Colorado tip pooling laws & tipped minimum wage
In Colorado, employers can pay tipped workers $12.14/hr as long as tips bring them to the $15.16 minimum — here's how that works and who can legally share your tips.
| Regular minimum wage | $15.16/hr |
| Minimum cash wage for tipped workers | $12.14/hr |
| Maximum tip credit | $3.02/hr |
| Tips belong to | Employees — always |
A tip credit lets an employer count your tips toward the minimum wage it owes you. Rates reviewed July 2026. Rates change — confirm with the Colorado labor department. Not legal advice.
What's specific to Colorado
Colorado caps the tip credit at $3.02/hr. Denver and other localities set higher minimums.
Colorado raises its minimum wage every January, and several cities go higher
Colorado’s minimum wage is $15.16 an hour in 2026, and it climbs every January 1 because the state constitution ties it to inflation. Employers may pay tipped workers a cash wage of $12.14 an hour and claim a tip credit of up to $3.02, as long as your tips bring you to at least $15.16 for the hours worked.
Colorado is one of the states that lets local governments set their own, higher minimum wage. In 2026 Denver’s minimum is $19.29 an hour with a tipped food-and-beverage cash wage of $16.27; Boulder and unincorporated Boulder County sit at $16.82; and Edgewater is $18.17. If you work inside one of these jurisdictions, you are owed that local rate, not the lower state figure.
The $3.02 tip credit is a cap, and it can shrink where the local wage is higher
Statewide, the most an employer can subtract as a tip credit is $3.02 an hour. Your cash wage plus tips still has to reach the full applicable minimum wage every workweek, and if it does not, your employer owes the difference in that paycheck.
Local rules can change the math. Edgewater, for example, set a larger tip credit of $4.67 for 2026, while Denver keeps the $3.02 credit on top of its higher base. The rate that applies is always the one for the place where you actually do the work.
How to recover unpaid or withheld tips in Colorado
Colorado protects your tips as your property. Under the state’s wage rules, employers, managers, and supervisors may not take a share of your tips, and a mandatory tip pool may only include employees who customarily receive tips.
If your cash wage plus tips fell short of the minimum, or an employer or manager kept part of your tips, you can file a wage complaint with the Colorado Department of Labor and Employment, Division of Labor Standards and Statistics. You may also contact the U.S. Department of Labor Wage and Hour Division.
Tip pooling in Colorado
Colorado follows the federal baseline: employers may require tip pooling. If your employer takes the tip credit (pays $12.14/hr cash), the pool may only include customarily tipped workers — servers, bussers, bartenders, runners, hosts. Back-of-house can only be included if everyone is paid full minimum wage with no tip credit. Managers and supervisors are always excluded.
One federal rule applies everywhere: managers and supervisors can never take from a tip pool. Separately, credit card processing fees may only be deducted from tips where state law allows it.
What this means for your tip-out
Because part of your legal wage in Colorado comes from tips, the employer's tip credit assumes those tips reached you. Use the tip-out calculator to split a shift by your house's percentages or by hours, and see standard tip-out percentages to check whether your house's rates are typical.
Colorado tip law FAQs
What is the tipped minimum wage in Colorado?
Employers in Colorado may pay tipped employees a cash wage of $12.14/hr and claim a tip credit of up to $3.02/hr toward the $15.16 minimum wage. If tips don't close the gap in a workweek, the employer must make up the difference.
Is mandatory tip pooling legal in Colorado?
Colorado follows the federal baseline: employers may require tip pooling. If your employer takes the tip credit (pays $12.14/hr cash), the pool may only include customarily tipped workers — servers, bussers, bartenders, runners, hosts. Back-of-house can only be included if everyone is paid full minimum wage with no tip credit. Managers and supervisors are always excluded.
Can my manager take a share of the tip pool in Colorado?
No. Federal law prohibits managers, supervisors, and owners from keeping any portion of employee tips in every state, including Colorado. A manager may keep only tips they directly and solely earned (e.g., a table they personally served start to finish).
Does Colorado let cities set a higher tipped minimum wage?
Yes. Colorado allows local minimum wages, and Denver, Boulder, unincorporated Boulder County, and Edgewater all set rates above the state figure. If you work in one of those places, your employer must pay that local rate, including its own tipped cash wage where one applies.
Can my manager take part of my tips in Colorado?
No. Under Colorado’s wage rules your tips are your property. Owners, managers, and supervisors may not keep any portion of them, and a required tip pool may only be shared among employees who customarily and regularly receive tips.