Arizona Minimum Wage 2026
⚠️Informational only — not legal or tax advice.
Last Updated: February 4, 2026
Last Reviewed: February 4, 2026
Applicable Period: 2026
Jurisdiction: State of Arizona, United States
Update Schedule: Quarterly reviews in 2026; annual reviews thereafter
Table of Contents
- Introduction
- Arizona Minimum Wage – 2026 Quick Reference
- Overview of Minimum Wage Law in Arizona
- Current Minimum Wage Rates in Arizona 2026
- Minimum Wage for Tipped Employees
- Local Minimum Wage Ordinances in Arizona
- Who Is Covered and Who Is Exempt
- Employer Obligations and Enforcement
- Arizona Minimum Wage vs Federal Law
- Minimum Wage Posting Requirements
- Frequently Asked Questions
- Information Verification Log
Introduction
The minimum wage in Arizona establishes the lowest hourly compensation that employers must legally provide to covered employees. For 2026, Arizona maintains a minimum wage of $15.15 per hour, with specific provisions for tipped employees and higher rates in Flagstaff and Tucson municipalities.
Minimum wage regulations in Arizona operate under Arizona Revised Statutes § 23-363 alongside federal requirements established by the Fair Labor Standards Act (FLSA). When state or local minimum wage rates exceed the federal standard, employers must comply with the higher applicable rate. Arizona allows tip credits up to $3.00 per hour, and two local jurisdictions have enacted higher minimum wage ordinances.
This page provides an authoritative overview of Arizona minimum wage law for 2026, including current rates, scheduled increases, tipped employee provisions, local wage ordinances, coverage and exemptions, enforcement procedures, and compliance requirements. All information is compiled from official government sources.
| Arizona Minimum Wage — 2026 Quick Reference | |||
|---|---|---|---|
| Category | Rate | Effective Date | Official Source |
| State minimum wage | $15.15/hour | January 1, 2026 | A.R.S. § 23-363 |
| Tipped minimum wage | $12.15/hour | January 1, 2026 | A.R.S. § 23-363(C) |
| Tip credit allowed | Yes (up to $3.00) | — | A.R.S. § 23-363(C) |
| Next scheduled increase | $15.60 (estimated) | January 1, 2027 | ICA Annual Adjustment |
| Rate adjustment mechanism | CPI-indexed | — | A.R.S. § 23-363(B) |
| Federal minimum wage | $7.25/hour | July 24, 2009 | FLSA |
| Local minimum wages | Yes (2 cities) | Varies | Flagstaff , Tucson |
Last verified: February 4, 2026 via Industrial Commission of Arizona website
Overview of Minimum Wage Law in Arizona
Arizona minimum wage requirements are established under Arizona Revised Statutes § 23-363. The Industrial Commission of Arizona administers and enforces minimum wage regulations in Arizona. The state minimum wage law was enacted through Proposition 206, the Fair Wages and Healthy Families Act, passed by voters in November 2016 and implemented on January 1, 2017.
Under the Fair Labor Standards Act (FLSA), the federal minimum wage establishes a floor of $7.25 per hour for covered employers and employees. Arizona law operates independently of federal minimum wage standards. When both state and federal minimum wage laws apply, employers must pay whichever rate is higher.
Because Arizona’s minimum wage of $15.15 exceeds the federal minimum, most covered employers must comply with the state rate. Employers not subject to state minimum wage requirements but covered by federal law must comply with FLSA standards.
Arizona minimum wage law applies to employers regardless of size. The Fair Wages and Healthy Families Act covers virtually all private sector employers and employees within Arizona, with limited exceptions. Independent contractors properly classified under Arizona law are not covered, though misclassification may result in penalties and back wages.
The principle of “higher prevailing rate” requires employers to pay the highest applicable minimum wage—whether federal, state, or local. In Arizona, this means employers must identify and apply whichever minimum wage rate provides employees the highest hourly compensation.
Current Minimum Wage Rates in Arizona 2026
Standard Hourly Minimum Wage
As of January 1, 2026, the standard minimum wage in Arizona is $15.15 per hour for covered employees. This rate applies to all non-exempt employees working for covered employers throughout the state, outside of Flagstaff and Tucson city limits.
