What is considered a living wage in Colorado?

Living wage has been a growing issue in labor politics and economic discussions in this country, particularly as unions and other worker groups began aggressively championing raising minimum wage over the past few years. Living wages are of concern here in Colorado as rent and home prices soared over the past decade. When living costs in Denver and other Colorado cities exceed local wages it prices workers out of their homes. Rising costs partially drove the push to increase Colorado minimum wage; however, minimum wage often fails to provide a living wage for Colorado workers. Today’s post will explore what is considered a living wage in Colorado and some of the legal concerns that arise in the debate.

What is a living wage?

A living wage is the hourly rate an individual must earn to support his or her family when that person is the sole provider and works full time. Living wage is not the same thing as minimum wage. Minimum wage is a minimum amount an employer may pay to an employee covered by the minimum wage law for work. Living wage considers the costs to that family to meet their minimum needs for self-sufficiency where the family lives. These costs change across regions rather than assume equal costs across the board. Note that a living wage is not a calculation of the wage necessary to live comfortably or move up the economic ladder.

Typically economists calculate living wages in light of the size of the family supported by the sole provider. For example, a Colorado employee without a significant other or children needs to earn far less than an employee supporting a family of four. This is for obvious reasons. Feeding four people costs more than one. Therefore, living wage varies not only by location but also by the size of the family supported.

Living wage in Denver, for example, requires a single employee to earn $12.95 which is above the current minimum wage. If that employee supports another adult and two children that number rises to $28.01, almost three times minimum wage. See your local living wage calculated using this calculator from MIT.

Colorado labor law final paycheck infographic

Colorado minimum wage vs. living wage

Minimum wage laws began as a way to end sweatshops and require employers to pay a living wage. Generally over time minimum wage laws in the United States failed to keep up with living wage requirements. Federal minimum wage set by the Fair Labor Standards Act is far below the living wage calculated in most parts of the country. Twenty-nine states have state minimum wages higher than federal law, including Colorado. Amendment 70 to the Colorado Constitution set minimum wage on a stair step to 2020 when increases tie to inflation.

Employees earning the Colorado minimum wage may still not reach a living wage. Considerations for calculating living wage include home prices, rent costs, utilities, food, transportation and healthcare. Although these are basic costs they do not include many expenses that Colorado employees may face. Nor do they include other financial considerations like retirement savings or entertainment.

Considerations for Colorado living wage

A living wage is not uniform across Colorado. Basic family expenses vary considerably across the state. For example, rent and home prices in Denver are far more expensive than most rural parts of Colorado. As expenses increase, so too does the living wage required to afford those expenses. Living wage is not always a linear increase with the urban density. For example, the Colorado Springs metro area requires only a slight decrease from the Denver metro area. Generally, however, urban areas are more expensive than rural areas in Colorado.

An important issue in Colorado is that living expenses are increasing at a rapid rate compared to wages. Studies of government data reflect living expenses increased three times as fast as wages. You can easily see how this happened with the explosion of both home and rent costs compared to even the increase in Colorado minimum wage. This is not a Denver problem. Growth in other large Colorado cities like Greeley, Loveland and Pueblo face the same struggles. Urbanization is not the only factor driving higher living costs. Many mountain communities have high living wages due to expensive housing costs, particular around tourist destinations.

A living wage in Colorado

Colorado employees must consider their location and how local cost variance affects their ability to support their families. The size of the family and location are key issues in self-sufficiency. An individual employee in Colorado needs to earn between $10.75 and $13 hourly just to sustain basic living costs. Note that even the lowest cost area of the state is above the Colorado minimum wage. For a family of four the living wage ranges from $24.00 to $29.00 far above the state minimum wage.

Unfortunately two income households do not fare better on minimum wage. In Denver a two income household with no children needs two earners making $10.55 hourly which is still above minimum wage. In lower cost areas a two income household with no children earn a living wage at minimum wage but fall below if they have a child.

This demonstrates how financially precarious life can be for many Colorado families. Lost wages or a lost job can send a family already struggling to meet their basic needs into complete financial collapse.

Legal issues and a living wage in Colorado

Families earning at or below a living wage in Colorado often work jobs at or near minimum wage. They may rely upon working multiple jobs (full or part time) and earning overtime pay. An employer refusing to pay wages earned by employees can have substantial effect on the employees and their families.

Employers who pay non-exempt employees below minimum wage steal from their workers and violate federal and state minimum wage laws. Employees in this situation have rights under federal and state law to recover unpaid wages through administrative or judicial means.

The same happens when employers fail to pay overtime pay owed to non-exempt employees. Employees earn overtime pay under federal and state wage laws. This is a higher rate of pay than minimum wage or the employee’s regular rate of pay. Employees can recover unpaid overtime pay through Colorado administrative procedures or in court.

Employers also sometimes fail to pay wages at all. Some ways employers fail to pay wages owed include:

  • Not issuing paychecks at all;
  • Failure to pay a final paycheck;
  • Shifting hours from one workweek to another to turn overtime hours into regular pay hours;
  • Removing hours from timesheets;
  • Requiring employees to work off the clock during lunches or before/after shifts;
  • Deducting hours or pay for impermissible deductions.

