Is there a pamphlet with all this information in it? Yes!!
For PDF format, click here : Frequently Asked Questions about Minimum Wage (English) (PDF).
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What is Arizona’s minimum wage?
Effective January 1, 2013, Arizona’s minimum wage is $7.80 per hour. Every employer
covered under the Act is required to pay each employee wages not less than this
amount. Arizona does not provide for a training or sub-minimum wage for different
classes of employees (e.g., young workers, students, etc.). The minimum wage shall
be paid for all hours worked, regardless of the frequency of payment and regardless
of whether the wage is paid on an hourly, salaried, commissioned, piece rate, or
any other basis. For a discussion on the treatment of employees who customarily
receive tips, please see below.
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When will the minimum wage be increased??
The minimum wage is increased annually every successive January 1st by the increase
in the cost of living.
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Do the requirements of the Arizona Minimum Wage Act apply to all employers?
The Arizona Minimum Wage Act applies to all employers except:
- The State of Arizona.
- The United States.
- Small businesses that are not subject to the Federal Fair Labor Standards Act and
which have less than $500,000 in gross annual revenue. This exclusion for small
businesses under the Arizona Minimum Wage Act is very limited. Practically speaking,
most Arizona small businesses will be subject to the Arizona Minimum Wage Act. This
is because most employers, including small businesses, are subject to the Federal
Fair Labor Standards Act (FLSA). Under the Federal Fair Labor Standards Act, coverage
extends in one of two ways: enterprise coverage or individual coverage. Employees
who work for an “enterprise” that is engaged in interstate commerce or the production
of goods for commerce are covered under the FLSA. Likewise, regardless of the volume
of sales of an enterprise (more or less than $500,000), individual employees whose
work affects interstate commerce are covered under the FLSA.
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Are there any exemptions under the Arizona Minimum Wage Act?
Unlike the Federal Fair Labor Standards Act, the Arizona Minimum Wage Act has very
few exemptions. The Arizona Minimum Wage Act applies to any employee employed by
an employer except the following:
- A person who is employed by a parent or a sibling.
- A person who is employed performing babysitting services in the employer’s home
on a casual basis.
- A person employed by the State of Arizona or the United States government.
- A person employed in a small business grossing less than $500,000 in annual revenue,
if that small business is not required to pay minimum wage under the Federal Fair
Labor Standards Act. This exclusion for small businesses under the Arizona Minimum
Wage Act is very limited. Practically speaking, most Arizona small businesses will
be subject to the Arizona Minimum Wage Act. For additional discussion of this exemption,
please see the preceding question.
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Does the Arizona minimum wage apply to part-time or temporary employees?
Yes. The Arizona Minimum Wage Act does not make any distinction between whether
an employee is full-time, part-time, or temporary.
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Does the Arizona minimum wage apply to an independent contractor?
Except for the exemptions described above, the Arizona Minimum Wage Act applies
only to the payment of wages to employees. It does not apply to independent contractors.
You are generally considered to be an employee if you are economically dependent
on the business for which you are performing work. While no one factor or set of
factors is controlling, factors showing this dependence include the degree to which
the work performed is integral to the employer’s business, the degree to which the
employer controls the manner or method in which the work is performed, whether the
employer provides the equipment or material necessary to do your work, the degree
of skill required for the work, and the permanence of the working relationship.
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Does the Arizona minimum wage apply to volunteers?
No. An individual that works for another person without any express or implied compensation
agreement is not an employee under the Arizona Minimum Wage Act. This may include
an individual that volunteers his or her services for civic, charitable, or humanitarian
reasons that are offered freely and without direct or implied pressure or coercion
from an employer, provided that the volunteer is not otherwise employed by the employer
to perform the same type of services as those for which the individual proposes
to volunteer.
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Is the Arizona minimum wage the same for both adult and minor employees?
Yes. There is no distinction made between adults and minors when it comes to payment
of the minimum wage.
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Does an employer have to pay for all hours worked?
Yes. The minimum wage shall be paid for all hours worked regardless of the frequency
of payment and regardless of whether the wage is paid on an hourly, salaried, commissioned,
piece rate, or any other basis. If in any workweek the combined wages of an employee
are less than the applicable minimum wage, the employer shall pay, in addition to
sums already earned, no less than the difference between the amounts earned and
the minimum wage as required under the Arizona Minimum Wage Act.
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What is the Arizona minimum wage for employees who receive tips?
For an employee who customarily and regularly receives tips or gratuities, an employer
may pay a wage up to $3.00 per hour less than the minimum wage. This means that
an employer must pay not less than $4.80 per hour in direct wages for a tipped employee.
