AZ · state labor law, 2026
Arizona labor laws: minimum wage, overtime, leave, final pay and breaks
Arizona combines an inflation-indexed state wage, a mountain city that outpays it by several dollars and one of the smallest tip credits in the country.
Arizona and federal rules checked on official sources on · Checked by Radif Partners · How we calculate
- Minimum wage now
- $15.15/h
- statewide
- From January 1, 2027
- $15.65/h
- announced rate
- Tipped cash wage
- $12.15/h
- tips must make up the rest
- Overtime
- 40 h/week
- federal FLSA rule
- Paid sick leave
- 1 h per 30 h
- cap 40 h a year
- Paid family leave
- no program
- FMLA is unpaid
Arizona's minimum wage is $15.15 an hour in 2026 and rises to $15.65 on January 1, 2027, the yearly cost-of-living step that voters wrote into the Fair Wages and Healthy Families Act. Two cities go higher: Flagstaff pays $18.35, with no tip credit at all, and Tucson $15.45 inside city limits. Elsewhere, an employer may pay tipped staff $12.15, which means the tip credit can never exceed $3.00 an hour. The same law gives every worker earned paid sick time at one hour per 30 hours worked, up to 40 hours a year at businesses with 15 or more employees and 24 hours at smaller ones. Arizona has no overtime statute for private employers, so the federal rule of time and a half after 40 hours a week applies, and the state requires no meal or rest breaks for adults. It is a right-to-work state, and a fired worker must be paid within seven working days.
Gross pay for this week in Arizona
$606
Time and a half after 40 hours in a week (federal rule)
| Minimum wage in Arizona now | $15.15 an hour |
| Your rate against it | At or above the minimum |
| Overtime: none this week | $0 |
| Paid sick leave earned in a year | 40 hours (cap reached) |
| Breaks owed in a 8-hour shift | None required for adults |
| Final paycheck if fired | within 7 working days or by the end of the next regular pay period, whichever is sooner |
| Unused vacation at the end | Paid out if the employer policy or contract says so |
| Paid family leave | No state program |
40 hours a week at $15.15. State rule applied. Minimum wage, overtime and leave rules have exceptions by employer size and industry. How this is calculated.
Flagstaff, where tips cannot reduce the wage
Two Arizona cities run their own wage ordinances, Flagstaff and Tucson. Flagstaff's is the more striking: $18.35 an hour since January 1, 2026, rising to $18.95 in January 2027, and every employee, tipped or not, must receive the full rate before gratuities. A full-time line cook in Flagstaff earns $6,656 more a year than a cook paid the state minimum in Phoenix. Tucson's $15.45 is closer to the state figure and allows the same tip credit as state law, adjusted every year by the consumer price index. Tucson's rate applies within city limits, so an employer based in Marana or Oro Valley pays the state figure.
City minimum wage against the state rate
Flagstaff (AZ), per hour
$18.35
| Arizona state rate | $15.15 |
| Difference per hour | $3.20 |
| Difference over a year | $6,656 |
| Year at the city rate | $38,168 |
A tip credit capped at $3.00
Federal law lets an employer count up to $5.12 of tips toward the wage. Arizona allows only $3.00, so a server in Mesa or Scottsdale gets at least $12.15 in cash per hour, and tips must carry the total to $15.15. A bartender with $2.50 an hour in tips is short by $0.50 an hour, which the employer has to make up. The calculator below runs your own numbers.
Do your tips cover the minimum wage?
Employer top-up owed per hour
$0.00
| Cash wage | $12.15 |
| Cash wage + tips | $16.15 |
| Minimum wage in Arizona | $15.15 |
| Top-up over a 30-hour week | $0 |
Earned sick time by business size
Proposition 206, approved by voters in 2016, put a paid sick leave mandate into the same law as the wage. A full-time worker accrues about 40 hours over a year at one hour per 30, but a business with 15 or more employees may cap use at 40 hours and a smaller one at 24, unless it chooses a higher limit. Sick leave laws in other states vary on the same points.
Hours and breaks follow federal rules
Title 23 of the Arizona statutes deals with wage amounts and payment timing but says nothing on overtime for the private sector. The FLSA therefore decides. A warehouse picker on $18 an hour working six 8-hour days reaches 48 hours, and the federal method pays 8 of them at time and a half, $936 for the week. There is no daily overtime and no state salary test above the federal $684 a week. Lunch and rest periods are left to the employer for adults, so a policy offering them can also take them away.
The last paycheck and vacation
When an employer discharges a worker, wages are due within seven working days or by the end of the next regular pay period, whichever comes first. A worker who resigns is paid on the regular payday for the period in which the job ended. Arizona has no rule forcing payout of unused vacation; it becomes owed only when a policy or contract gives the employee a reasonable expectation of being paid. The Industrial Commission of Arizona's Labor Department takes wage claims, and it decides each one on the evidence.
Arizona employment rules at a glance, 2026
Minimum wage schedule
| From | Who it covers | Rate | Note |
|---|---|---|---|
| January 1, 2026 | Statewide | $15.15 | annual cost-of-living adjustment under A.R.S. 23-363(B) |
| January 1, 2027 | Statewide | $15.65 | officially announced on the Industrial Commission of Arizona 2027 minimum wage poster (published September 2026) |
Workers covered by both laws get the higher rate. Read the Arizona rule.
Cities and counties with their own minimum wage
| Place | Rate | Since | Source |
|---|---|---|---|
| Flagstaff | $18.35 | January 1, 2026 | ordinance page |
| Tucson | $15.45 | January 1, 2026 | ordinance page |
Overtime
Time and a half after 40 hours in a week. The salary test for exempt employees is the federal $684 a week. Arizona's wage statutes (A.R.S. 23-350 to 23-363) set minimum wage and payment timing but no private-sector overtime rule. source
Sick leave and family leave
Paid sick leave: 1 hour for every 30 hours worked (15 or more employees: up to 40 h/year; fewer than 15 employees: up to 24 h/year (unless the employer sets a higher limit).), all employers. Earned paid sick time under the Fair Wages and Healthy Families Act (Proposition 206, 2016). source
No state paid family leave insurance: the federal FMLA gives eligible workers up to 12 weeks of unpaid, job-protected leave.
Final paycheck and unused vacation
Fired or laid off: within 7 working days or by the end of the next regular pay period, whichever is sooner. Quitting: no later than the regular payday for the pay period in which the termination occurred. Vacation: No statute requires payout of accrued vacation; it is owed only where the employer's policy or contract creates a reasonable expectation of payment (wages = compensation the employee has a reasonable expectation to be paid).. source vacation rule
Meal and rest breaks
No meal break is required for adults by state law. No paid rest break is required for adults. source
Unions and dismissal
Arizona is a right-to-work state: a union contract cannot require you to pay dues or fees to keep your job. Employment is at will: either side may end it at any time, except for an illegal reason such as discrimination or retaliation, or against a contract. source
Also worth knowing in Arizona
- Flagstaff has the highest minimum wage in Arizona ($18.35 in 2026, $18.95 in 2027) and bans the tip credit, so servers earn the full rate before tips. source
- The statewide minimum wage rises to $15.65 on January 1, 2027, following the annual CPI adjustment written into Arizona law by voters. source
- Tipped workers can be paid at most $3.00 an hour below the minimum wage, one of the smallest tip credits in the country. source