Arizona Labor Law Guide

What’s new in 2024

• The minimum wage increases to $14.35 per hour

Federal law posters

State law posters

Wage and Hour Laws

Minimum Wage

From January 1, 2024, Arizona’s minimum wage is $14.35 per hour. 

The state’s minimum wage law applies to all employees except:

• Workers employed by a parent or sibling.
• Casual babysitters.
• State or federal government employees.
• Workers in businesses with gross revenues of less than $500,000 and exempt from federal minimum wage provisions under the federal Fair Labor Standards Act (FLSA). 

Arizona’s minimum wage increases each year based on the cost of living. 

The minimum wage for the city of Flagstaff is $17.40 per hour. 

Tipped Minimum Wage

Employers can pay tipped employees $3.00 less per hour than the minimum wage. This means Arizona’s tipped minimum wage is currently $11.35 per hour. 

Employers can pay tipped employees $11.35 only if their combined wages and tips add up to at least the minimum wage ($14.35).  

Overtime Laws

There are no state-based overtime laws in Arizona that apply to private employees. Instead, the federal Fair Labor Standards Act (FLSA) overtime provisions apply to most employers. 

Under the FLSA, covered employers must pay non-exempt employees 1.5 times their regular hourly rate for any hours over 40 in a work week. 

Employees exempt from the FLSA include:

• Those in executive, administrative, and professional roles. 
• Computer professionals earning at least $27.63 an hour. 
• Outside salespersons. 
• Certain commissioned sales employees. 

Meal and Rest Breaks

There are no state laws requiring minimum meal or rest breaks for Arizona employees. 

Where an employer chooses to offer breaks, federal law applies. Employers must pay employees for breaks of less than 20 minutes. They don’t have to pay employees for breaks longer than 20 minutes if the employee doesn’t perform any work duties during that time. 

Payday Frequency and Method

Employers must pay employees on at least 2 fixed days a month. These days can’t be more than 16 days apart. 

The only exception is certain employees whose employers’ main places of business and payroll systems are located outside of Arizona. 

The employer must pay employees in advance if a payday falls on a weekend or holiday. They can pay wages in cash, bank checks, bank deposit (with the employee’s consent), or payroll card (under certain conditions). 

Wage Deductions and Garnishments

Employers can deduct or withhold amounts from employees’ wages only in cases where:

• They’re required by state or federal law. 
• The employee has provided written authorization. 
• There’s a reasonable good-faith dispute concerning the wage amount due. 

If an employer unlawfully deducts an employee’s wages, the employee can file a complaint with the Industrial Commission of Arizona (ICA) or start a civil action in court. 

In Arizona, weekly wage garnishments under a court judgment are capped at 10% of an employee’s disposable earnings or the amount at which their disposable earnings exceed 60 times the minimum wage—whichever is less. 

Child support garnishments are capped at 50% of an employee’s disposable earnings. Federal garnishment limits apply to student loans and unpaid taxes. 

Recordkeeping

Arizona law requires employers to keep payroll records for 4 years. These records include each employee’s:

• Hours worked each day. 
• Wages. 
• Earned sick time paid.

The ICA can waive these recordkeeping requirements for small businesses. Employers who fail to maintain the necessary records may face fines of a minimum of $250 plus $1,000 for subsequent violations. 

Employee Compensation and Benefits

Final Paycheck Laws

Employers who have terminated an employee must pay their former employee any wages they owe them within 7 working days of their end date or the next regular payday, whichever is sooner. 

Employees who quit must receive pay by their next regular paydays. Employers who fail to do this can be charged and fined up to $300. 

Reporting Time Pay

Arizona doesn’t have any reporting time pay laws. This means employers don’t have to compensate employees for attending a shift but not working. Employees who work part of a shift must be paid for the time they worked only.

Paystub Requirements

Employers must provide employees with a statement for each pay period detailing their pay information. 

Employee Scheduling Laws

Arizona doesn’t have any predictive scheduling laws or advance notice requirements. State law prohibits cities or counties from implementing employee scheduling laws for private employers. 

Workers’ Compensation

All Arizona employers are required to provide employees with workers’ compensation coverage. Some limited exceptions exist. For example, employers don’t need to provide independent contractors and domestic workers employed in private homes with coverage. 

The cost of workers’ compensation is the employer’s responsibility. It can’t be deducted from employees’ wages.  

Arizona’s workers’ compensation system is “no-fault.” This means an employee receives compensation regardless of who caused the incident. 

