One Fair Wage - Eliminate Tipped Minimum

The Problem

The tipped minimum wage is a legacy of post-slavery economics. After emancipation, restaurants hired Black workers and told them to earn their wages from customer tips - allowing employers to pay nothing. This system persists today.

In Denver, the tipped minimum for food and beverage workers is $16.27/hr (2026) - $3.02/hr less than the city’s standard minimum. Statewide the tipped minimum is $12.14/hr (2026). Employers are supposed to make up the difference if tips don’t reach the full minimum. In practice:

• Wage theft in tipped industries is rampant - employers routinely fail to make up shortfalls
• Income is unpredictable and volatile - one slow Tuesday means rent is short
• Workers are forced to tolerate harassment from customers because their income depends on it
• Tipped workers experience poverty at 2x the rate of non-tipped workers
• The system is racist: tipped workers of color earn 56% less in tips than white workers for the same work

What Denver Currently Does

Denver’s tipped minimum wage for food and beverage workers is $16.27/hr in 2026, up from $15.79/hr in 2025, and rises to $16.82/hr in 2027; Colorado’s statewide tipped minimum is $12.14/hr in 2026 (Denver Labor; Colorado Department of Labor and Employment). Colorado already has a smaller tip credit ($3.02/hr) than the federal level ($5.12/hr), but the gap still forces tipped workers to rely on customer generosity for a significant portion of their income. Denver has an estimated 35,000-40,000 tipped workers, concentrated in restaurants, bars, hotels, and personal services (BLS, 2023).

Our Solution

Eliminate the tipped minimum wage in Denver

• All workers receive the full minimum wage ($25/hr at full implementation) regardless of whether they receive tips
• Tips remain 100% the property of workers - employers cannot touch them
• Tip pooling permitted only when ALL employees (including back-of-house) are included equitably
• Tip theft by employers is prosecuted as wage theft with triple damages
• No service charges masquerading as tips - if a restaurant adds a service charge, it must clearly disclose that it is NOT a tip and does NOT go to workers

Transition Support

• 2-year tax credit for restaurants and bars to offset the wage differential during transition
• Free business model consulting through Denver Economic Development
• Public education campaign: “In Denver, your server earns a living wage. Tips are their bonus, not their survival.”

International Evidence: Most Countries Never Had a Tipped Minimum

The tipped minimum wage is an American invention rooted in post-slavery economics. Most of the world finds it bizarre that American restaurants pay workers $2-5/hr and expect customers to make up the difference. The seven US states that eliminated tipped wages prove it works here too.

How We Pay For It

Restaurants pay their workers. The seven states that already have One Fair Wage (California, Washington, Oregon, Montana, Alaska, Minnesota, Nevada) have thriving restaurant industries. Restaurant job growth in these states exceeds tipped-wage states.

Menu prices may increase 5-10%. This is transparent and honest - unlike the current system where your server’s poverty is hidden behind a smile.

Frequently Asked Questions

“Won’t servers make less because people will stop tipping?” In One Fair Wage states, total compensation (wages + tips) is higher than in tipped-wage states. People still tip. The difference is that a slow night doesn’t mean your server can’t pay rent.

“Restaurants operate on thin margins.” Then their business model is subsidized by worker poverty. If a restaurant can only exist by paying workers $15/hr and hoping customers make up the rest, that’s not a viable business - it’s a subsidy extracted from the lowest-paid workers.

“What about fine dining servers who make $60K+ in tips?” They’ll still make that. They’ll just ALSO make a guaranteed base wage. The people this helps most are the workers at Denny’s and Applebee’s, not the sommelier at the steakhouse.

“Won’t this hurt small, independent restaurants more than chains?” The 2-year tax credit for small businesses specifically addresses this. But the evidence from One Fair Wage states shows independent restaurants thrive - because their workers can actually afford to eat at other local restaurants. Higher wages create a virtuous cycle of local spending. And the playing field is level: when every restaurant pays the same base wage, no one has a competitive disadvantage.

Who Opposes This (and Why)

• Colorado Restaurant Association is the primary organized opposition to eliminating the tipped minimum.
• National Restaurant Association (nicknamed “the other NRA”) has spent millions nationally fighting One Fair Wage.
• Some high-earning servers at fine dining establishments worry about tip reduction (though evidence shows tips remain strong in One Fair Wage states).

References

• Colorado Department of Labor and Employment, 2025 Minimum Wage Rates
• One Fair Wage, Tipped Worker Research and Policy Center reports (onefairwage.org)
• Economic Policy Institute, “Subminimum Wages in the States,” Policy Brief, 2023
• Bureau of Labor Statistics, Occupational Employment and Wage Statistics, Denver-Aurora-Lakewood MSA, 2023
• Allegretto & Nadler, “Tipped Wage Effects on Earnings and Employment in Full-Service Restaurants,” Industrial Relations 54(4): 622-647 (2015)
• National Women’s Law Center, The Tipped Minimum Wage and Its Impact on Women, 2023