Arizona labor laws do not have state-specific overtime rules. Overtime pay in Arizona is regulated by the federal Fair Labor Standards Act (FLSA). The act requires employers to pay overtime for all hours worked in excess of 40 hours in a week.
This guide covers Arizona’s overtime regulations, including pay rates, eligibility, overtime exemptions, and legal considerations to help employers and employees understand their rights and responsibilities.
Arizona Overtime Laws Summary
| Federal law | FLSA provisions for overtime |
| State overtime law | None |
| Overtime pay rate | 1.5 times the regular rate of pay for all hours worked in excess of 40 hours in a week |
| Minimum wage | $15.15 per hour |
| Minimum overtime wage | $22.72 per hour for minimum wage workers |
| Compensatory time instead of overtime pay | Allowed for state agency employees |
| Salary threshold for overtime exemption | $684/week |
This Article Covers
- Overtime Pay Rates in Arizona
- Who is Entitled to Overtime in Arizona?
- Overtime Exemptions in Arizona
- Overtime Pay for Tipped Employees in Arizona
- Overtime for Salaried Employees in Arizona
- Is Compensatory Time Allowed in Arizona?
- Recordkeeping Requirements for Arizona Employers
- Penalties for Violating Overtime Laws in Arizona
Overtime Pay Rates in Arizona
Overtime pay in Arizona is regulated by the federal FLSA, which considers all work done over 40 hours in a week as overtime. Employees must receive overtime pay calculated at 1.5 times their regular hourly wage for all overtime hours.
Arizona’s minimum wage is $15.15 per hour as per the Fair Wages and Healthy Families Act. This means the state’s minimum overtime wage is $22.72 ($15.15 x 1.5) per hour.
What counts as hours worked for overtime calculations?
An employee’s hours worked include all the time they are required to be on the worksite, on duty, or actively performing job-related tasks, under the FLSA.
The federal law does not automatically consider work performed on weekends, holidays, or regular days off as overtime. Instead, overtime applies only when an employee’s total working hours exceed 40 hours in a single workweek.
What is a workweek under the FLSA?
A workweek is defined as a fixed period of 168 hours or seven consecutive 24-hour days, under the DLSA. This period can begin on any day of the week and at any time chosen by the employer.
For the purpose of calculating overtime, each workweek must be treated separately. Employers are not allowed to average an employee’s hours over two or more workweeks.
To learn more, read our detailed article on your overtime rights in Arizona.
Who is Entitled to Overtime in Arizona?
Overtime pay is required for any non-exempt employees in Arizona following FLSA standards. This includes most hourly employees and certain salaried employees, provided they earn below the FLSA salary threshold and perform non-exempt job duties.
Overtime Exemptions in Arizona
Some salaried employees in Arizona earning over $684 per week (equivalent to $35,568 per annum) are exempt from overtime pay under federal standards.
Other employees exempted from overtime pay under the FLSA include:
- Highly compensated employees earning over $107,432 per year, including at least $684 per week paid on a salary or fee basis
- Motion Picture industry employees earning over $1,043 per week (or a proportionate amount based on the number of days worked)
- Salaried computer employees earning over $27.63 per hour
- Executive, administrative, and professional employees
- Outside sales employees
- Employees working for seasonal amusement and recreational businesses
- Employees at small local newspapers
- Farmworkers employed by small farms with limited labor usage
- Babysitters and companions for elderly or disabled individuals
- Certain commissioned employees in retail or service businesses
- Salespeople and mechanics working for automobile, truck, or farm equipment dealerships
- Some transportation workers, including railroad and airline employees, taxi drivers, and certain motor carrier workers
- Live-in domestic help
- Certain agricultural workers and petroleum distribution employees may have partial overtime exemptions
- Hospitals and residential care facilities may use a 14-day work period, with overtime paid for hours exceeding eight hours in a day or 80 hours in 14 days, depending on the agreement with employees
- Firefighters and police officers working for public agencies may have work periods ranging from seven to 28 days, with overtime calculated differently
Learn more about federal overtime exemptions with a handy guide to the FLSA.
Overtime Pay for Tipped Employees in Arizona
Employers in Arizona are legally allowed to take a tip credit. A tip credit allows employers to count a portion of an employee’s tips toward meeting the minimum wage requirement.
In Arizona, the maximum tip credit that can be taken against the minimum hourly wage is $3. This means employers can pay tipped employees a minimum cash wage of $12.15 ($15.15 – $3.00) per hour.
An tipped employee’s regular rate of pay is calculated by combining their minimum hourly cash wage and the earned tip credit in Arizona. When a tipped employee works more than 40 hours a week, they are entitled to overtime pay at 1.5 times their regular rate of pay (or at least the state’s minimum wage of $15.15 per hour).
Learn more about how to calculate overtime pay in Arizona.
Overtime for Salaried Employees in Arizona
Some salaried employees in Arizona may qualify for overtime pay if they are classified as non-exempt under the FLSA. Eligibility depends on both the employee’s job duties and their salary level.
Generally, employees earning less than $684 per week ($35,568 per year) qualify for overtime pay under federal law.
For eligible salaried employees in Arizona, overtime is calculated using their regular hourly rate. This rate is determined by dividing the employee’s salary by the number of hours the salary is intended to cover.
Overtime pay = Employee’s Regular Hourly Rate x 1.5
If you want a quick way to estimate overtime hours and wages, you can use our overtime calculator to simplify the calculation for Arizona employees.
Is Compensatory Time Allowed in Arizona?
Compensatory time is allowed instead of overtime pay in Arizona for certain public employees, but the rate depends on whether federal overtime rules apply.
If federal law requires overtime pay, these employees must get either 1.5 times their regular pay or 1.5 hours of compensatory time off for each overtime hour worked.
However, if federal law does not require overtime pay, the employer can choose to give either regular pay or compensatory time off on an hour‑for‑hour basis.
Recordkeeping Requirements for Arizona Employers
Under the Fair Labor Standards Act, Arizona employers must maintain accurate records of hours worked and wages paid to all non-exempt employees. These records should include an employee’s daily hours worked, total weekly hours, regular hourly pay rate, total straight-time earnings (daily or weekly), and total weekly overtime pay.
Employers must also keep supporting payroll documents for at least two years. Any timekeeping method can be used as long as it accurately records work hours, such as our free time tracking software.
Penalties for Violating Overtime Laws in Arizona
Employers violating Arizona overtime laws, which generally follow the federal FLSA for work over 40 hours a week, can face significant penalties. These include paying back wages, plus an equal amount in liquidated damages, attorney fees, and court costs.
Employers who willfully or repeatedly break the federal overtime rules can face civil penalties of up to $1,000 per violation. In extreme cases, willful violations may lead to criminal prosecution, fines up to $10,000, and even imprisonment for repeat offenders.
Learn about penalties for breaking other labor laws in Arizona.
Important Cautionary Note
This content is provided for informational purposes only. While we make every effort to ensure the accuracy of the information presented, we cannot guarantee that it is free of errors or omissions. Users are advised to independently verify any critical information and should not solely rely on the content provided.