If your employer failed to pay some or all of your wages then you have rights to recover unpaid wages and other relief under federal and state wage laws. These laws may allow you to recover liquidated damages doubling the amount of unpaid wages, out of pocket losses caused by the failure to pay wages, attorney’s fees and court costs.

Additionally, your employer may not retaliate against you for complaining about or reporting unpaid wages. If your employer terminates you or takes other legal action for complaining about unpaid wages or reporting unpaid wages to a government agency then you have rights to recover for lost wages and other harm.

If you believe any of these unlawful acts occurred to you then you should talk to an unpaid wage lawyer in Colorado right away. An employment lawyer can advise you on your rights and how to proceed to receive the wages you earned. Speak to an unpaid wage lawyer as soon as possible. Many wage claims have short periods that require you to act to preserve your claim. The longer you wait to talk to a lawyer the more you risk not receiving the wages you earned.

FLSA overtime pay exemption dealership service advisors

Supreme Court veers on Fair Labor Standards Act exemptions

The Fair Labor Standards Act (FLSA) establishes minimum wage and overtime pay protections for all employees in the United States who are not exempt from its provisions by statutory exemption who work for covered employers or they are individually covered by the statute. FLSA contains many exemptions for minimum wage and overtime pay for a range of jobs and job duties (including lawyers). At stake in these exemptions is the right for employers to pay employees on a salary basis, free from overtime pay. As employees continue to work more hours both inside and outside the workplace, employers have an increasing incentive to expand the scope of these exemptions to avoid paying overtime pay. The Supreme Court handed employers a huge signal that it would be an ally to that goal in Encino Motorcars, LLC v. Navarro decided this month.

The details on Encino Motorcars, LLC v. Navarro

Encino Motorcars deals with whether service advisors are exempt under the FLSA exemptions related to car salespeople, mechanics and partsmen at dealerships. Service advisors are the people you talk to when you take a car to a dealership for repairs or maintenance. Although their jobs definitely involve sales on behalf of the mechanic shop, the question before the Supreme Court was whether the service advisors are mechanics or car salespeople within the meaning of the FLSA’s exemption for these roles.

A 5-4 majority of the Supreme Court held service advisors are exempt from minimum wage and overtime pay requirements under the FLSA’s exemption applying to mechanics and car salespeople. The majority opinion, written by silent but deadly Justice Thomas, provides a fairly tortured reading of the statute and casually abandons precedent to reach its decision.

Statutory FLSA exemption for certain dealership employees

The exemption at issue is found at 29 U.S.C. §213(b)(10)(A) which reads:

any salesman, partsman, or mechanic primarily engaged in selling or servicing automobiles, trucks, or farm implements, if he is employed by a nonmanufacturing establishment primarily engaged in the business of selling such vehicles or implements to ultimate purchasers;

The majority acknowledges that service advisors are neither car salespeople nor mechanics. The majority also acknowledges that they are not partsmen (who manage the parts supply for the dealership) but suggests at least that maybe service advisors are pretty much partsmen. The majority rephrases the statutory exemption to say it applies to, “any salesman…primarily engaged in…servicing automobiles” for which the majority finds they do because they provide service to owners related to their cars.

The core of the majority’s analysis is that:

  1. The service advisor is a salesperson because he or she sells mechanic and maintenance services to car owners; and
  2. The service advisor provides car owners a service by selling repair services and acts as customer service for the mechanic department.

The majority calls this the “best reading” of the statute. Wut.

It’s clear that service advisors are salespeople. They are the sales and customer service face of the mechanic department. However, are they, “primarily engaged in selling or servicing automobiles”? The majority points out that both parties agree they neither sell cars nor repair them. However, the majority insists “servicing automobiles” means anything that services the car physically or customers in seemingly any manner possible–so selling repair services means servicing the automobile.

It’s hard to take the majority’s interpretation with a straight face, especially if you read the sad attempt to change the meaning of the word “or” as the majority does. But let’s pretend the majority is right that the statute really means a “salesman” meets the exemption if he or she is “primarily engaged in…servicing automobiles”. If “servicing automobiles” includes sales and customer service then the statutes doesn’t need to state “selling” as independent of “servicing”. The majority makes part of the statute superfluous in its interpretation which is a statutory interpretation no-no.

The dissent goes into greater detail why the meaning of “servicing” and the roles of the three jobs listed do not find a logical home for the majority’s interpretation. An important aspect raised by the dissent is the legislative history of the FLSA. In 1961 Congress added an exemption for all dealership employees but in 1966 amended the act to just three roles. Unlike many instances where legislative history is plucked over for helpful comments by individual members, here we have the entire body taking a specific act to restrict the exemption within dealerships. Rarely do we get such clear and singular language from Congress. The majority says we don’t need to look at the history when the language is clear. The majority might be right–but the language is clearly not what they say it is.

