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Colorado Minimum Wage, Salary Threshold for Overtime Exemption Will Rise in 2025

By Hannah Nelson posted 11-27-2024 08:33 AM

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Colorado has updated its minimum wage and salary threshold for exemption status for 2025 as mandated by the Colorado Constitution. On January 1, 2025, the minimum wage will rise 39 cents to $14.81 per hour. The salary threshold for overtime exemption status will be $1,086.25 per week ($56,485 annualized), up from $1,057.69 per week ($55,000 annualized).

Each year, Colorado’s minimum wage and salary threshold for exemption status are adjusted annually for cost-of-living increases. This adjustment is measured by the Consumer Price Index (CPI) used for Colorado since the 2020 minimum wage of $12.00 per hour was implemented. These values are calculated by the U.S. Bureau of Labor Statistics. This year’s Denver-Aurora-Lakewood CPI increase was calculated to be 2.7%, which was applied to 2024 amounts to get the 2025 amounts. The maximum tip credit allowed remains $3.02 for tipped employees.

In addition to the above updates for minimum wage and salary thresholds for exempt status, some other state-mandated pay amounts have been updated. Click here for the current and 2025 wage orders.

In some areas of Colorado, a higher local minimum wage supersedes the state minimum wage. State and local laws also provide for a tipped minimum wage. The following is a look at the various minimum wage rates for 2025 in Colorado and local jurisdictions:

Colorado: $14.81 ($11.79 with tip credit)

Denver: $18.81 ($15.79 with tip credit)

Boulder (city): $15.57 ($12.55 with tip credit)

Boulder County (unincorporated areas): $16.57 ($13.55 with tip credit)

Edgewater: $16.52 ($13.50 with tip credit)

Here are the Colorado pay thresholds for the applicable exemption categories:

Executive/Administrative/Professional Employees (EAP): $1,086.25 per week ($56,485 per year)

Highly Technical Computer Employees: $34.07 per hour (or the EAP salary listed above)

Highly Compensated Employees: $127,091 per year

In addition to the state minimums, the federal government also has a minimum wage and minimum salary threshold. An employer in Colorado must apply the higher of the two options. In 2025, the federal EAP salary threshold was set to be higher than the Colorado salary threshold. However, on November 15, 2024, a U.S. District Court blocked the U.S. Department of Labor’s (DOL’s) final rule increasing the salary threshold for the EAP exemption. Read more about that decision in this Employers Council article.

As such, the federal salary threshold is less than the Colorado salary threshold. Therefore, the Colorado salary threshold will apply to all employers subject to Colorado’s Wage Act and Colorado’s Overtime and Minimum Pay Standards.