Arizona Payroll Laws: Navigating The Intricacies Of Minimum Wage & Employment Laws

This article will answer the following questions about Arizona payroll laws:

  • Which employees are exempt from Arizona minimum wage?
  • What are the time off and leave laws in Arizona?
  • What are the child labor laws in Arizona?
  • How do overtime laws in Arizona work?

That’s just scratching the surface. We’ll help you navigate the intricacies of minimum wage and employment laws in the state of Arizona through our whistlestop guide.

Disclaimer: Despite our best efforts to provide you with accurate information on this topic at the time of writing, we cannot guarantee the accuracy of the content at the time of reading. This blog post is for informational purposes only and should not be considered legal advice. Consult an attorney for specific guidance on Arizona payroll laws.

In the United States, employment laws and payroll regulations can be complex, particularly as they differ between states. Understanding Arizona payroll laws is essential for employers and employees alike to ensure compliance and fair wages. This whistlestop guide delves into the intricacies of Arizona labor laws, minimum wage, exemptions, and other payroll regulations.

Arizona Minimum Wage (Tipped Employees & Exemptions)

As of January 1, 2024, the Arizona minimum wage is set at $14.35 per hour.

This is higher than the federal minimum wage of $7.25 per hour, and employers in Arizona must comply with the state minimum wage. The Arizona minimum wage is adjusted annually based on the cost of living, as covered in the Arizona Revised Statutes (A.R.S.)

Tipped Employees (What Are The Laws?)

For tipped employees, Arizona law allows employers to pay a cash wage of $3.00 per hour, provided that the employee’s wages, including tips, meet or exceed the state minimum wage. If the combined wages and tips do not meet the minimum wage, the employer is required to make up the difference.

Exemptions (Which Employees Are Exempt?)

When it comes to Arizona minimum wage laws, certain employees are exempt, such as:

  • Casual babysitters
  • Employees at small businesses with annual gross revenues below $500,000
  • Workers employed in a family business where the employee is related to the employer

However, even if an employee is exempt under state law, they may still be subject to federal minimum wage requirements under the Fair Labor Standards Act (FLSA). Employers should consult both state and federal laws to ensure compliance with minimum wage regulations.

Overtime Laws In Arizona (How Does It Work?)

Arizona follows the federal overtime laws established by the FLSA. Non-exempt employees are entitled to overtime pay of one and a half times their regular wage rate for any hours worked beyond 40 in a single workweek. It is essential for employers to accurately track the number of hours worked by non-exempt employees to ensure they receive proper overtime compensation.

Arizona Wage & Hour Laws (Pay Periods, Payday, & Recordkeeping)

Arizona has specific wage and hour laws that employers must adhere to, including rules about pay periods, payday, and recordkeeping.

Pay Periods & Payday

Arizona law requires employers to designate two or more days in each month as regular paydays, not more than 16 days apart, per A.R.S. § 23-351. Employers must pay employees within five days of the scheduled payday. If an employee is absent on payday, they must be paid on the next business day.


Employers in Arizona are required to keep accurate records of employee wages, hours worked, and other essential information, as outlined by the Department of Economic Security. Proper recordkeeping ensures compliance with both state and federal laws and helps avoid potential disputes or penalties.

Arizona Paid Sick Leave

Under the Arizona Fair Wages and Healthy Families Act, employers are required to provide paid sick leave to their employees. The amount of paid sick leave an employee can accrue depends on the size of the employer:

  • Employers with 15 or more employees must provide a minimum of 40 hours of paid sick leave per year.
  • Employers with fewer than 15 employees must provide a minimum of 24 hours of paid sick leave per year.

Employees can use accrued sick time for various reasons, such as illness, medical appointments, or even caring for a family member. It is critically important for employers to maintain accurate records of employees’ paid sick leave and notify employees of their available sick time.

Teams can maintain accurate records of employee paid sick leave through timekeeping platforms like Buddy Punch. With Buddy Punch in your corner, you can centralize all employee data and keep everything under one roof.

Time Off & Leave Laws in Arizona

Like many other states, Arizona has specific laws regarding various types of employee leave, including jury duty, family and medical leave, and military leave.

Jury Duty (What Are The Laws?)

Under Arizona law (A.R.S. § 21-236), employers must provide unpaid time off for employees serving on jury duty. Employers cannot terminate, threaten, or coerce an employee for taking time off to serve on a jury.