Workers’ compensation covers 3 types of claims:

• Medical expenses, including doctor’s visits, medical devices, and medications. 
• Time loss to cover temporary lost wages where an employee loses their earnings for more than 7 days due to workplace illness or injury. 
• Permanent impairment. 

In the event of a workplace injury or illness, employers must send a form 101 – Employers’ Report of Injury to the ICA and insurer within 10 days. 

Injured employees have 1 year to file a claim with the ICA. They must submit the claim in writing, by either completing a Worker’s and Physician’s Report of Injury or a Worker’s Report of Injury form. 

Where a worker’s compensation dispute arises or an insurer denies an employee’s compensation claim, the worker can request a hearing before the ICA.

Unemployment Insurance

Under state law, most employers in Arizona must pay unemployment insurance taxes on the first $8,000 wages paid to each employee. Some types of employment are exempt from unemployment tax, including:

• Licensed real estate and insurance salespersons paid only by commission. 
• Employees under 21 years employed by a parent. 
• Students who deliver services as part of work experience programs. 

An employer’s tax rates are calculated based on various factors, such as the tax amount they’ve paid and their average annual taxable payroll. Employers can report wages and pay unemployment tax via the Arizona Department of Economic Security’s website. 

These taxes fund unemployment benefits for employees who have lost their jobs through no fault of their own. To be eligible for unemployment benefits, an individual must:

• Be unemployed through no fault of their own
• Be able to work
• Continue to seek employment
• Meet certain wage requirements

The weekly unemployment benefits an employee receives depend on their previous wages. Currently, these benefits are calculated as 4% of the wages they received in the highest quarter of their base period, up to $320. 

The maximum number of weeks an employee can claim unemployment benefits is 26. However, if the state’s unemployment rate falls below 5%, this reduces to 24 weeks. 

Individuals can apply for unemployment benefits online through the Arizona Department of Economic Security. They must provide certain information as part of their application, including their Social Security Number and employment history for the last 18 months. 

Workplace Rights and Protections

Discrimination and Harassment

In addition to federal anti-discrimination laws, under the Arizona Civil Rights Act, employers with 15 or more employees can’t discriminate against applicants or employees based on the following:

• Race.
• Color.
• National origin.
• Sex.
• Religion.
• Age (40 years and over).
• Disability (mental and physical).

All employees are protected against sexual harassment, regardless of employer size. 

State law also prohibits employers from retaliating against employees who exercise their rights under anti-discrimination law—for example, by filing a discrimination complaint. 

Job applicants or employees who believe they’ve been discriminated against can file a complaint with the Civil Rights Division (CRD) of the Attorney General’s Office. They can do this via the CRD’s website or by mail. They must file complaints within 180 days of the alleged discriminatory conduct. 

Employment discrimination complaints may be resolved through voluntary mediation. If the matter can’t be resolved through mediation, the CRD investigates the complaint and makes a determination (finding evidence of discrimination) or dismisses the complaint. 

If their complaint is dismissed, an applicant or employee can file a discrimination lawsuit.

If the CRD makes a determination, it will put the parties through a process called conciliation so they can attempt to resolve the issue. If conciliation is unsuccessful, the CRD can file a discrimination lawsuit against the employer. 

Leave Laws

𐄂 Family and Medical Leave	Arizona has no specific family and medical leave law, although employers must provide paid sick leave (see the section below).  The federal Family and Medical Leave Act (FMLA) applies to Arizona employers with 50 or more employees. It requires them to provide eligible employees with up to 12 weeks of unpaid, job-protected leave for their own or a family member’s health issues.
✔ Paid Sick Leave	The Arizona Healthy Families and Fair Wages Act requires most private employers to provide paid sick leave to employees. Sick leave accrues at 1 hour for every 30 hours an employee works.  The maximum amount of paid sick leave employees can accrue depends on the business’s size. For companies with less than 15 employees, it’s capped at 24 hours per year. For companies with 15 or more employees, it’s capped at 40 hours per year. Employers can also set their own higher caps.  Employees can use paid sick leave:For their medical care, including treatment and prevention of mental and physical issues. To care for a sick spouse, partner, child, grandchild, parent, grandparent, or sibling. For isolation or quarantine required under a public health emergency or because of exposure to an infectious disease. To take time off in relation to domestic violence, abuse, sexual assault, or stalking.  Employers can ask employees for documentation to support requests for 3 or more consecutive paid sick leave days. They can also limit employees to using paid sick leave until after 90 calendar days of their start dates.  Employees’ accrued sick leave must roll over to the following year. Employers don’t have to pay out employees for accrued, unused paid sick leave when the employment relationship ends.
𐄂 Paid Family Leave	There is no Arizona law requiring employers to provide paid family leave.  Eligible employees may be able to access unpaid family leave under the federal FMLA.
𐄂 Pregnancy and Parental Leave	Private employees don’t have specific pregnancy or parental leave entitlements in Arizona.  Eligible employees may be able to access unpaid pregnancy and parental leave under the federal FMLA.
𐄂 Vacation and Personal Leave	Arizona employers aren’t required to provide vacation or personal leave. However, many employers choose to do so. Where they do, the leave should comply with relevant policies, employment contracts, or collective bargaining agreements.  Employers can cap vacation leave accruals and apply a “use-it-or-lose it” policy, requiring employees to use their vacation time within specified timeframes.  Whether employers must pay out employees for any accrued, unused paid vacation leave on their separation depends on the terms of their employment contracts.

