Arizona Minimum Wage: Current Rate & Scheduled Increases

The federal Fair Labor Standards Act (FLSA), codified at 29 U.S.C. section 206, establishes a federal minimum wage of $7.25 per hour, unchanged since 2009. The FLSA applies to employers engaged in interstate commerce with gross annual sales or business of at least $500,000, or to those in specific industries such as hospitals, nursing homes, and schools. The FLSA prohibits paying covered employees less than the minimum wage for all hours worked and requires employers to maintain accurate records of hours and wages. Under the FLSA, employees entitled to minimum wage include non-exempt workers age 20 and older; younger workers may be paid $4.25 per hour during their first 90 calendar days. The Department of Labor (DOL) Wage and Hour Division enforces the FLSA and investigates complaints.

The FLSA does not mandate annual adjustments, and the federal floor has remained static since 2009, making it increasingly easy for states to exceed it. Remedies under the FLSA include back wages, liquidated damages (an additional sum equal to unpaid wages), and civil penalties. Employees may file complaints with the DOL or pursue private lawsuits, and the statute of limitations is two years (three years for willful violations).

Arizona Revised Statutes section 34-402 establishes Arizona's minimum wage and requires annual adjustment for inflation. As of January 1, 2024, Arizona's minimum wage is $16.50 per hour. This rate adjusts automatically on January 1 each year based on the Consumer Price Index for the Phoenix metropolitan area; if the adjustment would result in a wage below the prior year's rate, the rate does not decrease and remains flat. Arizona's minimum wage applies to any employer in the state with one or more employee, making it broader in coverage than the federal FLSA's $500,000 gross revenue threshold.

Arizona's minimum wage law is substantially stronger than the federal baseline. While the federal minimum wage remains $7.25 per hour, Arizona employers must pay the higher Arizona rate. The state does not permit the lower federal youth minimum wage ($4.25/hour after 90 days) or the federal subminimum for new workers under 20. Arizona's statute does permit tipped employees to be paid less than minimum wage only in limited circumstances under the tipped credit provisions, but Arizona still requires compliance with all state tip credit rules.

Arizona Revised Statutes section 34-401 defines covered employees as any individual employed by an employer, with narrow exemptions. Exempt categories include employees of the federal government, state government, and political subdivisions; employees under 20 years old in their first 90 calendar days of employment may be paid not less than $2.13 per hour if the employer has gross annual revenue of $500,000 or more (the federal subminimum, not Arizona's). Family members employed in a family business may be exempt under certain conditions. Employees in certain industries such as agriculture and domestic service have their own rules but remain covered by the general minimum wage unless specifically exempted.

Remedies under Arizona law include unpaid minimum wage, liquidated damages in an amount equal to the unpaid wages, attorney's fees, and court costs. Arizona courts have interpreted the statute to allow civil actions by employees, and the Industrial Commission of Arizona may investigate complaints. Unlike some federal claims, Arizona law does not restrict remedies to a fixed statute of limitations length—Arizona's statute of limitations for wage claims is generally three years for breach of contract claims involving wages.

Arizona law provides several exemptions from minimum wage requirements, though they are narrowly construed. Employees of the federal government, state government, and municipal/political subdivisions are exempt because they are not employed by private employers covered by A.R.S. section 34-402. Family members employed in a family business may be exempt under certain conditions, provided the family relationship and business structure meet statutory requirements; however, this exemption does not apply to all family employment situations and courts scrutinize it closely.

Under federal law incorporated into Arizona practice, employees under 20 years old in their first 90 consecutive calendar days of employment may be paid the federal minimum wage of $2.13 per hour (not Arizona's $16.50) only if the employer's gross annual revenue meets or exceeds $500,000 and the employee is not displacing another worker. Once the 90-day period ends, the employee must receive at least Arizona's minimum wage. This exemption is narrow and requires strict compliance with timing and employer size thresholds.

