Restitution Stories

Three Denver workers receiving restitution checks from Auditor O'Brien and two members of Denver Labor.

Read below some of our returned wage stories since 2020:

Minimum Wage Stories

Valet Parking Company Raises Wages After Investigation

Denver Labor initiated a wage investigation of a local valet parking company after seeing a job posting that advertised a starting pay rate below Denver's citywide minimum wage. Our team of analysts informed the company that they could not claim a tip credit for the tips received by their employees as they are not part of the food and beverage industry. The Citywide Minimum Wage Ordinance only allows businesses in the food and beverage industry to take a tip credit to reduce their minimum wage obligation when workers receive that amount in tips. The local valet parking company worked with our office to raise wages and pay restitution to all underpaid employees. As a result, twenty employees received a total of $994.11 in restitution.

Underpaid Employees at Marijuana Dispensary Recover $7,600 in Restitution

Denver Labor’s minimum wage team received a complaint through our website that a local marijuana dispensary was paying its employees less than Denver’s required minimum wage. The business was also claiming a tip credit based on the hourly and commission wages that the employees were receiving. Our office educated the employer about using the tip credit, which can be claimed only in the food and beverage industry when employees earn at least that amount in tips. The business corrected the mistake, raised its wages, and returned $7,621.21 in restitution to 78 employees.

Thirty-three Employees Received $24,875.55 in Restitution

The Denver Labor team received a minimum wage complaint through our website because a national beauty service retailer was paying their employees less than the required Denver’s minimum wage and was claiming a tip credit. Our minimum wage team educated the employer about the tip credit, which is only allowed for businesses in the food and beverage industry to reduce their minimum wage obligation as long as their workers receive that amount in tips. The company corrected the wages for all their employees, and our office recovered $24,875.55 for 33 workers.

Effective Active Enforcement Helps Retail Store Comply with Minimum Wage

Denver Labor’s minimum wage team can conduct active wage enforcement investigations in industries or businesses with a higher risk of non-compliance with Denver’s minimum wage requirements. Our team initiated a wage investigation at a paint and coating retail store and found that the employer underpaid their workers in 2020. The business proactively corrected the underpayment while Denver Labor analysts reviewed their payrolls. As a result, five employees received $650.88 in recovered wages.

 

Denver Labor Recovers Almost $9,000 for Youth Employees

A local performing art group was paying their youth employees less than Denver’s minimum wage. Based on city’s ordinance, employees under 18 years old cannot earn less than the local minimum wage, unless the company obtains certification as Certified Youth Employment Program approved by Denver Economic Development & Opportunity. Denver Labor reached out to the employer, educated them about the ordinance requirements, and recovered $8,978.03 for 33 employees.

Valet Parking Company Returns $38,895.97 to Employees

After identifying valet parking as a high-risk industry for underpayments, Denver Labor conducted a routine compliance audit on a national valet parking company. Their payroll records showed that the company was taking a tip credit for the tips received by their employees, which is only allowed in the food and beverage industry based on Denver's Citywide Minimum ordinance. When Denver Labor notified the business that they could not claim a tip credit, the company worked with our team to raise wages and resolve the underpayment. Forty-nine employees received $38,895.97 in restitution.

Nail Salon Returns $7,882.94 to Employees

According to Denver's minimum wage ordinance, businesses in the food and beverage industry can claim a tip credit of up to $3.02 if their employees earn that amount in tips. Denver Labor recently closed an underpayment case where a local salon believed that they could also take a tip credit from the wages earned by their nail workers. After educating and working with the minimum wage team, the business came into compliance and returned $7,882.94 to 10 employees.

Active Enforcement Helps Return More Than $3,200 for Two Employees

On a popular online classifieds site, a local design store advertised a job opportunity in Spanish that was paying $15.50 per hour. As a result of our minimum wage active enforcement, Denver Labor opened an investigation and requested payroll records for January 2020, January 2021, and January 2022. Our team found two employees were underpaid in 2021 and earned $14.00/hour and $13.20/hour, below Denver’s minimum wage of $14.77/hour in 2021. The company was cooperative, provided all payrolls, and completed restitution promptly upon being notified of their error. The minimum wage team recovered $3,223.79 for two employees.

