Arizona Overtime and Labor Laws

Minimum Wage Regulations The minimum wage in Arizona is $7.90 per hour as of January 1, 2014, and was previously $7.80 per hour, as of January 1, 2013. The Arizona minimum wage is increased annually based on a cost of living formula. When an employer claims a tip credit, the minimum wage is lowered to $4.80 per hour for employees who customarily and regularly receive tips, so long as the tips plus wages is not less than the minimum wage. The following classes of individuals are not subject to Arizona’s minimum wage:
  • Employees who work for a parent or sibling
  • Employees who provide babysitting services in the employer’s home on a casual basis
  • Employees employed by the government of the United States or by the State of Arizona
Overtime Regulations Arizona follows the Federal law. Employers must pay all non-exempt employees overtime pay of one-and-one-half the employee’s wage rate for all hours worked over 40 in a workweek. Specific Exemptions from the Overtime Requirement If an employee meets an exemption from the overtime requirement, his employer is not required to pay overtime. There are specific criteria to meet each exemption. The most common exemptions to the overtime pay requirements are for:
  • Drivers
  • Farmworkers
  • Partsmen and mechanics
  • Executive employees
  • Administrative employees
  • Professional employees
Holidays / Vacation In Arizona, employers may make their employees work on holidays or weekends without receiving additional pay. Employers are not required to offer vacation, holiday or other pay for time that is not worked. Because these policies are at the discretion of the employer, a “use-it-or-lose-it” vacation policies requiring employees to use vacation days by a set date or lose them is permissible, so long as the employee has a reasonable time to use the vacation. Meal Breaks / Rest Periods Arizona law does not regulate or require employee breaks or lunch periods. However, if breaks are given, employers must follow the Federal requirement that when breaks of 20 minutes or less are given, they must be paid. Meal breaks of 30 minutes or more can be unpaid as long as the employee is relieved of all duties. Jury Duty Employers are not required to pay employees while complying with a jury summons or serving on a jury, but the employees may not be discharged for these reasons. Employers may not require employees to use vacation or sick leave to comply with a jury summons. Further, employees may not lose seniority while serving on a jury. Reporting Time Pay Neither Arizona nor the Federal law requires payment if an employee reports to work expecting to work for a certain number of hours but does not get to work their full schedule. Pay Periods Under Arizona law, all Arizona-based employers must pay their employees at least twice per month, no more than 16 days apart. If a payday falls on a holiday, the employer must pay the employee prior to the scheduled payday. Severance Pay Arizona does not require employers to provide severance pay, but discharged employees must receive all due wages within three working days or by the end of the next pay period, whichever is sooner. Employees who quit must be paid all due wages by the next payday. Deductions Arizona law does not specifically address the types of deductions which can be taken; however pursuant to the FLSA, deductions for items such as uniforms, shortages, damaged goods, or trade tools cannot reduce the employee’s hourly wage below the minimum rate. Statute of Limitations For overtime claims, the statute of limitations is the same as under Federal Law in that claims can be made for the prior 2 years (3 years if the violation is willful). State Law Remedies / Penalties The same Federal law remedies for overtime violations are available in Arizona. Employees can recover all unpaid overtime for two or sometimes three years prior to the filing of a lawsuit. In almost all cases, they are additionally entitled to an award of “liquidated damages” equal to the amount of the unpaid overtime. This means that a successful employee can recover two times the amount of unpaid overtime. A successful plaintiff can also be awarded attorney’s fees and expenses. Questions?

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