Arizona adjusts its minimum wage annually based on the Consumer Price Index for All Urban Consumers (CPI-U). The 3.0% increase from 2025’s rate of $14.70 reflects inflation adjustment measured between August 2024 and August 2025. The Industrial Commission of Arizona calculates and announces the adjusted rate each September for the following calendar year.
The standard statewide rate applies throughout Arizona except in jurisdictions that have enacted higher local minimum wages. Flagstaff and Tucson maintain their own minimum wage ordinances with rates exceeding the state standard.
No Employer Size Variations
Arizona does not establish different minimum wage rates based on employer size. All covered employers must pay at least $15.15 per hour regardless of the number of employees or annual revenue. This uniform application applies to businesses with one employee through large corporations operating statewide.
Small businesses that gross less than $500,000 in annual revenue may be exempt from Arizona minimum wage requirements if they are also exempt from the federal Fair Labor Standards Act under 29 U.S.C. § 206(a). However, most employers are covered by either state or federal law.
No Industry-Specific Rates
Arizona does not establish industry-specific minimum wage rates. The $15.15 standard applies uniformly across all industries including retail, hospitality, healthcare, manufacturing, and service sectors. Unlike some states, Arizona has not enacted enhanced wage requirements for fast food workers, healthcare employees, or other industry categories.
Scheduled Increases
Arizona’s minimum wage increases automatically each January 1 based on inflation. Beginning January 1, 2027, the minimum wage will adjust based on the percentage increase in the Consumer Price Index for All Urban Consumers (CPI-U) measured between August of the preceding year and August of the prior year. The Industrial Commission of Arizona publishes the new rate each September.
Under A.R.S. § 23-363(B), the amount of the minimum wage increase is rounded to the nearest multiple of five cents. Based on current inflation trends, the 2027 minimum wage is estimated to be approximately $15.60 per hour, though the actual rate will be determined by the August 2026 CPI-U data.
No legislatively-mandated scheduled increases beyond the automatic CPI adjustment exist. Arizona’s minimum wage will continue to increase annually in perpetuity based on the cost of living formula established in state statute.
Minimum Wage for Tipped Employees
Tipped Employee Cash Wage
Arizona permits employers to pay tipped employees a reduced cash wage, provided that employee tips combined with the cash wage equal at least the full minimum wage.
Cash wage requirement: $12.15 per hour
Maximum tip credit: $3.00 per hour
Total minimum compensation: $15.15 per hour (cash wage + tips)
Under A.R.S. § 23-363(C), the tip credit is capped at exactly $3.00 per hour regardless of future minimum wage increases. As the standard minimum wage rises annually with inflation, the required cash wage for tipped employees also increases to maintain the $3.00 maximum credit.
Who Qualifies as a Tipped Employee
Under Arizona law, a “tipped employee” is defined as an employee who customarily and regularly receives tips or gratuities from patrons or others. Arizona regulations align with federal FLSA standards in determining tipped employee status. Qualifying occupations typically include:
- Restaurant servers and bartenders
- Hotel and casino service workers
- Parking attendants and valets
- Delivery drivers who receive tips
- Hair stylists and barbers who receive tips
- Golf caddies and other service personnel
Employees must customarily and regularly receive tips as defined under federal wage and hour regulations. Occasional or sporadic tip receipt does not establish tipped employee status.
Employer Obligations for Tipped Workers
Employers who claim a tip credit must:
- Inform employees of the tip credit provisions under A.R.S. § 23-363(C) before claiming the credit
- Ensure total compensation (cash wage plus tips) equals or exceeds the full minimum wage of $15.15 for all hours worked
- Pay the difference if an employee’s tips fail to bring total compensation to the minimum wage
- Maintain accurate records of employee tips and hours worked, including charged tips and employee declarations for FICA purposes
- Calculate tip credit compliance by averaging tips received over the employer’s payroll period or another period selected by the employer that complies with Industrial Commission regulations
Employers cannot retain any portion of employee tips. Under Arizona law, all tips received by employees are the property of the employee and must not be used by employers to satisfy other wage obligations.
Tip Pooling and Sharing
Arizona allows tip pooling arrangements where tipped employees voluntarily share tips with other employees. Tip pools must be distributed among employees who customarily and regularly receive tips. Employers, managers, and supervisors cannot participate in tip pools or retain any portion of tips contributed by employees.
Mandatory service charges added to customer bills are not considered tips under Arizona law. Service charges are the property of the employer unless the employer clearly designates them as tips for employees. Employers must inform customers if service charges are not distributed to service employees.