Family Medical Leave (How Does It Work?)

Arizona follows the federal Family and Medical Leave Act (FMLA) – which provides eligible employees with up to 12 weeks of unpaid, job-protected leave per year for qualifying reasons such as personal illness, caregiving, or the birth or adoption of a child.

The Department of Labor administers the FMLA and offers resources to employers and employees – so they have a clear understanding of their rights and responsibilities under the law.

Military Leave

The Uniformed Services Employment and Reemployment Rights Act (USERRA) protects employees who serve in the military. This is achieved by requiring employers to provide unpaid leave for military service and reemployment rights upon the employee’s return. Employers must also provide benefits and protection against discrimination based on military service.

Child Labor Laws In Arizona

Arizona has specific child labor laws that regulate the employment of minors. These laws aim to protect the health, safety, and education of minors while allowing them to gain work experience.

Work Hour Restrictions For Minors

Work hour restrictions for minors in Arizona depend on the minor’s age:

  • Minors under 16 years old may not work more than 3 hours on a school day. This is 8 hours on a non-school day or 18 hours in a school week.
  • Minors aged 16 or 17 may not work more than 8 hours in a day, 40 hours in a week, or during hours when school is in session.

Prohibited Occupations (Which Minors Are Prohibited?)

Arizona law prohibits minors from working in certain hazardous occupations, such as mining, manufacturing, or operating heavy machinery. Employers must ensure that they do not employ minors in prohibited occupations, as outlined by the Industrial Commission of Arizona.

Arizona Employment Laws (Discrimination & Harassment)

Arizona law prohibits discrimination and harassment in employment based on race, color, religion, sex, national origin, age, disability, and genetic information. When it comes to discrimination and harassment, employers must ensure that their workplace is free from these issues and that they address any complaints promptly and thoroughly.

Collective Bargaining Agreements (How Should Employers Respond?)

In the state of Arizona, public employees have the right to engage in collective bargaining to negotiate wages, hours, and working conditions. Employers must respect these agreements and comply with their provisions to maintain a harmonious workplace.

Arizona Payroll Laws (Pay Equity & Fair Treatment)

Ensuring pay equity and fair treatment in the workplace is a critical aspect of Arizona payroll laws. Employers must be aware of their obligations under both state and federal law to provide equitable wages and equal opportunities for all employees, regardless of their gender, race, national origin, or other protected characteristics.

Pay Equity (What Are The Laws?)

Arizona law prohibits pay discrimination based on sex. Employers must ensure that employees performing substantially similar work are paid equitably, regardless of their gender. Pay disparities must be justified by factors such as seniority, merit, or job-related qualifications.

Fair Treatment (How Does It Work?)

Alongside pay equity, employers in Arizona must ensure that their workplace policies and practices do not discriminate against employees based on protected characteristics, such as race, national origin, age, or disability. Employers should regularly review their policies and practices to identify and address any potential issues of discrimination or unfair treatment.

Employers can create a more inclusive and harmonious work environment by ensuring pay equity and fair treatment in the workplace. Ultimately, this benefits all employees and promotes compliance with Arizona labor laws and federal regulations.

Payment Of Wages & Wage Claims In Arizona

Arizona law has specific provisions regarding the payment of wages, wage claims, and the protection of employees from wage theft. Here’s how it works:

Deductions From Wages

Employers in Arizona can deduct from an employee’s wages only for reasons specified under the law, such as taxes, court-ordered garnishments, or employee-authorized deductions. For instance, insurance premiums or retirement contributions. Employers cannot make deductions for cash shortages, damaged property, or lost items without the employee’s express written consent.

Wage Claims

If an employee believes that their employer has not paid them the wages they are owed, they can file a wage claim with the Industrial Commission of Arizona. The Commission will investigate the claim and may order the employer to pay any unpaid wages, penalties, or interest.

Part-Time & Temporary Employees In Arizona

Part-time and temporary employees in Arizona have many of the same rights and protections as full-time employees, including minimum wage, overtime pay, and paid sick leave.

Employers should ensure that part-time and temporary employees receive fair treatment and are fully informed of their rights under Arizona law.

Pay Equity In Arizona

Arizona law prohibits pay discrimination based on sex. Employers must ensure that employees performing substantially similar work are paid equitably, regardless of their gender. Pay disparities must be justified by factors such as seniority, merit, or job-related qualifications.

