city’s processes.

We audit 100% of certified payrolls and investigate 100% of wage complaints.

Our office enforces both minimum wage and prevailing wage laws. In 2022, the minimum wage rate in the City and County of Denver was $15.87 per hour, with few exceptions, and it will increase to $17.29 per hour in 2023.

In 2022, the Denver City Council voted to change the contractor minimum wage so it would increase annually at the same time as the citywide minimum wage. Employers must pay the greatest applicable wage rate for any work performed in the city or on city projects — therefore, the lower contractor minimum wage rate would not apply in Denver.

Denver Labor Wages Timeline in 2022.

Transcript of wage rates timeline in dollars per hour(PDF, 69KB)

Minimum Wage

In November 2019, the Denver City Council created Section 58-16 of the Denver Revised Municipal Code, which sets the local minimum wage for Denver and prescribes the means for setting, enforcing, and complying with the new local minimum wage.

New in 2022, the ordinance allowed our team of analysts to proactively begin investigations of businesses considered to be high risk. We investigated employers in industries and locations such as those along Denver’s boundaries, national brand companies, restaurants, home care services, salons, and valet parking companies.

Dollars recovered in a sigle minimum wage investigation: $187,865 Largest number of employees impacted by a single minimum wage investigation: 404

Common mistakes we identified included businesses claiming the tip credit when they should not, businesses thinking they are outside Denver’s boundary when they are not, and businesses paying a wage based on the employer’s office location instead of where the work was done.

Sources of minimum wage investigations.

Minimum wage cases by industry
Closed Minimum Wage Cases by Industry.

Penalties for employers
Minimum Wage Penalties in 2021 and 2022.

Penalties assessed
Description of minimum wage penalties in 2021 and 2022.

Denver Labor’s goal is to protect Denver’s employers and employees and ensure everyone is paid according to the law.

Our office believes education for both employers and the public is the key to a successful citywide minimum wage ordinance. This year, we continued our live “Wages Wednesday” series on Facebook — in both English and Spanish. We are also in the community to do presentations, raise awareness, and build relationships with community groups.

We offer several useful tools for both employers and employees on our website — including a regional address finder to help determine whether work performed was in the boundaries of the City and County of Denver, a minimum wage and tip calculator, an employer underpayment calculator, a tips tracker for the food and beverage industry, and complaint forms in English and in Spanish.

Minimum Wage Restitution Stories

Here are some examples of how we worked with both employers and employees this year to recover unpaid wages in accordance with the minimum wage ordinance:

Denver Labor Recovers Unpaid Wages for Afghan Refugee
Third parties can submit a wage complaint on behalf of an underpaid worker. In this restitution case, the African Community Center of Denver reached out to Denver Labor because an Afghan refugee the center had helped find employment to perform construction work was being paid below Denver’s citywide minimum wage of $15.87 per hour. When Denver Labor notified the local contractor about the wage investigation, the contractor eagerly worked with our office to resolve the underpayment and returned the unpaid wages in less than one week. The employer also raised the worker’s hourly wage to $16 per hour.

Janitorial Employees Receive More Than $32,000 in Restitution
A janitorial contractor cleaning a college campus in Denver failed to pay employees Denver’s citywide minimum wage for a year and a half. After an employee submitted a complaint to Denver Labor, the contractor increased all employees’ hourly rates to at least meet the minimum wage and 25 janitors received $32,089.27 in restitution.

Valet Parking Company Returns $38,900 to Employees
After identifying valet parking as a high-risk industry for underpayments, Denver Labor conducted a routine compliance audit on a national valet parking company. The company’s payroll records showed it was taking a tip credit for the tips received by its employees — but this is allowed only for businesses in the food and beverage industry to reduce their minimum wage obligation as long as their workers receive that amount in tips. When Denver Labor notified the business that it could not claim a tip credit, the company worked with our team to raise wages and resolve the underpayment. Forty-nine employees received $38,895.97 in restitution.