If, however, an employee’s tips combined with the employer’s direct wages do not
equal the Arizona minimum hourly wage, then the employer must make up the difference.
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Who is a “tipped” employee?
A tipped employee is an employee who customarily and regularly receives tips, including
the occupation of waiter, waitress, bellhop, busboy, car wash attendant, hairdresser,
barber, valet, and service bartender. The employee must actually receive the tip
free of any control by the employer. The tip must be the property of the employee.
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May employees pool, share, or split tips?
Yes. Employees who customarily and regularly receive tips may pool, share, or split
tips between them. Where employees pool, share, or split tips, the amount actually
retained by each employee is considered the tip of the employee who retained it.
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May employees pool, share or split tips with employees who do not customarily and
regularly receive tips in the occupation in which they work, such as management
or food preparers?
Yes, but the tips received by the employee who does not customarily and regularly
receive tips may not be credited toward that employee’s minimum wage.
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What hours may a “tip credit” be applied towards?
A tip credit is available only for the hours spent in the tipped occupation. Where
a tipped employee is routinely assigned to duties associated with a non-tipped occupation,
such as maintenance or general preparation work, no tip credit may be taken for
the time spent in such duties.
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Is compulsory charge for service a tip?
Only if it is actually distributed by the employer to the employee in the pay period
in which the charge is earned. A compulsory charge for service imposed on a customer
by an employer is not a tip if it is considered part of the employer’s gross receipts
and is not distributed to the employee in the pay period in which the charge is
earned.
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What steps must an employer take to assert a “tip credit”?
If an employer elects to use the tip credit provision, then the employer must:
- Provide written notice to each employee prior to exercising the tip credit.
- Be able to show that the employee received at least the minimum wage when direct
wages and the tip credit are combined.
- Permit the tipped employee to retain all tips, whether or not the employer elects
to take a tip credit for tips received, except to the extent the employee participates
in a valid tip pooling arrangement.
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How does an employer establish that direct wages combined with tips equals or exceeds
the Arizona minimum wage?
In computing the minimum wage, tips are counted in the workweek in which the tip
is earned. For purposes of the Arizona Minimum Wage Act, it is the employer’s responsibility
to maintain a record of the tips considered for purposes of asserting a tip credit.
The amount per hour that the employer takes as a tip credit must be reported to
the employee in writing each workweek.
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What if tips are not sufficient to make up the difference between the employer’s
direct wage obligation and the minimum wage?
The employer must pay the difference.
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What if the employee earns more than the minimum wage after adding the tips received
to the base hourly wage?
The employer has fulfilled its obligation under the Arizona Minimum Wage Act.
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May an employer take a credit against the minimum wage for tools or uniforms?
No. Unless included by a bona fide collective bargaining agreement applicable to
the particular employee, an employer may not credit towards the minimum wage the
cost of any tools, equipment, uniforms, or any other garment worn by an employee
as a condition of employment. This also includes the cleaning or maintenance of
uniforms and tools.
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May a credit for board or lodging be applied against the minimum wage?
No. Unlike other state and federal statutes, the Arizona Minimum Wage Act defines
“wage” to include only “monetary compensation.” Credit for the value of lodging
and other items is not allowed when computing an individual’s entitlement to receive
minimum wages under the Act.
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What can an employee do if an employer is not paying an amount at least equal to
the minimum wage?
An employee has different options if the employee believes that an employer is violating
the requirements of the Arizona Minimum Wage Act. The employee can file an administrative
complaint with the Labor Department of the Industrial Commission of Arizona or file
a civil lawsuit.
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Who can file an administrative complaint and when must it be filed?
Any person or organization may file an administrative complaint with the Labor Department
of the Industrial Commission of Arizona charging that an employer has violated the
Arizona Minimum Wage Act as to any employee or other person. An administrative complaint
must be filed within one year from the date the wages were due.
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Who can file a lawsuit and when must it be filed?
A civil action to enforce the Arizona Minimum Wage Act may be filed by a law enforcement
officer (which means the Attorney General or a city, town, or county attorney) or
by any private party injured by a violation of the Act. The civil action must be
filed no later than two years after a violation last occurs, or three years in the
case of a willful violation. The civil action may include all violations that occurred
as part of a continuing course of employer conduct regardless of the date of the
violation.
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Can an employer retaliate against an employee for asking questions about not being
paid the minimum wage or for asserting any right under the Arizona Minimum Wage
Act?
