A proposal making its way through the Denver City Council would create a new wage theft crime to fill gaps in the city’s current laws. The ordinance was approved by the finance committee Tuesday, moving it to the full council for consideration.

Wage theft is when an employee is denied the wages or benefits they are rightfully owed. Examples of wage theft include employers failing to pay overtime, forcing employees to work off the clock, violating minimum wage laws or not paying employees at all.

Minimum wage workers who are victims of wage theft lose an average of $64 per week, according to the Economic Policy Institute. In Colorado alone, wage theft results in the loss of up to $750 million from workers per year.

“The current law in Denver makes those cases a little bit harder to prosecute than the state level wage theft cases,” City Attorney Anshul Bagga said. “(City code) requires us to prove that the employer or person committing wage theft had the intent to permanently deprive the victim of the wages.”

Bagga said it is often difficult to prove that intent in court because one of the most common tactics used to commit wage theft is promising payment in the future.

If approved, the ordinance would address this loophole by adding a new crime to the Denver Revised Municipal Code, declaring it unlawful for an employer or an agent of an employer to “knowingly refuse to pay any wages or compensation owed to and worker or falsely deny the amount of a wage owed.”

The ordinance would only apply to employees, not independent contractors; however, it includes a provision that allows a jury to determine whether a worker has been incorrectly classified as an independent contractor – a common wage theft tactic used by employers to avoid providing employee benefits.

The ordinance also includes a provision that declares retaliation in relation to wage theft reports unlawful and requires the city attorney’s office to provide an annual report to the city council of the number of cases prosecuted under the ordinance.

“This really is to address what we see as an inequity,” City Attorney Kristin Bronson said. “It’s harder for lower-wage earners to seek justice, versus higher-wage earners who might be able to have their cases prosecuted under the state statute.”

Denver law still requires that wage theft cases be limited to losses of less than $2,000 – a cap not included in the state law – but Bagga said the attorney’s office can file multiple charges in wage theft cases where the total loss is over $2,000, but each individual paycheck is under $2,000.

General penalty would apply to the new crime, meaning employers found guilty of wage theft could receive a fine of up to $999 and/or jail time of up to 300 days per offense. However, Bagga said the ordinance is mainly seeking resolution and payment for the workers.

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The city attorney’s office does not anticipate needing any additional funding if the ordinance is approved, Bronson said.

Four members of the public called in during Tuesday’s meeting to express their support for the proposed ordinance; however, all four callers emphasized that this change would only be one small step in the right direction.

“This bill is a very modest step forward and it doesn’t close the more serious gaps to enforcement,” said David Seligman, executive director of the nonprofit law firm Towards Justice.

“Those gaps principally come from the use of subcontractors, staffing agencies, labor brokers or others as an intermediary between the employer and worker, and misclassification. … The city can take bolder and broader steps to address these issues.”

The full Denver City Council will vote on the ordinance twice during two of its regular Monday meetings in the coming weeks.