Narrow interpretation of the statutory exemption

The majority’s casual rewrite of the language of the statute is perhaps beaten by its casual rewrite of precedent. The majority rejects the intermediate appellate court’s argument that FLSA exemptions should be interpreted narrowly. It says, “gee, we just can’t find a textual message in the statute that we should interpret these exemptions narrowly”. The majority importantly opposes the normal cannon that remedial statutes like the FLSA are interpreted broadly in favor of its protected class to give effect to the remedial purpose.

The majority says the remedial purpose needs balance, so a “fair reading” is necessary, citing to precedent in the court’s regressive posture of the past thirty years undermining remedial statutes. The dissent plucks this argument apart by citing to cases in the years following passage of the FLSA explicitly rejecting the premise that the statute’s exemptions should be read expansively and that they are necessarily narrow.

What this will mean for FLSA overtime and minimum wage protections

Sadly, the Supreme Court’s turn away from narrowly reading FLSA exemptions to minimum wage and overtime pay likely means this is the first, rather than the only, exemption that will receive “fair reading” rather than a narrow interpretation. This case will likely serve as the lighthouse for future cases seeking to expand FLSA minimum wage and overtime pay exemptions, illuminating the way for employers to underpay hard-working employees. The direct impact of this case might be small but its long term effect will likely reach a broad group of workers.

This decision is completely unsurprising in every way. The regressive robes in this country, like Thomas and his allies on the bench, are part of the wave of conservative lawmakers, lobbyists and jurists rolling back worker rights and protective measures in many other areas of law. The willingness to so casually rewrite statutes and ignore precedent as the majority does here will only lower the bar for future cases pursuing expansion of overtime pay exemptions.

 

 

 

Denver employment lawyers

Colorado Labor Law

Employees in Denver and other parts of Colorado enjoy protection under federal, state and local laws. Employees enjoy protections under wage laws, labor organizing laws, anti-employment discrimination laws, worker safety laws, benefit plan laws, worker’s compensation, contract law, medical leave laws and a variety of other statutes and regulations. On several areas of labor and employment law, an employee’s claim may fall under both federal and state law. Colorado employment lawyers understand the fit between these laws and how to best represent their clients claims. Filing claims under federal or state law can dictate what courts a worker can enter. Which court hears an employee’s case may affect the available remedies, the available jury pool and other factors that affect the worker’s probability of a successful claim.

Colorado Revised Statutes Title 8: Labor and Industry

Most Colorado labor and employment laws exist within Colorado Revised Statutes title 8. This includes wage and hour laws, workers compensation and the Colorado unemployment benefits system. Like most states, the wage and hour sections of the Colorado Revised Statutes contains some provisions that mirror federal wage and hour laws but also includes provisions expanding upon federal law. The Colorado Revised Statutes provides greater specification on the timing and method of wage payments, such as payroll deductions, pay dates, pay frequency and payment of wages after termination. Workers compensation and unemployment benefits are solely state law issues.

Colorado Revised Statutes Title 24: Government

Title 24, Article 34 of the Colorado Revised Statutes (C.R.S. 24-34-401 et seq) includes the Colorado state law prohibiting employment discrimination. Title 24 of the Colorado Revised Statutes makes it unlawful for an employer, employment agency, or labor union to discriminate on the basis of:

  • Age
  • Disability
  • Creed
  • Color
  • Ancenstry
  • National origin
  • Sex
  • Sexual orientation
  • Race
  • Pregnancy and childbirth

The protected classes of employees under Colorado law closely mirrors federal law with the exception that it specifically prohibits sexual orientation. Currently federal courts hold that sexual orientation is not prohibited by Title VII of the Civil Rights Act or any other federal anti-discrimination law. Colorado law closely follows the meanings and usage of reasonable accommodations, harassment and retaliation related to employment discrimination.

Additional protections for employees under Title 24

This title of the Colorado Revised Statutes also prohibits employers from discharging employees for off premises work activity unless that activity is closely related to a bona fide occupational requirement or the activity would create a conflict of interest for the employer.

Additionally, this section of the Colorado Revised Statutes protects the right to three days of leave for the victim of domestic abuse or sexual assault for medical care, seeking legal help, or protecting himself or herself from further abuse.

A claim under Title 24 of the Colorado Revised Statutes must be filed with the Colorado Civil Rights Commission within six months. The exception is for claims that the employer discharged the employee for off work activity. Those claims may be filed in district court within the applicable limitations period for filing a civil suit. (Galvan v. SPANISH PEAKS REG. HEALTH CENTER, 98 P.3d 949 (Colo. Ct. App. 2004))

Colorado labor and employment laws and employment lawyers

This post is just the tip of the iceberg of the labor and employment laws that cover Colorado workers. If you believe your employer mistreated you in hiring decisions, termination decisions, or during your employment then you should speak with employment lawyers in Denver, Colorado right away about your concerns. Many claims have brief limitations periods that require employees to take action to preserve claims.