Employers cannot require employees to share tips with employees who do not customarily and regularly receive tips. The Industrial Commission of Arizona enforces tip pooling requirements and investigates complaints regarding improper tip retention or distribution.
Local Minimum Wage Ordinances in Arizona
In addition to the state minimum wage, two cities in Arizona have enacted their own minimum wage ordinances that exceed the state rate. Employers must comply with the highest applicable rate—federal, state, or local—for the jurisdiction where work is performed.
| Arizona City and County Minimum Wages (2026) | ||||
|---|---|---|---|---|
| City / County | Rate | Effective Date | Employer Size Requirements | Official Source |
| Flagstaff | $18.35/hour | January 1, 2026 | All employers | Flagstaff City Code Title 15 |
| Tucson | $15.45/hour | January 1, 2026 | 5+ hours worked per pay cycle | Tucson City Code Chapter 17 |
This table covers all jurisdictions in Arizona with established minimum wage ordinances. No other Arizona cities or counties have enacted separate minimum wage rates.
Flagstaff Minimum Wage
The City of Flagstaff maintains the highest minimum wage in Arizona at $18.35 per hour, effective January 1, 2026. Flagstaff voters approved Proposition 414 (The Minimum Wage Act) in November 2016, establishing a local minimum wage that adjusts annually for cost of living.
Flagstaff Rate Details:
- Current rate: $18.35 per hour (all employees)
- Tipped employees: $18.35 per hour (no tip credit allowed beginning 2026)
- Coverage: Employees working 25 or more hours per calendar year within city limits
- Adjustment: Annual CPI increase effective each January 1
Beginning January 1, 2026, Flagstaff eliminated the lower minimum wage for tipped employees. Under the updated ordinance, all employees must receive the full minimum wage of $18.35 per hour regardless of whether they customarily receive tips. This change was mandated by the 2016 ballot measure.
Employers operating within Flagstaff city limits must pay the $18.35 rate even if they also have locations outside Flagstaff. The applicable rate is determined by where the employee physically performs work. The City of Flagstaff Labor Standards Office enforces the local ordinance and investigates wage complaints.
Tucson Minimum Wage
The City of Tucson maintains a minimum wage of $15.45 per hour, effective January 1, 2026. Tucson voters approved Proposition 206 (The Tucson Minimum Wage Act) in November 2021, establishing a local minimum wage that began at $13.00 in April 2022 and increased to $15.00 by January 2025.
Tucson Rate Details:
- Current rate: $15.45 per hour
- Tipped employees: $12.45 per hour (tip credit of $3.00 allowed)
- Coverage: Employees working at least 5 hours per pay cycle within city limits
- Adjustment: Annual CPI increase effective each January 1
The Tucson minimum wage applies to full-time, part-time, and temporary employees who perform at least five hours of work per pay cycle within Tucson’s geographic boundaries. Employers may take a tip credit of up to $3.00 per hour for tipped employees, provided total compensation equals at least $15.45.
Exemptions from Tucson minimum wage:
- Employees of the State of Arizona
- Employees of the United States government
- Employees of tribal entities
- Casual employees performing babysitting services in the employer’s home
- Properly classified independent contractors
The City of Tucson Labor Standards Unit within the Business Services Department enforces the local ordinance. Employers can contact the unit at (520) 791-5611 or minimumwage@tucsonaz.gov.
How Local Minimum Wages Apply
Location of Work Controls: The applicable minimum wage is determined by where the employee physically performs work, not where the employer’s headquarters or main office is located. An employee working within Flagstaff city limits must receive Flagstaff’s minimum wage even if employed by a company headquartered elsewhere in Arizona.
Employee Split Between Jurisdictions: When an employee works in multiple jurisdictions during a single workweek, employers must pay the minimum wage rate applicable for each location based on hours worked there. For example, an employee working 20 hours in Phoenix and 20 hours in Tucson during one week must receive $15.15 for Phoenix hours and $15.45 for Tucson hours.
Remote Work Considerations: For employees working remotely, the minimum wage of the jurisdiction where the employee physically performs work generally applies. A remote worker located within Flagstaff must receive Flagstaff’s $18.35 rate even if their employer operates outside the city. If annexed into a city with a local minimum wage, coverage begins 90 days after annexation.
