IA · state labor law, 2026
Iowa labor laws: minimum wage, overtime, leave, final pay and breaks
Iowa matches the federal minimum but limits how much of it tips may cover, and sends overtime questions to Washington.
Iowa and federal rules checked on official sources on · Checked by Radif Partners · How we calculate
- Minimum wage now
- $7.25/h
- statewide
- Next change
- none announced
- checked October 11, 2026
- Tipped cash wage
- $4.35/h
- tips must make up the rest
- Overtime
- 40 h/week
- federal FLSA rule
- Paid sick leave
- no state law
- employer policy
- Paid family leave
- no program
- FMLA is unpaid
Iowa's general minimum wage is $7.25 an hour in 2026, unchanged since 2008, and the state has no increase on the books for 2027; full time at that rate pays $15,080 a year. The figure that stands out is the tipped wage: Iowa caps the tip credit at 40 percent of the minimum, so a server receiving tips must still get at least $4.35 an hour in cash, against the federal $2.13. The state also lets employers pay a lower rate during a worker's first 90 calendar days, although employers covered by the federal FLSA must still pay $7.25. Iowa has no overtime statute of its own: the federal rule of time and a half after 40 hours applies, and the state wage unit refers overtime complaints to the U.S. Department of Labor. Final wages are due on the next regular payday, and vacation is paid out only under an employer policy.
Gross pay for this week in Iowa
$290
Time and a half after 40 hours in a week (federal rule)
| Minimum wage in Iowa now | $7.25 an hour |
| Your rate against it | At or above the minimum |
| Overtime: none this week | $0 |
| Paid sick leave earned in a year | No statewide paid sick leave law |
| Breaks owed in a 8-hour shift | None for adults (minors only) |
| Final paycheck if fired | by the next regularly scheduled payday |
| 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 $7.25. State rule applied. Minimum wage, overtime and leave rules have exceptions by employer size and industry. How this is calculated.
Tips can cover only part of the hour
Federal law lets an employer count tips toward all but $2.13 of the minimum wage. Iowa is stricter: once an employee makes about $30 a month in tips, the employer may credit tips for no more than 40 percent of the minimum, which is $2.90, leaving a cash wage of $4.35. That is $2.22 more per hour than the federal floor, or $67 over a 30-hour week. On a slow weekday shift where a bartender averages $2.00 an hour in tips, cash wage plus tips reaches $6.35, so the employer owes $0.90 more for each of those hours.
Do your tips cover the minimum wage?
Employer top-up owed per hour
$0.00
| Cash wage | $4.35 |
| Cash wage + tips | $8.35 |
| Minimum wage in Iowa | $7.25 |
| Top-up over a 30-hour week | $0 |
The first 90 days and the smallest businesses
Iowa Code 91D.1 allows a new-hire wage of $6.35 an hour until the employee completes 90 calendar days of employment. In practice the federal $7.25 overrides it for any employer covered by the FLSA, which includes most businesses with $500,000 or more in yearly sales and many smaller ones whose staff handle interstate commerce. The state minimum wage also leaves out most enterprises grossing under $300,000 a year, with exceptions for laundries, construction, hospitals, schools and a few other sectors. A worker at a very small shop may therefore be outside the state law yet still protected by the federal one. When in doubt, the U.S. Department of Labor can tell you which law reaches your job.
Overtime is a federal matter in Iowa
The Iowa Department of Inspections, Appeals, and Licensing does not enforce overtime. Its wage page tells workers who think they are owed overtime to contact the U.S. Department of Labor's Wage and Hour office. The federal rule is time and a half after 40 hours in a workweek, with no daily threshold. A line cook in Des Moines earning $21 who works 46 hours is owed $189 in overtime, for a gross week of $1,029. Salaried employees are exempt only if they earn at least $684 a week and meet a duties test; see the salary threshold for exempt employees.
Paychecks, leave and breaks
Whether you resign or are dismissed, the last paycheck is due on the next regularly scheduled payday. An employer needs your written consent before mailing a check. Unused vacation is owed only if the employer has a contract, policy or procedure to pay it to departing staff, and the state says plainly that Iowa law does not require employers to provide sick time, vacation pay or holiday pay. Adults have no state right to a meal break, but every employee must be allowed to use the toilet when needed, and minors under 16 get a 30-minute break when they work five hours or more in a day. Break rules in other states go further.
Iowa employment rules at a glance, 2026
Minimum wage schedule
| From | Who it covers | Rate | Note |
|---|---|---|---|
| January 1, 2008 | Statewide | $7.25 | Iowa Code 91D.1: $7.25 or the federal minimum, whichever is greater. |
Workers covered by both laws get the higher rate. New-hire wage: an employer may pay $6.35/hour until the employee completes 90 calendar days of employment (Iowa Code 91D.1(1)(d)); federal law may require $7.25 for FLSA-covered employers. Read the Iowa rule.
Overtime
Time and a half after 40 hours in a week. The salary test for exempt employees is the federal $684 a week. DIAL refers all overtime claims to the U.S. Department of Labor. source
Sick leave and family leave
Iowa has no statewide paid sick leave law for private employers; leave depends on the employer's policy or a city ordinance. Iowa law does not require sick, vacation or holiday pay; employers must follow their own policies. 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: by the next regularly scheduled payday. Quitting: by the next regularly scheduled payday. Vacation: Unused vacation is paid only if the employer has a contract, policy or procedure to pay it to departing employees.. 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. Minors under 16 must get a 30-minute break if they work 5 hours or more in a day. All employees must be allowed toilet breaks when needed. source
Unions and dismissal
Iowa 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 Iowa
- Iowa's tip credit is capped at 40% of the minimum wage, so tipped workers get at least $4.35/hour in cash, double the federal $2.13. source
- Iowa allows a lower $6.35 wage during an employee's first 90 calendar days with an employer. source
- An employer must get the employee's written consent before mailing a paycheck. source