Meal & Rest Breaks In Arizona

Arizona does not have specific state laws requiring meal or rest breaks for adult employees. However, employers must follow federal regulations under the FLSA, which require that any break lasting 20 minutes or less be considered paid time. While meal breaks are not required by law, if an employer provides a break lasting 30 minutes or more, it can be unpaid as long as the employee is completely relieved of their duties during the break.

Employee Classification & Independent Contractors

Properly classifying workers as employees or independent contractors is crucial for compliance with Arizona labor laws and federal regulations. Misclassification can lead to significant penalties and back pay for employers.

Employee Classification

Employees are generally entitled to minimum wage, overtime pay, workers’ compensation, and other protections under Arizona and federal law. Employers should consider factors such as the degree of control they have over the worker, the worker’s level of independence, and the nature of the work when determining employee classification.

Independent Contractors

Independent contractors are not entitled to the same protections as employees, such as minimum wage, overtime pay, or workers’ compensation. However, employers must ensure that they are not misclassifying workers as independent contractors to avoid providing employee benefits and protections.

Workplace Safety & Health Regulations (For Employers In Arizona)

Employers in Arizona must comply with both state and federal workplace safety and health regulations to protect their employees from hazards and maintain a safe work environment.

Arizona Division Of Occupational Safety & Health (ADOSH)

ADOSH is responsible for enforcing workplace safety and health regulations in Arizona. Employers must comply with ADOSH standards, which can include maintaining a safe work environment, providing necessary safety equipment, and training employees on safety procedures.

Federal Occupational Safety & Health Administration (OSHA)

As well as complying with ADOSH regulations, Arizona employers must also adhere to federal OSHA standards. OSHA enforces workplace safety and health regulations across various industries, ensuring that employers maintain a safe work environment and protect employees from hazards.

Small Business Considerations

Small businesses in Arizona must comply with the same labor laws as larger companies, although some exemptions or reduced requirements may apply. It is crucial for small business owners to understand their obligations under Arizona labor laws and federal regulations to maintain a compliant and fair workplace.

Posting Requirements

Arizona employers are required to post certain notices in the workplace to inform employees of their rights and responsibilities under labor laws. These notices include information on minimum wage, paid sick leave, child labor laws, and workplace safety regulations. Employers must ensure that these notices are posted in a conspicuous location accessible to all employees.

Annual Cost of Living Adjustments

Arizona’s minimum wage is subject to annual cost of living adjustments, which are based on the Consumer Price Index (CPI). The Industrial Commission of Arizona calculates the new minimum wage rate each year and announces it by October 15th, with the adjusted rate taking effect on January 1st of the following year.

Arizona Payroll Laws (Resources For Employers & Employees)

Several resources are available to employers and employees in Arizona to assist in understanding and complying with labor laws and regulations:

Industrial Commission of Arizona

The Industrial Commission is responsible for enforcing labor laws in Arizona, including minimum wage, paid sick leave, and workers’ compensation. Their website provides valuable information, resources, and forms for employers and employees.

Arizona Department of Economic Security

The Department of Economic Security administers unemployment insurance, workforce development, and other programs to support Arizona workers and employers. Their website offers information on various labor laws and resources for employers and employees alike.

U.S. Department of Labor

The federal Department of Labor enforces labor laws and regulations at the national level. Their website provides a wealth of information and resources on various topics, including wage and hour laws, workplace safety, and family and medical leave.

Local Labor & Employment Law Attorneys

Consulting with a labor and employment law attorney can provide valuable legal advice and guidance for employers and employees navigating the complexities of Arizona labor laws and federal regulations.

Legal Disclaimer & Advice

The information provided in this blog post is intended for informational purposes only and does not constitute legal advice. Laws and regulations may change over time, and each employer’s situation may be unique. Employers and employees should consult with an attorney or a qualified professional for specific guidance regarding their rights and obligations under Arizona labor laws and federal regulations.

Importance of Staying Informed and Proactive

Employers should take proactive steps to ensure compliance with Arizona and federal labor laws, such as implementing training and compliance programs, keeping accurate records, and staying informed about changes in legislation or regulations.

Employees must also be aware of their rights and responsibilities under the law to advocate for themselves and ensure they receive fair treatment in the workplace.

Through working together and staying informed, employers and employees in Arizona can create a thriving, harmonious workplace that benefits everyone involved.

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