Thirty-Three Employees Receive $24,900 in Restitution
The Denver Labor team received a minimum wage complaint through our website because a national beauty service retailer was paying its employees less than Denver’s required minimum wage and was also claiming a tip credit. Our minimum wage team educated the employer about the tip credit, which Denver’s citywide minimum wage ordinance allows only for the food and beverage industry. The company corrected the wages for all its employees, and our office recovered $24,875.55 for 33 workers.

Marijuana Dispensary Updates Wages for 13 Employees
Denver Labor received a complaint about a local marijuana dispensary with multiple locations in the metro area. The dispensary was not adjusting wages to comply with Denver’s citywide minimum wage when the work was performed at the Denver location. After educating the employer on how to track hours and update wages for those employees working within the City and County of Denver, our team recovered $398.69 for 13 employees.

A National Retailer on Denver’s Border Returns More Than $25,000 to Employees
A national retailer on the Denver side of the border between Denver and Jefferson counties was paying the state minimum wage rate for two years instead of Denver’s minimum wage. An employee saw a social post from our office and submitted a complaint to initiate an investigation. Upon receiving the notice of investigation and an information request from our office, the employer performed a self-audit and paid a restitution of $25,268.47 for 45 employees. This case illustrates how some national companies with a human resources office outside Colorado may be unaware of local minimum wage laws and incidentally underpay their workers in the City and County of Denver.

Read more successful restitution stories for Denver Labor on our website.

Prevailing Wage

By revamping the city’s prevailing wage ordinance in 2016, Auditor O’Brien changed the way Denver does business on all projects and changed how work is performed on city property. Now, his growing team works to bring all parties together to make Denver a good, efficient place to work. The Auditor’s prevailing wage team works with both contractors and workers on all Denver projects to ensure compliance and payment according to the law.

We have enforced prevailing wage requirements in Denver since the 1950s. Contractors and subcontractors doing work at or in connection with the operation of any public building or doing public work on behalf of the City and County of Denver must pay their workers the prevailing wage.

Prevailing wage is required on contracts of $2,000 or more for construction, improvement, repair, maintenance, demolition, or janitorial work. Through education, outreach, and investigation, our prevailing wage team works with both employers and employees. Our work helps support businesses in compliance with the law and we strive to put city funds into the hands of contractors and workers as quickly and efficiently as possible.

Wage reporting software, easy to-use tutorial videos, and public question-and-answer sessions all help streamline the process. Our analysts work with employers to ensure employees are classified correctly, and we also work with employers to guide them through the reporting process. We can accommodate training and event requests in English and Spanish, both virtually and in person. 

Prevailing Wage Restitution Stories

Here are some examples of how we worked with both employers and employees this year to recover unpaid wages in accordance with the prevailing wage ordinance:

Denver Labor Recovers More Than $207,000 for Waste Services Employees
Employees working on trash removal services and disposal-site contracts received $207,428.94 in restitution. The prevailing wage team found the workers were classified correctly but the contractor failed to meet prevailing wage requirements by claiming fringe credit that had not been approved by our office. Fringes are guaranteed benefits that an employer provides for the employees’ health and welfare, such as health insurance, paid time off, or a 401(k). For it to count toward their prevailing wage requirements, contractors must translate these benefits into an hourly fringe credit, which must be approved by our prevailing wage analysts. Denver Labor worked cooperatively with the contractor to obtain accurate documentation, approve fringes retroactively, and calculate the restitution for 35 employees.

Apprentice Receives $2,654 in Restitution for Prevailing Wage Work
Denver’s prevailing wage ordinance requires all apprentices to be enrolled in an apprenticeship program registered with the U.S. Department of Labor’s Bureau of Apprentice Training. A team member in our prevailing wage division found that a city contractor classified and paid an employee as an apprentice for three months before registering them in an approved apprenticeship program. Until the employee received the required apprentice certificate, the employee should have been classified and paid as a journey worker for all work performed on the prevailing wage project. After identifying the issue, Denver Labor helped recover $2,653.68 in restitution for the employee. The prevailing wage team prioritizes educating employers about the law and workers about their rights. Sometimes mistakes still happen and workers get paid less than what’s required. Every dollar matters to Denver’s workers and every case matters to Denver Labor. Read dozens more restitution stories on our website. 

