Hancock Kniech

Mayor Michael Hancock and Councilwoman Robin Kniech (in white jacket, left of Hancock) announced the city's minimum-wage proposal at a news conference Thursday, Sept. 19 at the Denver City & County Building.

Editor's note: This story has been updated.

On New Year’s Day, Denver’s minimum wage could rise to $12.85 per hour, before jumping to $15.87 in two years.

After six weeks of community meetings, Denver Mayor Michael Hancock and Councilwoman Robin Kniech announced the full proposal to increase the city’s minimum wage over three years, then index it to inflation every Jan. 1.

Kniech said in a statement that she heard support for the raise.

“We also heard that a smaller first step and spreading the proposal out over an additional year would help our small, locally owned businesses better prepare and adapt to higher wages,” she said.

Four other council members — Kevin Flynn, Chris Hinds, Debbie Ortega and Jamie Torres — are cosponsors of the proposal.

Under state legislation passed this year, local governments can enact minimum wage levels higher than the state’s, which will increase to $12 on Jan. 1. Colorado voters passed Amendment 70 in 2016, which raised the hourly wage by nearly $4 in a series of steps. Previously, the constitution indexed the wage to inflation.

The Colorado Restaurant Association has said it will sue the city for improperly interpreting the state’s law.

"We believe this revised proposal is a step in the right direction, and we appreciate the city’s willingness to slow down this increase. However, we don’t believe any municipality can legally raise the minimum wage above the state minimum wage until Jan. 1, 2021," said CEO Sonia Riggs. She added that the increase will exacerbate disparities between the wait staff and other restaurant employees.

A spokesperson for the Denver Metro Chamber of Commerce said that the organization takes no formal position on the plan.

The Denver council’s Finance and Governance Committee will first hear the proposal on Nov. 5, then again on Nov. 12. Both meetings will allow for public comment. The full council will hear the bill on first reading on Nov. 18, with final action slated for Nov. 25. There will be a one-hour public hearing at the latter meeting.

A tip credit for food and restaurant workers would remain at $3.02, the same level as the state’s. According to Kniech and Hancock, over 90,000 Denver workers would see a pay increase.

The legislation also gives the Denver auditor the power, beginning next year, to investigate wage violations in the absence of a complaint. The auditor may use data from the city or credible information from state or federal agencies to investigate potential wage theft.

Auditor Timothy O’Brien’s office said that he did not have an active role in writing the bill.

"The Auditor’s office currently enforces prevailing wage and the new city-specific contractor minimum wage that was enacted back in July," said Tayler Overschmidt, the auditor's director of communications. "Should the new minimum wage ordinance pass, the writers of the minimum wage ordinance have decided to put the new enforcement duties in our office as well."

A spokesperson for Hancock said that investigations of third party complaints and in cases of no complaint are new features of the bill that arose following community feedback.

There is also new language to empower the auditor to enforce findings and collect penalties.

Kniech said that Denver's enforcement proposal is "perhaps a little stricter" in requiring credible information before the auditor gets involved, but that investigations absent a complaint are lawful in New York state, multiple California cities, and Seattle. She added that third-party complaints are allowed in seven states.

"It is really important that we create a space where there is this very limited and controlled power to say, where we have information indicating a violation, we can investigate without the name of the worker being necessarily involved," she said.

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