Salaried employees and independent contractors are not entitled to minimum wage protections if they are properly classified. However, Arizona courts apply strict tests to independent contractor classification; misclassification of employees as contractors is a common violation and can result in substantial liability. Certain agricultural workers may have modified minimum wage rules under specific conditions, though Arizona's agricultural exemptions are limited. Employees working in certain professions may be subject to different wage and hour rules, but these do not eliminate the minimum wage obligation. Piece-rate and commission-based workers must still receive at least the minimum wage when hours worked are factored in. Violations cannot be waived by employee agreement, even written; any agreement to work below minimum wage is void and unenforceable under Arizona law.

Step 1 — Document the violation. Keep detailed records of all hours worked (clock-in and clock-out times, or records provided by the employer's payroll system), pay stubs showing gross and net wages, and the dates you worked. Calculate the difference between what you were paid and what you should have been paid under Arizona's $16.50/hour (or current) minimum wage. Save copies of any written employment agreements, offer letters, and communications with your employer about pay. Take screenshots or photographs of timeclock records, email chains about hours or pay, and any written wage promises. Document dates, times, and details of conversations with managers or HR about pay disputes.

Step 2 — Attempt internal resolution (optional but advisable). Contact your supervisor, manager, or human resources department in writing (email preferred for documentation) and clearly state that you believe you have been paid below Arizona's minimum wage. Provide specific dates, hours worked, and the amount you believe you are owed. Give the employer a reasonable opportunity to respond and correct the wage violation—typically 5 to 10 business days. Many wage claims are resolved at this stage without litigation. Keep copies of all correspondence. If the employer refuses to address the issue or disputes your calculation, proceed to Step 3. Note that this internal step is not required by law, but it creates a clear record and may be viewed favorably by an agency or court.

Step 3 — File a wage complaint with the Industrial Commission of Arizona. Visit the Industrial Commission's website at www.azica.gov or call (602) 542-4661 to file a wage claim under A.R.S. section 34-227. You may file online, by mail, or in person at the Phoenix office or regional offices. Include your name, contact information, employer name and address, dates of employment, description of the wage violation (specifically that you were paid less than Arizona minimum wage), hours worked, and dates of underpayment. Attach copies of pay stubs, timesheets, and any written communications with your employer. There is no filing fee. The complaint should be filed within the applicable statute of limitations (generally three years for wage claims). The Industrial Commission will acknowledge receipt and assign an investigator.

Alternatively, you may file a wage claim in Arizona state district court without filing with the Industrial Commission, though the Commission process is often faster and requires no attorney. If you file directly in court, include the same documentation and serve the employer according to Arizona civil procedure rules. Consider consulting an attorney before filing in court (see Step 5).

Step 4 — Await investigation and resolution. The Industrial Commission investigator will contact you and your employer, request documentation of hours worked and wages paid, and review payroll records. The investigator may conduct an informal interview with both parties. This process typically takes 2 to 6 weeks depending on complexity and case load. The employer is required to produce accurate timekeeping records and payroll information. If the investigator determines a wage violation occurred, the employer may be ordered to pay unpaid minimum wages, liquidated damages (an amount equal to the unpaid wages), attorney's fees, and court costs. If the employer contests the finding, either party may request a hearing before an administrative law judge at the Industrial Commission; hearings are typically held within 60 to 120 days of request.

Step 5 — Consult an employment attorney if needed. If the amount owed is significant (typically $5,000 or more), if your employer contests the claim, or if you are concerned about retaliation, consult an Arizona employment attorney experienced in wage and hour law. Many attorneys work on contingency in minimum wage cases (meaning they are paid a percentage of the recovery). An attorney can help you calculate damages accurately, represent you at an Industrial Commission hearing, or litigate in court. Arizona law provides for attorney's fees in successful wage claims, so the employer may pay your attorney's fees if you prevail. If you are a member of a union or covered by an employment contract, consult an attorney before filing to ensure compliance with dispute resolution procedures in your agreement.