Janitorial Employees Receive More Than $32,000 in Restitution

A janitorial contractor cleaning a college campus located in Denver failed to pay employees Denver’s citywide minimum wage for 1.5 years. After an employee submitted a complaint to Denver Labor, all employees’ hourly rates increased to at least meet the minimum wage, and 25 janitors received $32,089.27 in restitution.  

Denver Labor Recovers Unpaid Wages for Afghan Refugee

Third parties can submit a wage complaint on behalf of an underpaid worker. In this restitution case, the African Community Center of Denver reached out to Denver Labor because an Afghan refugee they helped find employment to perform construction work was being paid below Denver’s citywide minimum wage of $15.87/hour. When Denver Labor notified the local contractor about the wage investigation, they eagerly worked with our office to resolve the underpayment and returned the unpaid wages in less than one week. The employer also raised the worker’s hourly wage to $16/hour.

Denver Labor Recovers More than $2,500 for Remote Employees

A call center located in Colorado Springs was not paying Denver’s minimum wage to remote employees working at Denver addresses. After receiving a wage complaint, our office contacted the employer and educated them on Denver’s minimum wage, which requires paying the local minimum wage to employees performing their work in Denver, even if the company is located in a different county. Denver Labor was able to recover $2,521.98 for eight employees. 

A Cooperative Beauty Salon Returns Wages to Employees

Starting in 2022, Denver Minimum Wage ordinance allows Denver Labor to initiate investigations without receiving a wage complaint. Our analysts found a salon job opportunity on a classified website that offered $15.00/hour and opened an investigation. The team requested payroll records for January 2020, January 2021, and January 2022 and found that the business was paying $15/hour instead of the minimum wage of $15.87 in 2022. After being notified of their error, the company promptly provided all requested payrolls and completed restitution. Seven employees recovered $423.29 in backpay.

Marijuana Dispensary Updates Wages for 13 Employees

Denver Labor received a complaint of a local marijuana dispensary with multiple locations in the metro area. The dispensary was not adjusting wages to comply with Denver’s citywide minimum wage when the work was performed at the Denver location. After educating the employer on how to track hours and update wages for those employees working within the City and County of Denver, our team recovered $398.69 for 13 employees. 

Coffee Shop Baristas Receive Back Pay

A local coffee shop was paying their tipped baristas $10 per hour—below the tipped minimum wage of $11.75 required for the food and beverage industry in 2021. Denver Labor initiated the investigation after receiving multiple wage complaints from their employees, who contacted our office through the web form available on our website. The company provided all payrolls and promptly returned $1,834.64 in back pay to 14 employees upon being notified of their error.

A National Retailer Located at Denver’s Border Returns More Than $25,000 to Employees

A national retailer located on the Denver side of the border between Denver and Jefferson Counties was paying the state minimum wage rate for two years instead of Denver’s Minimum Wage. An employee saw a social post from our office and submitted a complaint to initiate an investigation. Upon receiving the notice of investigation and information request from our office, the employer performed a self-audit and paid a restitution of $25,268.47 for 45 employees. This case illustrates how some national companies with the Human Resources department located outside of Colorado may be unaware of local minimum wage law and underpay their workers in the City and County of Denver.

Application of State Minimum Wage Leads to $24,286 in Restitution for Restaurant Workers

A large local restaurant claimed and documented the tip credit correctly but paid Colorado minimum wage instead of Denver’s citywide minimum wage to their workers for all of 2020 and part of 2021. An employee found the Auditor’s Office by searching on the web and they emailed the office to learn more about Denver’s minimum wage for tipped workers. When our team contacted the business, the manager provided Denver Labor all the required documentation and promptly returned $25,286 of unpaid wages for 19 employees.

Local Restaurant Pays $18,000 in Returned Wages

An underpaid employee from a local restaurant in Denver reached out to us by submitting a wage complaint. We discovered their employer had not paid the required citywide minimum wage rate in 2020 and 2021.

