Colorado's minimum wage rises to $15.71 per hour in 2027, up from $15.16. The minimum for tipped workers rises to $12.69 per hour, up from $12.14. Some local governments set higher rates.
In This Guide
What changes in 2027
The Colorado Department of Labor and Employment (CDLE) announced on August 13, 2026 that the state minimum wage will increase to $15.71 an hour in 2027. The current rate is $15.16, so this is an increase of $0.55 an hour, or 3.6%. Read the CDLE press release for the full text.
The release says the new rates apply in 2027 but does not name a start date. Colorado's yearly adjustment takes effect on January 1 under the state constitution. Confirm the date on CDLE's 2027 poster when it is published.
The Colorado Constitution requires the rate to be adjusted for inflation every year. The state uses the Consumer Price Index for All Urban Consumers (CPI-U) from the federal Bureau of Labor Statistics. CDLE notes that this measure covers a sample representing more than 90% of the U.S. population.
| Rate | 2026 | 2027 |
|---|---|---|
| State minimum wage | $15.16 | $15.71 |
| Tipped workers | $12.14 | $12.69 |
For perspective, CDLE says $15.71 is 41.5% higher than the 2019 minimum wage of $11.10.
Tipped workers
The 2027 minimum for tipped workers is $12.69 an hour. The lower cash wage only works when tips bring the employee up to the full $15.71 for the hours worked. If tips fall short, the employer pays the difference.
Update the tipped pay code at the same time as the regular rate. They are often set up separately in payroll systems, and one is easy to miss.
Local minimum wages
Some Colorado localities set their own minimum wage by local ordinance, and those rates can be higher than the state rate. CDLE publishes state and local minimum wages with tip credits on its Division of Labor Standards and Statistics site, and says it will update that page as localities announce 2027 rates. Check it for every location where your employees work.
Who gets the raise
The minimum wage is a floor. An employee already paid more than $15.71 an hour does not have to get a raise. Hourly staff under that rate do, unless a specific exception covers them.
Pay plans that are not hourly need a look too. A non-exempt employee paid by salary, commission or piece rate must still receive at least the minimum wage for the hours worked. Check those employees against the new rate before January.
Pay periods that cross January 1
The new rate applies to hours worked on or after January 1, 2027. It does not depend on the pay date. If a pay period starts in December and ends in January, split the hours. Pay the December hours at the 2026 rate and the January hours at $15.71.
Paying the whole period at the new rate is also allowed, and it is simpler. Paying the January hours at the old rate is not.
Watch pay just above the minimum. When the floor moves to $15.71, a shift lead or a long-time employee may end up only a few cents ahead of a new hire. Keeping that gap is a business choice, not a legal one. It is easier to plan for in the fall than in January.
What to do before January 1
- Raise covered employees' hourly rates below $15.71 and every tipped cash wage below $12.69. Apply the new rates to hours worked on or after January 1, 2027.
- Check local rates for each work location and pay the higher rate where one applies.
- Check salaried exempt staff. Colorado sets its own salary threshold for exempt employees, but this announcement does not state the 2027 figure. Confirm it with CDLE before your first 2027 payroll.
- Replace your posted wage notice with the 2027 version from CDLE once it is published.
- Budget for the raise, including overtime and employer payroll taxes.
For the rates in effect through December 31, 2026, see our Colorado minimum wage 2026 guide. For withholding and filing rules, see the Colorado payroll compliance guide.
Frequently Asked Questions
What is the Colorado minimum wage in 2027?
Colorado's minimum wage increases to $15.71 per hour in 2027, a 3.6% increase from the 2026 rate of $15.16.
What is the tipped minimum wage in Colorado in 2027?
The 2027 minimum wage for tipped workers in Colorado is $12.69 per hour, up from $12.14. Tips must bring the employee up to at least $15.71 per hour.
Do Colorado cities have higher minimum wages?
Some Colorado localities set their own minimum wage by local ordinance. CDLE publishes state and local minimum wages on its Division of Labor Standards and Statistics site.
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Legal & Tax Disclaimer
This article is for general informational purposes only and does not constitute legal, tax, or professional advice. Employment laws, tax regulations, and compliance requirements change frequently. The information on this page reflects our understanding as of October 2026 and may not reflect recent changes in federal or Colorado state law.
Do not act or refrain from acting based solely on the information in this article. Always consult a qualified attorney, CPA, or HR professional familiar with Colorado law before making payroll or compliance decisions for your business.