Compliance Watch:

What are my rights as an hourly employee in Arizona?

It should be emphasized that Arizona has no specific regulations of its own that define the maximum weekly working hours that all of its employees are required to work. Instead, as per the Department of Administration, Arizona adheres to the federal labor laws in this regard, particularly the Fair Labor Standards Act (FLSA). This federal legislation governs overtime pay, the minimum hourly rate, and time management for all states in the US.

Despite the absence of legal provisions that clearly define the maximum working hours employees must work in a week, the FLSA states that employees who work beyond 40 hours in a given workweek are legally entitled to receive overtime payment that is fixed at 1.5 times their regular hourly wage. Although, employees with certain job categories and salary level may be exempted from receiving overtime payment.

It should be noted that certain types of employees may be exempt from earning the state’s regular minimum wage and are qualified to be paid at a reduced rate. The following types of employees who are exempt from earning the state’s minimum wage are as follows:

• Employees below the age of 20: These employees are eligible to be paid a wage rate of $4.25 per hour in the first 90 days of employment.
• Full-time students: Full-time high school and college students are eligible to earn a minimum hourly pay of $12.20 for up to 20 hours each week, which equates to 85% of the hourly minimum wage.
• Tipped employees: Employers can pay tipped employees a minimum hourly pay of $11.35 so long as the total wage combined with the tips earned meets the state’s minimum hourly wage of $14.35
• Domestic workers, such as babysitters.
• Employees employed by family members.
• Arizona or federal government employees.
• Employees employed by businesses that earn below than $500,000 per year and are not covered by the Fair Labor Standards Act (FLSA).

As per the Department of Administration, overtime laws are dictated by federal policy in Arizona, particularly the provisions of the FLSA. According to the federal FLSA, any hours worked beyond 40 hours in a given work week is regarded as overtime and the employee must be compensated accordingly at a pay rate of 1.5 times their regular hourly wage. Therefore, the minimum wage for working overtime in Arizona is $21.53 per hour and is expected to increase over the next couple of years due to the laws that Arizona has passed that will mandate this increase.

It should be noted that the U.S. Department of Labor has exempted overtime pay for workers in certain job categories and based on particular salary levels. With regards to certain salary levels, in Arizona, a salaried employee may be exempted from receiving overtime pay if they earn a minimum of $900.25 per week. This salary threshold is higher than the federal requirement, whereby a salaried employee would generally be exempt if they earned over $684 weekly.

As for particular job categories, the following jobs listed below are exempted from overtime pay under federal state law. These occupations include:

• Executive
• Administrator
• Particular retail employees with commission-based compensation.
• Outside Salespeople
• Employees hired as “learned professional” (CPA, lawyer, executive chef)
• Taxi Drivers

Unlike other states in the US, Arizona has no such laws for both its salaried and hourly employees that particularly define the duration of rest and meal breaks at both federal and state standards, even for its minor employees who are below the age of 18. Therefore, work breaks are scheduled at the employer’s discretion, and policies may differ from one company to another.

However, it should be emphasized that the U.S. Department of Labor provides some guidance with regards to regulating work breaks. Should an employer choose to provide rest and meal breaks to its employees, all breaks below 20 minutes must be compensated for while any breaks over 30 minutes long shall remain unpaid (so long as the employee is able to do what they please during that timeframe).

As for breastfeeding breaks in Arizona, there are no state laws that mandate employers to provide breaks for nursing mothers to pump milk. Although, the federal Fair Labor Standards Act (FLSA) grants reasonable rest breaks for non-exempt nursing mothers to express milk in a private non-bathroom environment for one year following a child’s birth.

There are several state and federal laws that entitle employees to take time away from work to attend to state duties or for personal matters of their own for reasons relating to their own serious health condition, the health of a family member, child rearing, or pregnancy. Below are some of the key legislation that governs mandatory leaves for both hourly and salaried employees in Arizona:

1. The Fair Wages and Healthy Families Act: Under the Fair Wages and Healthy Families Act, employers are required to pay for sick leave whereby employees may accrue up to 40 hours of sick leave in a year (for employers with more than 15 employees) or 24 hours of sick leave annually (for employers with less than 15 employees). This leave accumulates at an accrual rate of one hour of sick leave for every 30 hours of work performed and is not applicable. This leave particularly applies only to private employers.
2. The Family and Medical Leave Act: Employees are not granted family or medical leave under state law but are entitled to such leaves under federal legislation. The Family and Medical Leave Act provides 12 weeks of unpaid leave a year for employees who have been hired by the same employer for a minimum of 12 months and have worked for at least 1,250 hours. Employees typically use this leave to take care of a family member with a health issue, recover from their own serious health condition, or care for a newborn or adopted child.
3. Arizona Revised Statutes 21-236: The Arizona Revised Statutes 21-236 mandate employers to provide unpaid leave (that is not sick leave or vacation leave) for employees to serve jury duty without having their employment being compromised by way of dismissal or loss of job seniority.
4. Uniformed Services Employment and Reemployment Rights Act (USERRA): The federal Uniformed Services Employment and Reemployment Rights Act (USERRA) mandates employers to grant up to 5 years unpaid leave for military service to employees without having their employment position affected.

