Informing Strategic Enforcement Practices: Minimum Wage Compliance and Complaints in the Denver Area

This study uses Current Population Survey (CPS) Outgoing Rotation Group data—widely considered the best publicly available survey data on hours and earnings—to estimate the incidence of minimum wage violations in the Denver-Aurora-Lakewood Metropolitan Statistical Area (hereafter “Denver MSA” or “Denver area”) over the past fifteen years. We find that:

1. At least 45,000 workers a year on average were paid below the applicable state or local minimum wage within the Denver-Aurora MSA from 2007 to 2022, the period of the study. Given our conservative methodology, we expect the true number to be even higher.
2. We estimate that these workers on average lost at least $136 million annually, or nearly $3,000 per worker.
3. The number of workers paid below the applicable minimum wage has risen over recent years as the Colorado state and Denver minimum wages have gone up and pay has lagged.
4. Minimum wage violation rates are highest in private households, food services and drinking places, personal and laundry services, and accommodation.
5. Women, noncitizens, and people of color are more likely to experience minimum wage theft. Workers identifying with more than one of these groups are particularly likely to experience minimum wage theft. For example, Black and Latine female noncitizens are roughly four times as likely than white male citizens to be paid below the minimum.
6. Younger and older workers are more likely to experience a minimum wage violation than mid-career workers.
7. Part-time workers and those without a high school diploma are more than three times as likely to be paid below the minimum than full-time workers and high school graduates.

We supplement our study of underlying minimum wage violations in the Denver MSA with an analysis of minimum wage complaints received by Denver Labor since the local minimum wage ordinance went into effect in January 2020. Based on our analysis of Denver Labor complaint data, we find that:

1. “Active cases,” or those initiated by the office without a complaint, accounted for 32 percent of all cases yet nearly 46 percent of total compensation to workers.
2. Active cases averaged $770 in compensation per worker (including back wages, damages, and interest), nearly double the compensation found per worker across all other cases ($408).
3. The four industries where roughly 80 percent of proactive cases were carried out—personal and laundry services, retail trade, food services and drinking places, and administrative and support services—are among the seven highest violating industries, based on our analysis of CPS data.