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October 13, 2009

Colo. minimum wage to drop as living costs fall

DENVER (AP) — Colorado officials say the state will become the first to lower its minimum wage because of a falling cost of living.

The state Department of Labor and Employment has ordered the wage to drop to $7.24 from $7.28, effective Jan. 1. But that's lower than the federal minimum wage of $7.25, so minimum wage workers would lose only 3 cents an hour.

Colorado is one of 10 states where the minimum wage is tied to inflation. The indexing is meant to protect low-wage workers from having flat wages as the cost of living goes up. But unlike most of the states, Colorado's provision allows wage declines.

It will be the first decrease in any state since the federal minimum wage law was passed in 1938.

Despite the change, employers are free to leave wages flat.

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