Every dollar matters to Denver’s workers and every case matters to Denver Labor. Read more successful restitution stories for Denver Labor on our website.

ARE YOU OWED MONEY?
If you were underpaid at work, our office might have a restitution check waiting for you. Check for your name on our website.

Civil Wage Theft

Wage theft is the failure to pay workers the full wages to which they are legally entitled. On Jan. 9, 2023, the Denver City Council passed the Civil Wage Theft Ordinance.

Every worker has the right to be paid the wages they’ve earned and are entitled to. These could include, for example, the minimum wage, overtime, paid sick time, money for all of the time a person spends working, and the wages a person is promised.

  • Civil wage theft happens whenever somebody isn’t paid the wages they’re entitled to, as promised and required by law.
  • Civil wage theft is one of the most common legal violations in the country. Researchers estimate that every year, it affects millions of people and costs tens of billions of dollars.
  • Employers must provide all workers with an Auditor-approved wage notice detailing the Denver's minimum wage, that wage theft is a crime, that workers are entitled to civil recovery of unpaid wages, and that complaints alleging wage theft may be submitted to the Auditor’s Office.

Research conducted during the development of the ordinance shows employers may use any number of tactics to get out of paying employees, including the following:

  • Maintaining insufficient funds in their bank account, so that employees cannot cash their paychecks when they try to do so.
  • Claiming they cannot pay employees because their general contractors have not paid them.
  • Paying daily, then paying weekly, then gradually failing to pay in full or in part.
  • Promising to pay accumulated wages on the next project (called “kiting”).
  • Promising to pay on Fridays but disappearing before payment is due.
  • Intentionally misclassifying workers as independent contractors to get out of payment.

Wage theft occurs when a worker is paid less than the full wages to which they are legally entitled. It includes:

  • Overtime violations - failing to pay nonexempt employees less than time and a half for hours worked in excess of 40-hours per week.
  • Off-the-clock violations - asking employees to work off the clock before or after their shifts.
  • Meal break violations - denying workers the legal meal breaks.
  • Illegal deductions.
  • Employee misclassification violations - misclassifying employees as independent contractors to pay a wage lower than the minimum or to avoid paying overtime.

Often, employers contract with other employers to provide services. For example, a hotel might hire a cleaning company, which provides workers for janitorial services; or a general contractor on a construction site might hire other employers to provide labor for electric work, plumbing, drywall installation, painting, or something else. “Up-the-chain accountability” means that any employer who ultimately benefits from a worker’s labor may be required to  pay their wages. If the cleaning company hired by the hotel can’t or won’t pay workers what they’re owed, then Denver Labor can collect from the hotel. Denver Labor will always try first to collect from somebody’s direct employer.

In 2023, the Denver Labor team is working to build its team and start responding to civil wage theft complaints, in accordance with the ordinance and the newly finalized rules. Our rulemaking process included community groups and stakeholders from both labor and business organizations. We will report on this work in 2024.

 

Business Resources

Our team offers many types of resources to support Denver’s businesses, including tools on our website, work site posters, pamphlets and educational materials, training opportunities, and one-on-one availability with our analysts.

We know underpayments are most commonly the result of honest mistakes, not intentional wrongdoing. As a result, we strive to prioritize education — and when we find businesses owe significant restitution, we work cooperatively to find solutions to help managers pay their employees while keeping their businesses going.

On our website, employers can find tools like a map of Denver where employers can see whether the citywide minimum wage applies to their employees, a restitution calculator spreadsheet, and prevailing wage rates for each job classification. When we conduct minimum wage investigations, we:

  • Receive a complaint or begin a proactive enforcement investigation.
  • Assess the complaint to ensure it meets initial investigation requirements.
  • Contact the employer to request employee, payroll, and compliance documentation.
  • Evaluate the complaint to consider all information provided by any complainant and the employer.
  • Determine underpayment and fines, and inform both parties of any restitution that might be required.
  • Resolve the complaint.

Once the employer provides evidence of a completed restitution payment, the case is closed. If no restitution was required, the case will be closed. When there is not sufficient evidence, the case is referred to another agency for investigation or to an outside firm for collection of restitution.