After working with our analysts, the restaurant reacted quickly and returned nearly $18,000 to 20 employees. Once more, this story showcases the willingness of local businesses to collaborate with our team and do what’s right for their workers.

Nearly 200 Employees Compensated, Wages Permanently Raised

Home improvement sales employees who were compensated by a mix of base pay and commission were not being paid Denver’s citywide minimum wage when their sales goals were not met. Almost $16,000 was recovered for 194 employees and all employees’ base wage rates were raised to prevent future underpayments.


National Store Cooperates to Increase Wages

A large national retailer with a store near Denver’s border mistakenly thought it was subject to the state minimum wage instead of Denver’s minimum wage. Through education and cooperation, the employer corrected the mistake, raised employees’ wages, and paid 25 employees more than $2,600 in back pay.

 

Janitorial Company Faces Back Pay and Fines

A janitorial company incorrectly classified its employees as independent contractors to avoid having to pay minimum wage. The company refused to work with Denver Labor to correct its wage rates and achieve compliance with the law. Our office worked with an outside collections agency to recover $4,000 in unpaid wages for 24 employees, in addition to fines.

 

Fast-Food Chain Raises Wages

Operators of a fast-food restaurant near Denver’s border mistakenly paid less than Denver’s minimum wage. Managers worked with our team to repay more than $7,000 in underpayments for 46 employees, and they permanently increased hourly pay.


Hair Salon Incorrectly Deducts Tips

Hair stylists in a national hair salon chain were paid the minimum wage, but their employer claimed the tip credit that applies only to the food and beverage industry. Our team recovered $16,000 for 25 employees.

               

Prevailing Wage Stories

Apprentice Receives $2,654 in Restitution for Prevailing Wage Work

A team member in our prevailing wage division found that a city contractor classified and paid an employee as an apprentice for three months before registering them in an approved apprenticeship program. Denver’s Prevailing Wage ordinance requires all apprentices to be enrolled in an apprenticeship program registered with the U.S. Department of Labor’s Bureau of Apprentice Training. Until the employee received the required apprentice certificate, the employee should have been classified and paid as a journey worker for all work performed on the prevailing wage project. After identifying the issue, Denver Labor helped recover $2,653.68 in restitution for the employee.

Denver Labor Recovers More Than $207K for Waste Services Employees

Employees working on trash removal services and disposal site contracts obtained $207,428.94 in restitution. The prevailing wage team found that workers were classified correctly. However, the contractor failed to meet prevailing wage requirements by claiming fringe credit that had not been approved by our office.

Fringes are guaranteed benefits that the employer provides for the employee’s health and welfare, such as health insurance, paid time off or 401K. Contractors must translate these benefits into an hourly fringe credit, which must be approved by our prevailing wage analyst to count toward their prevailing wage requirements.

Denver Labor worked cooperatively with the contractor to obtain accurate documentation, approve fringes retroactively, and calculate restitution for 35 employees.

A Cooperative Contractor Returns $85,826.48 to Employees at the Denver Zoo

A contractor performing custodial work at the Denver Zoo significantly underpaid its employees resulting in $85,826.48 owed to 21 employees. The contractor started performing the custodial work at the Denver Zoo before the Auditor’s Office discovered that neither the contract nor the contractor had not been set-up in our compliance software. The contractor had not submitted certified payroll records for our review. The underpayments were the result of the contractor paying its employees less than the custodian prevailing wage. The contractor was very cooperative and issued restitution checks expeditiously.

Worker Receives $7,043.41 in Restitution

The Auditor’s Office enforces Davis-Bacon compliance on City and County of Denver/federal projects. In one recent case, an out-of-state crane contractor employing a power equipment operator for cranes on a Davis-Bacon project underpaid its employee. As a result, one employee received $7,043.41 in restitution.


Denver Labor Recovered $11,350 for Airport Employees in Badge Fees

A contractor at Denver International Airport was deducting $250 in $50.00 increments from employees’ paychecks as a deposit in case employees don’t return their badges within the allotted timeframe upon termination of employment. Badge fees are considered a cost of doing business and cannot be charged upfront or considered a condition of employment. Badge fees may only be charged back to the employee if an employee loses their badge during employment, and if the contractor can provide an invoice from Denver International Airport Security and a signed statement from the employee. Denver Labor collected restitution for 48 employees totaling $11,350.00.

