A series of new labor and regulatory laws affecting restaurants in Colorado will take effect starting January 1, 2026. These changes include adjustments to minimum wage rates, expanded enforcement for wage violations, new disclosure requirements for service fees, increased inspection fees, food truck licensing reforms, restrictions on price increases during emergencies, and higher penalties for disability discrimination.
One significant change is the implementation of local minimum wages. Edgewater is expected to become the first city to use a new state law that allows local governments to increase their tip credit if they set a higher minimum wage than the state’s. If Edgewater’s ordinance passes as planned on January 1, its tip credit will rise to $4.67 per hour. This means that while the city’s minimum wage will be $18.17 in 2026, the tipped minimum wage will remain at $13.50 per hour.
The state’s existing $3.02 tip credit is protected under HB25-1208, but local authorities now have more flexibility if they raise their own minimum wages above the state’s rate.
HB25-1001 expands enforcement measures for wage and hour compliance by increasing penalties for noncompliance and broadening the definition of “employer.” State and local agencies will have greater authority to investigate complaints about wages and worker misclassification.
Under HB25-1090, mandatory service fees can continue at all food and beverage establishments without affecting menu prices. However, these fees must be clearly disclosed with an explanation of how they are used so customers can easily understand them. “Service fees must be disclosed with an accurate description of their purpose in a clearly visible place for customers to see, such as on signage at the cash register or on menus and receipts,” according to guidance from the Colorado Restaurant Association (CRA). The Attorney General’s office is expected to finalize rules regarding this law in 2026.
Food establishment inspection license fees will increase over three years due to SB25-285: by 25% in 2026, then by another 20% in both 2027 and 2028.
HB25-1295 introduces a streamlined licensing system for food trucks operating across different cities and counties within Colorado. While this simplifies operations across jurisdictions, food trucks still need proper fire and food safety permits.
During declared emergencies, HB25-1010 prohibits restaurants from raising prices on essential goods or services by more than 10% above their average price during the previous 90 days unless justified by increased costs.
HB25-1239 raises fines for disability-related discrimination from $3,500 to $5,000 per violation but does not alter what constitutes discrimination under state law.
Colorado plans to apply for participation in the Restaurant Meals Program (RMP) through SB25-169 on January 1, 2026. If approved by USDA, eligible SNAP recipients could buy hot prepared meals at participating restaurants; however, no timeline has been set for implementation.
For restaurant operators seeking clarification or assistance regarding these updates, CRA members are reminded that they have access to free monthly legal consultations via info@corestaurant.org.