Military, Jury Duty, and Other Mandatory Leave

There are several other types of mandatory leave in Arizona.

Military Leave	Under state law, employers can’t refuse service-related leave for employees who are members of the Arizona National Guard or US armed forces.  Returning service member employees have the right to be reinstated to their previous or higher positions. Employers can’t discriminate against employees who are members of the armed services.
Jury Duty Leave	Employers can’t penalize employees for taking leave to attend jury duty. They also can’t require them to use accrued annual, vacation, or sick leave to serve on juries. Jury duty leave doesn’t have to be paid.  State law prohibits employers from retaliating against an employee for serving as a juror—for example, by demoting them.
Crime Victims Leave	Employers with 50 or more employees must provide unpaid leave to employees who are victims of crime to attend related court proceedings. Employers can require employees to use accrued paid vacation, personal, or sick leave for this purpose instead. To access this leave, employees must provide the employer with the relevant documentation from the law enforcement agency.  Employers can restrict the duration of this leave—but only in cases where granting the employee crime victims leave causes the business undue hardship.
Voting Leave	State law requires Arizona employers to offer employees up to 3 hours of paid voting leave.  The requirement for paid voting leave applies only in cases where the time between the polls opening and closing and the start and end of the employees’ shift is less than 3 consecutive hours. For example, if the polls are open from 8am to 7pm and an employee works from 9am to 6pm, their employer could give them 2 hours of paid leave at the start or end of their shift to ensure they have 3 consecutive hours to vote. To access voting leave, employees must provide 1 day of notice.

Child Labor Laws

There’s no minimum work age in Arizona. However, children under 10 can’t work as newspaper carriers. 

Instead, the federal minimum work age of 14 applies. Federal restrictions on working hours also apply to workers under 16 (see the below table for further details). 

Minors under 18 don’t need a work permit in Arizona. 

Employers who break Arizona’s youth employment laws can face fines of up to $1,000 and misdemeanor charges. 

	14 and 15-year-olds	16 and 17-year-olds
When school is in session	Up to 3 hours a day, up to a maximum of 18 hours a weekCan’t work before 7am or after 7pm	No limits
When school isn’t in session	Up to 8 hours a day, up to a maximum of 40 hours a weekCan’t work before 7am or after 7pm (9pm from June 1 until Labor Day)
Limits on types of work	In addition to the types of prohibited occupations for those under 18, employees under 16 can’t engage in various kinds of work, including:ManufacturingConstructionAgricultureWorking from a ladder, scaffold, or windowsill A complete list of prohibited occupations for workers under 16 is available here.	Employees under 18 can’t engage in various types of work, including:The manufacture or storage of explosivesMotor vehicle driverWork involving power-driven woodworking machines, hoists, or saws Slaughtering and meat packing A complete list of prohibited occupations is available here.
There are some exceptions to these prohibited types of employment, including for minors who:Are employed by their parents or other relatives who own a minimum of 10% of the company and are involved in day-to-day operations.Are working as registered apprentices. Have a high school diploma or equivalent.

Workplace Safety and Health

Arizona has a state plan under the Arizona Occupational Safety and Health Act (AOSHA) approved by the federal Occupational Safety and Health Administration (OSHA). This plan applies to most private employers, with some limited exceptions, and is administered by the Arizona Division of Occupational Safety and Health (ADOSH).  

As a result, ADOSH enforces the same standards as those under the federal Occupational Safety and Health Administration Act and several additional state-specific standards. 

Under the AOSHA, employers must provide employees with a workplace free from hazards that cause or could cause death or serious injury to employees. 

