Colorado Election Update: Employers Likely to Face Increased Minimum Wage; ColoradoCare Initiative Likely to Fail

This November, Colorado voters will make two key decisions that may have significant impact on Colorado employers: (1) whether to adopt Amendment 69, which would create ColoradoCare, a state-chartered universal insurance system, funded by a 10 percent payroll tax (the “ColoradoCare Amendment”) (see related article); and (2) whether to adopt Amendment 70, which would gradually increase the state minimum wage to $12.00 by 2020 (the “Minimum Wage Amendment”) (see related article).  Recent polling indicates that voters will likely overwhelmingly reject the ColoradoCare Amendment, but will approve the increase in minimum wage.[1] 

65 percent of Colorado voters polled in a recent Magellan Strategies survey oppose the ColoradoCare Amendment, with only 27 percent supporting the amendment and only 8 percent remaining undecided.[2]  This marks a significant decrease in support from a January survey where 43 percent of likely voters supported the amendment.[3]  Given the significant opposition indicated by the recent Magellan Strategies poll, it appears unlikely that Colorado employers will need to comply with ColoradoCare.

Colorado employers may, however, see an increase to the state’s minimum wage.  55 percent of Colorado voters polled in the Magellan Strategies survey support the Minimum Wage Amendment to gradually increase the state minimum wage to $12.00 by 2020, with 42 percent opposing the increase, while only 3 percent remain undecided.[4]  The current minimum wage in Colorado is $8.31, and is tied to the level of inflation.[5]  The Minimum Wage Amendment would increase the state minimum wage to $9.30 on January 1, 2017, and annually increase an additional $0.90 until the minimum wage reached $12.00 on January 1, 2020.[6]  Once the minimum wage reached $12.00, it would further adjust annually for cost-of-living increases.[7]  

The Minimum Wage Amendment would have a significant impact on employers.  Specifically, employers in industries with low profit margins, such as the restaurant and retail industries, would likely be required to eliminate jobs or reduce others, decreasing the quality of service.  There is also a lack of significant research regarding the effects of such an increase to the minimum wage, and there is a possibility that an unknown or unintended consequence could further increase costs on employers.

Campbell Litigation will continue to track these actions and report back when further updates are available.  For further information, please see the Colorado Secretary of State’s website for Amendment 69 and Amendment 70 (click here). 

[1] Ed Sealover, Minimum-wage-hike amendment winning, ColoradoCare getting crushed, Denver Business Journal (Sept. 6, 2016).

[2] John Frank, New Poll: Colorado voters favor minimum wage hike and presidential primary, The Denver Post (Sept. 7, 2016).

[3] Ed Sealover, More on the cover story: Chances of Amendment 69 single-payer health measure passing are better than some thing, Denver Business Journal (May 27, 2016).

[4] See Magellan Strategies 8/29/2016 – 8/31/2016 poll (available at http://magellanstrategies.com/colorado-amendment-70-voter-opinion-survey/) (last accessed Sept. 8, 2016).

[5] Colo. Const. art. 18 § 15.

[6] See Frank, supra note 2.

[7] Id.