Enforcement: Local minimum wage ordinances are enforced by city labor standards offices. The City of Flagstaff and City of Tucson maintain dedicated enforcement units that investigate complaints, conduct compliance audits, and impose penalties for violations.
Scheduled Local Minimum Wage Increases
Both Flagstaff and Tucson adjust their minimum wages annually based on the Consumer Price Index. Future rates will be announced each fall for implementation the following January 1.
| Arizona Local Minimum Wage Adjustments (2026) | ||
|---|---|---|
| City / County | Current Rate (2026) | Adjustment Method |
| Flagstaff | $18.35 | Annual CPI adjustment (approximately 3% based on recent trends) |
| Tucson | $15.45 | Annual CPI adjustment matching state methodology |
The Industrial Commission of Arizona publishes state rate adjustments each September. Flagstaff and Tucson announce their local rates shortly thereafter using similar CPI-based calculations.
Additional Local Requirements
The Tucson Minimum Wage Act imposes additional requirements beyond the minimum wage rate:
Scheduling Pay for Large Employers: Employers averaging 26 or more employees must pay at least three hours of minimum wage when:
- An employee is scheduled for at least three hours, reports for duty, and is sent home after fewer than three hours, or
- The employer cancels a shift with less than 24 hours’ notice
Prohibited Pay Deductions: Employers cannot make deductions from employee pay that result in compensation below minimum wage, including deductions for employer-provided meals, uniforms, or damaged goods.
Posting Requirements: Both Flagstaff and Tucson require employers to display official minimum wage posters in conspicuous workplace locations. Posters are available at city websites in English and Spanish.
Employers should consult local ordinances to ensure full compliance with all applicable workplace requirements beyond basic minimum wage rates.
Who Is Covered and Who Is Exempt
Employees Covered by Arizona Minimum Wage
Arizona minimum wage law covers virtually all private sector employers and employees regardless of business size or revenue. Unless specifically exempted, covered employees include:
- Private sector workers: Full-time and part-time employees of private businesses
- Salaried non-exempt employees: Employees paid on a salary basis who do not qualify for overtime exemption
- Hourly employees: Workers compensated on an hourly basis
- Temporary and seasonal workers: Employees hired for temporary or seasonal positions
- Minor employees: Workers under age 18 (covered at same rate as adults)
- Undocumented workers: All employees covered regardless of immigration status
- Workers paid in cash: Payment method does not affect minimum wage obligations
Arizona’s broad coverage extends to substantially all employment relationships within the state. The Industrial Commission of Arizona enforces minimum wage requirements and investigates claims of improper exemption classification.
Exemptions from Minimum Wage Requirements
The following categories of employees may be exempt from Arizona minimum wage requirements under A.R.S. § 23-363:
Employees of Parents or Siblings
Persons employed by a parent or sibling are exempt from Arizona minimum wage requirements. This family member exemption applies regardless of the nature of the business or work performed.
Casual Babysitters
Persons employed performing babysitting services in the employer’s home on a casual basis are exempt. The exemption applies only to casual, non-regular babysitting arrangements in private homes.
Government Employees
Employees of the State of Arizona or the United States government are exempt from Arizona minimum wage law. These employees are covered by separate public sector compensation systems.
Small Businesses Under Federal Threshold
Small businesses that gross less than $500,000 in annual revenue may be exempt from Arizona minimum wage if they are also exempt from FLSA coverage under 29 U.S.C. § 206(a). However, these businesses must still comply with federal minimum wage if covered by the FLSA.
Independent Contractors
Properly classified independent contractors are not employees and therefore not covered by minimum wage requirements. Arizona applies strict tests to determine independent contractor status, and misclassification may result in penalties and back wages. Under Arizona law, individuals are presumed to be employees unless the employer establishes:
- The individual is free from control and direction in performing work
- The individual performs work outside the usual course of the employer’s business
- The individual is customarily engaged in an independently established trade or business
No Youth or Training Wage Provisions
Arizona does not authorize reduced wages for young workers or employees in training periods. All covered employees must receive the full minimum wage from their first hour of employment regardless of age, experience, or training status.
No Student Worker Exemptions
Arizona does not permit reduced wages for full-time students working part-time. Student workers must receive the same minimum wage as all other employees.
No Disability-Based Subminimum Wages
Arizona does not authorize special certificates allowing subminimum wages for workers with disabilities. All covered workers must receive the full minimum wage regardless of productivity levels or disability status.