No. The Arizona Minimum Wage Act prohibits an employer from retaliating against
an employee or other person for asserting any right under the Arizona Minimum Wage
Act. Additionally, if an employer takes adverse action against an employee within
90 days of the employee asserting a right under the Act, the presumption is that
the employer retaliated against the employee. This presumption can only be overcome
if the employer shows by clear and convincing evidence that the action taken against
the employee was for a permissible reason.
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What can an employee do if an employer retaliates against the employee for asserting
a right under the Arizona Minimum Wage Act?
An employee may file an administrative complaint with the Labor Department of the
Industrial Commission of Arizona or file a civil lawsuit.
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What remedies are available to an employee for violations of the Arizona Minimum
Wage?
An employer who fails to pay the minimum wage is required to the pay the employee
the wages owed with interest and an additional amount equal to twice the underpaid
wages. An employer who retaliates against an employee is required to pay penalties
sufficient to compensate the employee and deter future violations, but not less
than $150 for each day that the violation continued or until legal judgment is final.
The Commission and courts also have the authority to order other appropriate legal
or equitable relief for violations of the Act.
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Will the State Labor Department keep an employer’s payroll records confidential?
Payroll information provided to the Labor Department of the Industrial Commission
of Arizona will be kept confidential except as necessary to prosecute violations
under the Act.
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Can an employee’s identity be kept confidential after an administrative complaint
is filed?
The Labor Department of the Industrial Commission of Arizona shall keep the name
of an employee identified in an administrative complaint confidential for as long
as possible. If the Commission determines that an employee’s name must be disclosed
in order to conduct a further investigation, it may do so only with the employee’s
consent.
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What other responsibilities do employers have?
In addition to paying the correct Arizona minimum wage, employers are required to:
- Keep accurate records of employee wages and hours. Most of the information required
to be kept is the type that employers generally maintain in their ordinary business
practice.
- Allow inspection at the worksite of all payroll records by the Labor Department
of the Industrial Commission of Arizona (hereafter, “Department”).
- Furnish copies of payroll records requested by the Department
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- Cooperate with the Department’s investigation into complaints of violation with
the Arizona Minimum Wage Act.
- Allow the Department to interview employees.
- Post the Arizona Minimum Wage Posterin a conspicuous place where employees can read
the poster. This poster is available as a free download from the Department
here. Versions are available in both English and Spanish.
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What kind of records are required?
The records required under the Arizona Minimum Wage Act consist of information that
employers generally maintain in their ordinary business practice, and, in large
part track what is required under the Federal Fair Labor Standards Act. An employer
is required to maintain payroll records showing the hours worked and wages paid,
including basic time and earning cards or sheets, wage rate tables, records of additions
to or deductions from wages paid and any written agreement relied upon to calculate
credits toward the minimum wage. Separate recordkeeping requirements are permitted
for employees on fixed schedules and employees who are compensated on a salary basis
at a rate that exceeds the minimum wage required under the Arizona Minimum Wage
Act and who, under the Federal Fair Labor Standards are an exempt bona fide executive,
administrative, or professional employee, including an employee employed in the
capacity of academic administrative personnel or teachers in elementary or secondary
schools, or in outside sales.
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How long am I required to keep the records?
Four years.
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What happens if an employer violates the recordkeeping, posting, or other requirements
under the Arizona Minimum Wage?
An employer who violates these requirements is subject to a civil penalty of at
least $250 for the first violation and at least $1000 for each subsequent or willful
violation. Special monitoring and inspections may also be imposed. Additionally,
if an employer fails to maintain the required records, it is presumed that the employer
did not pay the required minimum wage. An employer has the right to rebut this presumption
with evidence that the employer paid the employee the required minimum wage.
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How can Arizona’s minimum wage be higher than the federal minimum wage?
Under federal law, a state may require a minimum wage that exceeds the federal wage
as the federal law establishes only the minimum wage that must be paid.
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Which minimum wage law applies?
An employer will likely be subject to both the federal and state minimum wage laws.
When there are different requirements between the laws, the employer must follow
the requirement that is the most beneficial to the employee. Since Arizona’s minimum
wage law requires a higher minimum wage rate than does the federal law, an Arizona
employer who is subject to both laws must pay the Arizona minimum wage rate.
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What is the wage rate that forms the basis for calculation of overtime?
The Arizona minimum wage rate is considered the “regular rate” for purposes of calculating
overtime under the Federal Fair Labor Standards Act.
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May an employee agree to work for less than the minimum wage?
No. The minimum wage is an obligation of the employer and cannot be waived by any
verbal or written agreement or employment contract.
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We encourage you to send your comments and questions regarding State Minimum Wage
to: State Minimum Wage Inquiries
Last Revised 01/02/2013
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