labor lawAdivision of labor law center

The Arizona minimum wage will increase by 35 cents, from $6.90 to $7.25 per hour on January 1, 2009. This is the first annual cost-of-living increase under the new Arizona minimum wage law. The increase is based on the annual inflation rate as reported by the CPI, the Consumer Price Index.  

On November 7, 2006, the Arizona voters approved Proposition 202, also known as the “Raise the Arizona Minimum Wage for Working Arizonans Act.” Under A.R.S. 23-364(A), which became effective January 1, 2007, the Industrial Commission of Arizona was given the authority to enforce and implement the Act.  Effective January 1, 2008, Arizona’s minimum wage increased to $6.90 per hour.  

Every employer covered under the Act is required to pay each employee wages not less than this amount, according to the Industrial Commission of Arizona.Effective January 12, 2008, final Administrative Rules under Title 20, Chapter 5, Article 12 were approved and are currently in effect.  

The Arizona minimum wage applies to part-time and temporary workers, as well as full-time permanent workers.  

Arizona permits employers to take up to $3.00 per hour as a tip credit, which suggests that the minimum wage for tipped employees will be $4.25 per hour in 2009.  If employees do not average at least the minimum wage in tips plus wages, the employer must pay the difference. The employee must receive at least the minimum wage for all hours worked.  

The are a number of exceptions under the Arizona minimum wage law. The act does not apply to individuals employed by a parent or sibling. It does not apply to babysitters in the employer’s home or used on a casual basis. 

The most important exception is that the Arizona minimum wage does not apply to businesses with less than $500,000 in revenue, that are not covered by the federal Fair Labor Standards Act or FLSA. In most states, the state minimum wage covers all employers or nearly all employers. In Arizona, it applies only to those who would be covered under the federal minimum wage, anyway. 

The Industrial Commission of Arizona enforces the state minimum wage law. Employers are prohibited from taking any action against employees or anyone else, based on asserting their rights or assisting in an investigation under the minimum wage law.

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