Federal Exemptions May Apply
Employees exempt from Arizona minimum wage may still be covered by federal minimum wage under the FLSA. Common federal exemptions include:
Executive, Administrative, and Professional Employees: Employees performing bona fide executive, administrative, or professional duties may be exempt if they meet both salary and duties tests under federal law. For 2026, the federal salary threshold is $844 per week ($43,888 annually) for most exempt classifications.
Outside Sales Employees: Employees whose primary duty is making sales away from the employer’s place of business may be exempt from minimum wage requirements under federal law.
The interaction between state and federal exemptions can be complex. The Industrial Commission of Arizona and U.S. Department of Labor provide guidance on exemption classifications.
Employer Obligations and Enforcement
Employer Compliance Obligations
Employers subject to Arizona minimum wage law must:
- Pay the applicable minimum wage for all hours worked by covered employees
- Maintain accurate payroll records documenting hours worked and wages paid for each employee
- Display required posters informing employees of minimum wage rates and rights
- Issue compliant wage statements showing gross wages, deductions, and net pay each pay period
- Provide written notice of wage rates to employees at time of hire
- Comply with tip credit documentation if claiming tip credits for tipped employees
Recordkeeping Requirements: Employers must maintain payroll records for three years under Arizona Administrative Code R20-5-1201, including:
- Employee names, addresses, and occupations
- Hours worked each workday and workweek
- Wage rates and total wages paid each pay period
- Deductions from wages and reasons for deductions
- For tipped employees: records of charged tips and tip declarations
Failure to maintain adequate records creates a presumption that violations occurred and shifts the burden to the employer to prove compliance.
Enforcement of Minimum Wage Law
The Industrial Commission of Arizona enforces minimum wage requirements in Arizona through its Labor Department. The agency:
- Investigates wage complaints filed by employees
- Conducts compliance inspections of employer payroll practices
- Issues citations and orders for minimum wage violations
- Collects unpaid wages and penalties on behalf of employees
- Provides education to employers and employees about wage requirements
Filing a Complaint: Employees who believe they have not been paid proper minimum wage may file a complaint with the Industrial Commission of Arizona through:
- Online: ICA Labor Complaint Forms
- Phone: (602) 542-4661 (Phoenix) or (520) 628-5459 (Tucson)
- Mail: Industrial Commission of Arizona, Labor Department, 800 W. Washington Street, Phoenix, AZ 85007
- In person: Phoenix office at 800 W. Washington Street or Tucson office at 2675 E. Broadway Blvd
Arizona law prohibits retaliation against employees who file wage complaints, participate in investigations, or assert their rights under minimum wage law. Retaliatory discharge or adverse action creates additional liability for employers.
Complaint Process: After receiving a complaint, the Industrial Commission investigates by:
- Notifying the employer of the complaint and requesting payroll records
- Reviewing documentation and interviewing relevant parties
- Determining whether violations occurred
- Ordering payment of back wages and penalties if violations are found
- Monitoring employer compliance with orders
Employees do not need an attorney to file complaints. The Industrial Commission provides assistance throughout the process and can recover wages on behalf of employees at no cost.
Penalties for Minimum Wage Violations
Employers who violate Arizona minimum wage law may be subject to:
Back Wages: Employers must pay employees the difference between wages paid and the required minimum wage for all hours worked. Back wage liability typically extends three years from the date of violation under Arizona’s statute of limitations.
Treble Damages: Under A.R.S. § 23-364, employees may recover up to three times the amount of unpaid wages plus reasonable attorney fees and costs. Treble damages serve as compensation for delayed payment and deter wage violations.
Civil Penalties: The Industrial Commission of Arizona may assess civil penalties for willful or repeated violations. Penalties are paid to the state and are separate from back wages owed to employees.
Retaliation Penalties: Employers who retaliate against employees for asserting minimum wage rights face additional penalties including:
- Reinstatement of terminated employees
- Back pay for lost wages due to retaliation
- Additional damages for unlawful retaliation
- Civil penalties for violating anti-retaliation provisions
Attorney Fees: Employees who prevail in minimum wage actions are entitled to recover reasonable attorney fees and costs of litigation. This fee-shifting provision enables employees to pursue claims without bearing litigation costs.