The Arizona Revised Statutes and the federal Fair Labor Standards Act (FLSA) are the primary laws that govern wage deductions for all employees in the state of Arizona. The federal regulations state that a reduction in wages is disallowed if it would result in the employee’s paycheck to fall below the federal minimum wage. This means that any deductions for the cost of uniforms, property damage, tools, or shortages in pay must not result in the employee’s wage to fall below Arizona’s minimum wage.

According to the Arizona Revised Statutes 23-352, an employer is only permitted to withhold or deduct any portion of an employee’s wages if:

1. The state or federal law has required the employer to do so (such as taxes or garnishments).
2. Prior written consent has been sought from the employee.
3. There is a reasonable good faith dispute as to the amount of wages due, including the amount of any counterclaim or any claim of debt, reimbursement, recoupment or set-off asserted by the employer against the employee.

Therefore, employers must be responsible for documenting every wage deduction to ensure it complies with the federal and state standards mentioned above.

The following list below comprises a variety of employment rights that generally all Michigan-based employees are entitled to, including hourly employees:

• Minimum Wage: Employees are legally entitled to receive the state minimum wage of $14.35. 
• Overtime: As per the Fair Labor Standards Act, Arizona hourly employees must receive overtime pay for working overtime hours beyond the 40 hours workweek at a rate of 1.5 times their regular minimum hourly wage.
• Child Labor protections:  Federal laws and Arizona’s Youth Employment Law protects the welfare and safety of minors of in employment. Among other restrictions, employers are mandated to ensure employees below the age of 18 are prevented from working in dangerous occupations involving the use of heavy machinery or toxic explosives.
• Paid Family and Medical leave: Employees of private sector employers may be eligible for Paid Family and Medical leave if their employer has voluntarily offered such leaves in their company policies. This leave is used for family caregiving or to attend to serious medical needs of themselves or their family members. Unlike the leave given under the federal FMLA, this leave may be party or fully compensated for.
• Domestic violence leave: Under Arizona Revised Statutes 23-373, all employees who are classed as victims of domestic or sexual abuse are legally to leave. This state legislation aims to support employees to seek the help that they need by providing them time off to attend to matter such as; 
  • Seeking medical care.
  • Attending court hearings.
  • Seeking psychological treatment.
  • Making relocation arrangements or obtaining legal services related to the abuse.

• Violations Reporting: Under section 23-1501(A)(3)(c)(ii) of the Arizona Revised Statutes Annotated, employees are protected from retaliation by their employers for reporting legal violations of the Arizona statutes within the workplace in good faith.
• Workplace safety: Employers in Arizona must comply with the Arizona Occupational Safety and Health Act of 1972 (Act). This state legislations mandates employers to ensure employees work in a workplace that is free from hazard which may potentially cause serious injury or death. 
• Background check laws: The Ban the Box law protects employees from being questioned about their criminal past in the early stages of recruitment in order to raise their chances of securing employment in Arizona. Hence, any convictions older than 7 years (for felony convictions) or 5 years (for misdemeanor offenses) must be disregarded by employers.
• Employment protection of minors: Arizona’s child labor laws protects minor employees from work exploitation. Under section 23-233 of Arizona Revised Statutes, children under 18 years cannot work beyond 8 hours in a day or 40 hours in a week, must be given breaks regularly and are not allowed to work between 10 p.m. to 6 p.m. Minors are also prohibited from engaging in dangerous activities during work that endanger their health and safety such as dealing with heavy machinery or working with toxic or explosive substances.

Resembling many other states in the US, Arizona also practices the ‘employment-at-will’ principle for all its employees. This principle derives from the common law employment-at-will doctrine and is not expressly outlined in Arizona laws. To put it simply, this doctrine provides both the employer and employee the entitlement to terminate the employment relationship at any time, for any or no reason. 

However, this principle encompasses certain exceptions in its general applicability, which prevents employees from being wrongfully terminated. These exceptions include:

Contractual agreement: If a written employment contract exists, the termination of employment will depend on the particular employment duration and specific grounds for termination that have been stipulated in the contract.

Public policy exception: Arizona based employers are disallowed from terminating an employee who has engaged in whistleblowing practices such as reporting illegal activities in the workplace.

Workplace discrimination: At both state and federal level, it is unlawful for Arizona employers to terminate an employee based on their protected characteristics such as:

• Race
• Color
• Sex
• National origin
• Pregnancy
• Religion
• Age
• Disability
• Genetic information

Severance pay is the payment and/or benefits that are given to employees upon the termination of their employment and is typically calculated based on the duration of their employment. However, the company’s policies determine the procedure and value of the severance payment. Severance payments are typically paid on a lump basis, although they can also be distributed in instalments.

In the state of Arizona, employers are not legally required to provide severance pay to both hourly and salaried employees. Although, if an employer decides to offer severance pay, such payment must comply with the terms of the employment contract and must be paid within 7 days from the date of their termination or by the end of the subsequent regular pay period.