Misclassified Employees Received a Total of $9,575.22 at Denver International Airport

A contractor installing a solar system at the Denver International Airport misclassified their employees as roofers instead of electricians, which resulted in a significant underpayment for the workers. The minimum prevailing wage rate for roofers was $16.56 compared to the $52.68 prevailing wage that the contractor was required to pay for electrical work, which increased to $54.97 after the project’s wage anniversary. This resulted in an underpayment of up to $38.41 per hour for the workers. After the investigation, the Denver Labor analyst team recovered $9,575.22 in total restitution payment to 7 employees.

$270k Recovered for Airport Workers

Denver Labor was contacted by an employee who had concerns about his fringe benefits. After conducting an investigation, which included meeting with the employer and union, a labor analyst was able to identify a significant underpayment to workers at Denver’s airport, including the need for $270,000 in restitution to a union pension plan. The investigation was highly cooperative, and all parties are working together to ensure payment of the restitution.

Denver Labor Works with Contractor to Get Correct Payment

After failing to submit certified payroll for nine months, an asphalt company submitted the proper documents. We found the contractor underpaid seven employees by more than a total of $18,000. Initially, the contractor calculated the restitution owed as greater than the actual amount due. But our office worked with the contractor to calculate the correct amount so they could pay the actual restitution owed.


Denver Prevailing Wage Preserves Fringe Benefit Rules

A company installing solar panels on a roof failed to pay the correct fringe benefit amounts into their employees’ 401(k) plans, resulting in a $2,200 total underpayment for 10 employees. Any fringe benefits claimed by a contractor must be approved and validated by Denver Prevailing Wage.


More than $100K Collected for Airport Workers

Our office received notice of a solar panel installation project, which began in January 2019, at Denver International Airport from employees completing the work. Upon further investigation, we discovered the contractor had not submitted certified payrolls for the work performed. The contractor was then notified and required to submit certified payrolls.

After the submission, our analysts determined not all employees were reported and the majority of the employees were misclassified according to prevailing wage and paid as “laborers,” as opposed to “electricians.” In March 2020, our team collected restitution for 62 employees totaling $104,350.  


Worker Receives Almost $2,000 in Owed Wages

A large earth-moving contractor employing power equipment operators and laborers paid more than $15,000 in total restitution to 37 employees. Our analysts determined the company was claiming unapproved fringe benefits, resulting in a failure to meet prevailing wage requirements. One trackhoe operator received almost $2,000 in back pay.


Employee Receives $3,800 in Restitution

An out-of-state contractor attempted to reduce the pay of an employee who was working in Denver by subtracting their travel expenses, resulting in a prevailing wage violation. The employee received more than $3,800 in restitution.


Denver Labor Protects Workers in Training

An electrical contractor had two apprentices working without journeymen on a city project for one day, resulting in a $350 prevailing wage underpayment. All apprentices working alone must be paid the journeyman prevailing wage rate.


   

Returned Wages

Our staff always works hard to get wages recovered for workers protected by the Prevailing Wage and Minimum Wage ordinances. In 2020, Denver Labor recovered more than $1 million dollars for unpaid workers, exceeding the previous annual record by more than $300,000.

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This graph shows Denver’s unpaid wages recovered by the labor division of the Denver Auditor’s Office by year. In 2013, $101,905 were recovered. In 2014, $142,977 were recovered. In 2015, $84,232 were recovered. In 2016, $701,787 were recovered. In 2017, $417,271 were recovered. In 2018, $265,243 were recovered. In 2019, $678,559 were recovered. In 2020, $1,017,363 were recovered. In 2021, Denver Labor recovered $690,268 for workers. As June 2022, Denver Labor recovered $765,664 for workers.

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AUDITOR TIMOTHY O'BRIEN, CPA
Denver Auditor



Denver Auditor´s Office

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