Local Penalties: Cities with local minimum wage ordinances may impose additional penalties:
- Flagstaff: Civil penalties and business license sanctions
- Tucson: Civil infractions with penalties up to $100 per violation per day, plus potential business license revocation for repeated violations
Arizona Minimum Wage vs Federal Law
The Federal Minimum Wage Floor
The Fair Labor Standards Act (FLSA) establishes a federal minimum wage of $7.25 per hour, which has remained unchanged since July 24, 2009. This federal rate sets a floor for minimum wage requirements nationwide and applies to employers engaged in interstate commerce or with annual gross sales exceeding $500,000.
The federal minimum serves as a baseline protection for workers in states without their own minimum wage laws or with rates below the federal standard. Employees covered by the FLSA must receive at least $7.25 per hour regardless of state law.
When State Law Applies
Because Arizona’s minimum wage of $15.15 exceeds the federal minimum, most employees working in Arizona are entitled to the higher state rate. The federal minimum serves as a fallback only for the limited category of employers covered by federal but not state law.
Arizona minimum wage law applies regardless of whether an employer is covered by the FLSA. The state’s broader coverage extends to many small businesses and employment relationships that fall outside federal jurisdiction. When both laws apply, employers must pay the higher rate.
Higher Applicable Rate Rule
The fundamental principle governing minimum wage compliance is that employers must pay whichever rate—federal, state, or local—provides employees the highest hourly wage. This rule ensures workers receive maximum protection under applicable law.
Practical Application:
- Identify all minimum wage rates that may apply (federal, state, local)
- Determine which rates cover the specific employer and employee
- Pay the highest applicable rate for hours worked in each jurisdiction
In Arizona, this often means comparing the federal minimum of $7.25, the state minimum of $15.15, and any applicable local minimum wage (Flagstaff $18.35 or Tucson $15.45) to determine which rate governs.
Example Scenarios:
Scenario 1: Employee works 40 hours per week at a restaurant in Phoenix. The employer must pay $15.15 per hour (Arizona state rate), which exceeds both the federal rate of $7.25 and the tipped minimum of $12.15.
Scenario 2: Tipped employee works at a restaurant in Flagstaff. The employer must pay $18.35 per hour (Flagstaff rate) with no tip credit allowed, which exceeds the Arizona tipped minimum of $12.15 and federal rate.
Scenario 3: Employee works 20 hours in Tucson and 20 hours in Phoenix during one week. The employer must pay $15.45 for Tucson hours and $15.15 for Phoenix hours.
Minimum Wage Posting Requirements
Arizona law requires employers to display an official minimum wage notice in a conspicuous location accessible to all employees. The poster must include current wage rates, employee rights under state law, and contact information for the Industrial Commission of Arizona.
Where to obtain posters:
- Download from Industrial Commission of Arizona Labor Department: Free PDF downloads in English and Spanish
- Available languages: English and Spanish versions required
- Updated annually: New posters released each fall for following year’s rates
Posting locations: The notice must be posted in each workplace location where employees can readily see it, typically near time clocks, in break rooms, at employee entrances, or other prominent locations accessible to all employees.
Additional Local Posting Requirements:
- Flagstaff: Employers must display Flagstaff minimum wage posters in addition to state posters
- Tucson: Employers must display Tucson minimum wage posters in addition to state posters
Compliance: Failure to display required posters may result in citations and penalties from the Industrial Commission. Employers must update posters when minimum wage rates change each January 1. Missing or outdated posters create a presumption of non-compliance during wage investigations.
Employers operating in multiple locations must post notices at each workplace. Remote workers must be provided electronic or mailed copies of required posters with information on how to access wage and hour protections.
Frequently Asked Questions: Minimum Wage in Arizona 2026
What is the minimum wage in Arizona in 2026?
The minimum wage in Arizona is $15.15 per hour as of January 1, 2026. Higher rates of $18.35 apply in Flagstaff and $15.45 in Tucson for work performed within city limits.
When is the next minimum wage increase in Arizona?
The next minimum wage increase in Arizona is scheduled for January 1, 2027. The rate will be adjusted based on the Consumer Price Index increase between August 2025 and August 2026. The Industrial Commission announces the new rate each September.
Does Arizona allow tip credit?
Yes, Arizona permits employers to pay tipped employees a cash wage of $12.15 per hour, with up to $3.00 in tip credit, provided total compensation reaches $15.15 per hour. Flagstaff does not allow tip credits—all employees must receive $18.35 per hour. Tucson allows a $3.00 tip credit, requiring cash wages of $12.45 per hour.