Under the minimum wage ordinance, employers are required to keep payroll documentation for three years for all past and current workers. The documentation should include the number of hours worked, the hourly wage paid to each worker, any deductions made from worker wages including taxes, and the net amount of wages each worker receives. Our office’s active enforcement approach to launching a minimum wage investigation can include on-site visits to speak with at-risk workers. Criteria that could trigger active enforcement include:

  • Prior violations by a business owner.
  • A pattern of noncompliance within an industry.
  • Credible information from a state or federal agency.
  • Data indicating an employer is likely violating the minimum wage law.

Employers may reduce their minimum wage obligation up to $3.02 per hour if they are in the food and beverage industry and their employees receive that amount in tips. Employers must keep documentation showing employees received at least that amount in tips to claim the full tip credit. Employers of unemancipated minors performing work as part of a certified youth employment program can pay those minors 15% less than the minimum wage.

Employers on prevailing wage projects in the City and County of Denver are required to submit their certified payrolls every two weeks in the LCPtracker system. Our analysts audit 100% of payrolls. Current wage determinations for all classifications are available on our website. We also offer tutorial videos and an LCPtracker setup form on our website to help contractors get started on each project.

We encourage any employer who is unsure about how to stay compliant with the law to let us know. Call or email our team, and our analysts are happy to help.

 
Minimum Wage Results

 $442,865.89 

81

21

17

43 

 

720

 restitution recovered
in 2022 
new investigations cases closed
with restitution
cases closed
with no underpayment
cases
still opened
impacted
employees 

 

Prevailing Wage Results

 $658,861.84 

 $207,428.94 

1,343

$5.98B 

restitution recovered in 2022 largest dollar amount recovered
in a single investigation
employees who
receive restitution
project payroll
value ($)

Auditor’s Letter

Denver Auditor Timothy M. O'Brien.

My office serves as a check and balance for Denver’s government on behalf of the community we serve. Our operational priorities are your priorities.

In this report, we provide a detailed look at Denver Labor’s successes in working with both employees and businesses throughout the city. Read more about our exemplary staff, our office’s work on behalf of everyone who cares about the city, and how we strive for open communication with all members of our diverse community.

First, let me extend my appreciation to Mayor Michael B. Hancock, members of the Denver City Council, the independent Audit Committee, and the city’s financial and operational management for supporting our mission throughout the year.

Denver Labor is analyzing more details and looking deeper into payrolls and invoices than ever before — with the continued goal of protecting Denver’s employers and employees and ensuring thousands of workers across the city receive the money they are owed.

Our team of analysts investigate 100% of wage complaints. In the first two years of citywide minimum wage enforcement, we used a complaint-based system to recover unpaid wages and to track data about industry compliance and community needs. This year, we used proactive enforcement tools to recover a record amount of restitution for workers who were not paid as required by law.

Through outreach, education, and investigation, our team works with both employers and employees to ensure everyone is paid according to the law. Our wage team helps keep businesses working and city funds going out the door to contractors and workers as quickly and efficiently as possible.

Our work is performed on behalf of everyone who cares about the city, including its residents, workers, and decision-makers. Our mission is to deliver independent, transparent, and professional oversight to safeguard the public’s investment in the City and County of Denver.

Our function as an independent agency serves as a tool for good government in the city. Your input matters to us — and to other city leaders. By continuing to support our work and elevate the issues we cover, you help ensure Denver’s leaders take meaningful action.

Follow us on social media, sign up for our monthly email newsletter, or reach out to us directly by emailing Auditor@DenverGov.org to share your thoughts, concerns, or questions. Read this Annual Report in Spanish on our website.

Sincerely,

Auditor's Signature

Denver Auditor Timothy M. O’Brien, CPA
 


 Auditor Tim O'Brien headshot

AUDITOR TIMOTHY O'BRIEN, CPA
Denver Auditor


Denver Auditor´s Office

201 W. Colfax Ave. #705 Denver, CO 80202
Emailauditor@denvergov.org
Call: 720-913-5000
Follow us on Facebook     Connect with us on Twitter
Read our social media policy

Auditors Office Logos for Footer