Employers must also report any workplace fatalities or serious injury to ADOSH. Employers must report fatalities within 8 hours and serious injuries resulting in in-patient hospitalization, amputation, or loss of an eye within 24 hours. They can make these reports by phone or online. 

Employees must follow all occupational safety and health standards, rules, and regulations. These include:

• Using personal protective equipment as required by their employer. 
• Immediately reporting any workplace injuries to their employer. 
• Reporting any hazards to their employer. 

Employees also have certain rights, including the right to:

• File a complaint with ADOSH regarding unsafe working conditions. 
• File a complaint concerning employer discrimination due to engaging in activities protected by ADOSH (employees must do so within 30 days of the alleged discrimination). 
• Obtain their medical records or records relating to their exposure to harmful substances in the workplace. 
• See any citations issued to their employer for violations of the AOSHA.

ADOSH has the power to investigate workplace safety and health complaints. ADOSH also regularly conducts unannounced workplace inspections. Where there’s reasonable cause to believe a violation occurred, ADOSH issues a citation to the employer, requiring them to address it. Employers receiving a citation from ADOSH must post a copy in the workplace. 

Employers can also face civil penalties for AOSHA violations. 

Labor Union Regulations

Arizona is a right-to-work state. This means employers can’t require employees to join a union or pay union membership fees as a condition of employment. 

The federal National Labor Relations Act (NLRA) applies to most private sector employees, protecting their right to participate (or not participate) in collective bargaining. 

Employment Contracts and Severance

Employment Contract Laws

The Employment Protection Act (EPA) states that employment in Arizona is at-will unless the employer explicitly states otherwise in a written and signed employment contract, employment handbook, or other documented form. 

Under the EPA, private employees can sue for wrongful termination only based on:

• Breach of an employment contract
• Violation of public policy
• Retaliation for exercising specific rights, such as taking time off for voting or jury service

Employees have 1 year to file a lawsuit relating to wrongful termination or breach of an employment contract. 

Non-compete and non-solicitation agreements are legal in Arizona. These agreements generally need to be reasonable in scope, length of time, and geography to be enforceable. They must also be designed to protect a business’s legitimate and protectable business interests. 

Severance Pay

Employers aren’t required to provide severance pay in Arizona.

Additional Laws That Might Apply to You

Workplace drug and alcohol testing	Employers can ask candidates and employees to submit to drug or alcohol testing as a condition of employment. They can do so only if they have a written policy that has been given to employees. There are various items employers must include in a drug and alcohol testing policy, including:Which employees may be subject to testing. When testing may be required. Which testing and collection procedures are used. What happens if an employee refuses to be tested. Steps that may be taken if an employee tests positive.  Employers can use a positive test to suspend or terminate an employee and reject a job candidate’s application.
Smoke-free workplaces	Smoking is prohibited in all Arizona workplaces. Employers must inform all job applicants and employees of this and place “no smoking” signs at workplace entrances.
Mini-COBRA	Federal law ensures employees have the right to certain health benefits for some time after their employment ends. However, this federal law applies to businesses with 20 or more employees only.  Arizona has a mini-COBRA law that applies to employers with 2 to 50 employees, ensuring their employees’ health benefits continue for up to 18 months following certain qualifying events, including job loss.

COVID-19 Related Laws and Regulations

Most, if not all, of the COVID-19 executive orders issued by Arizona’s governor relating to employment have now been rescinded. 

Navigating Legal Issues and Resources

For further information on Arizona’s labor laws, the relevant government departments provide a useful starting point:

• Labor Department of the Industrial Commission of Arizona for issues such as wages,  hours, leave, and youth employment.
• Civil Rights Division of the Arizona Attorney General’s Office for matters relating to employment discrimination.

There are several sources of free employment law advice in Arizona, including:

• The American Bar Association’s Free Legal Answers website. 
• AZ Legal Help, run by the Arizona Bar Foundation. 
• Arizona Legal Center. 

Disclaimer

The information presented on this website about labor laws in Arizona is a summary for informational purposes only and is not intended as legal advice. However, laws and regulations regularly change and may vary depending on individual circumstances. While we have made every effort to ensure the information provided is up to date and reliable, we cannot guarantee its completeness, accuracy, or applicability to your specific situation. Therefore, we strongly recommend that readers seek guidance from their legal department or a qualified attorney to ensure compliance with applicable laws and regulations. Please note that we cannot be held liable for any actions taken or not taken based on the information presented on this website.