Are there different minimum wages in different cities in Arizona?
Yes, two cities in Arizona have enacted minimum wages higher than the state rate. Flagstaff’s minimum wage is $18.35 per hour, and Tucson’s is $15.45 per hour. Employers must pay the highest applicable rate for the location where work is performed.
Who is exempt from minimum wage in Arizona?
Common exemptions from Arizona minimum wage include employees of parents or siblings, casual babysitters in private homes, government employees, and properly classified independent contractors. Small businesses grossing under $500,000 annually may be exempt if not covered by federal law. Most hourly workers are covered.
What happens if an employer pays below minimum wage in Arizona?
Employers who pay below minimum wage face back wage liability for unpaid amounts, treble damages up to three times the unpaid wages, attorney fees and costs, and civil penalties. Employees can file complaints with the Industrial Commission within three years. Retaliation against workers who report violations is prohibited.
Do small businesses have to pay minimum wage in Arizona?
Yes, all employers in Arizona must pay minimum wage regardless of size. Even businesses with one employee must comply with the $15.15 hourly rate. Small businesses grossing under $500,000 annually may be exempt from state law but typically remain covered by federal minimum wage of $7.25.
Is Arizona’s minimum wage higher than the federal minimum?
Yes, Arizona’s minimum wage of $15.15 is $7.90 higher than the federal minimum wage of $7.25. Employers in Arizona must pay the higher state rate for all covered employees.
How often does Arizona increase its minimum wage?
Arizona adjusts its minimum wage annually on January 1 based on the Consumer Price Index for All Urban Consumers. The Industrial Commission announces the new rate each September for implementation the following January.
Can employers pay less than minimum wage during training?
No, Arizona does not authorize a training wage. Employers must pay at least $15.15 per hour from the first hour of employment regardless of training status, age, or experience level.
How to file a minimum wage complaint in Arizona
Employees who believe they have not received proper minimum wage compensation may file a wage complaint with the Industrial Commission of Arizona. Filing methods include:
- Online portal: ICA Labor Complaint Forms
- Phone: (602) 542-4661 (Phoenix) or (520) 628-5459 (Tucson)
- In-person: Phoenix office: 800 W. Washington Street, Phoenix, AZ 85007; Tucson office: 2675 E. Broadway Blvd, Tucson, AZ 85716
- Mail: Industrial Commission of Arizona, Labor Department, 800 W. Washington Street, Phoenix, AZ 85007
The Industrial Commission will investigate the complaint and may recover unpaid wages on behalf of the employee. Arizona law prohibits employer retaliation against workers who file wage complaints or participate in investigations.
Do remote workers in Arizona get the Arizona minimum wage?
Generally, the minimum wage of the jurisdiction where the employee physically performs work applies. Remote workers located in Arizona are entitled to Arizona’s minimum wage of $15.15, even if their employer is based in another state. If located in Flagstaff or Tucson, local minimum wages apply based on the remote worker’s physical work location.
Information Verification Log
All information on this page has been compiled from official government sources and verified for accuracy as of the dates below.
| Arizona Minimum Wage — Sources & Verification Log (2026) | ||
|---|---|---|
| Source | Last Verified | Full URL |
| Arizona Revised Statutes § 23-363 | February 4, 2026 | https://www.azleg.gov/ars/23/00363.htm |
| Industrial Commission of Arizona – Minimum Wage | February 4, 2026 | https://www.azica.gov/labor-minimum-wage-main-page |
| ICA 2026 Minimum Wage Announcement | February 4, 2026 | https://www.azica.gov/news/2026-minimum-wage-increase-effective-january-1-2026 |
| Arizona Administrative Code (Labor) | February 4, 2026 | https://www.azica.gov/labor-department |
| City of Flagstaff – Minimum Wage | February 4, 2026 | https://www.flagstaff.az.gov/3520/Minimum-Wage |
| City of Tucson – Minimum Wage Act | February 4, 2026 | https://www.tucsonaz.gov/Departments/Business-Services-Department/Tucson-Minimum-Wage-Act |
| U.S. Department of Labor – FLSA | February 4, 2026 | https://www.dol.gov/agencies/whd/flsa |
| U.S. Department of Labor – State Minimum Wage | February 4, 2026 | https://www.dol.gov/agencies/whd/minimum-wage |