As of 2026, the Arizona minimum wage is $14.80 per hour for most employers covered by the Arizona Minimum Wage Law. This rate is set by state law to rise each year on January 1 until it reaches $15.00 per hour, after which future adjustments will follow cost-of-living increases tied to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). Arizona employers must pay the higher of the state or federal minimum wage, which means most employers in the state follow the Arizona rate. The baseline non-tipped wage applies to most hours worked, with separate rules for tipped employees, training wages, and youth workers under 20. The following sections explain eligibility, scheduled increases, tipped rules, and key exemptions in plain terms.
Current Arizona Minimum Wage and Schedule
The Arizona minimum wage is adjusted annually on January 1 based on the prior year’s CPI-W inflation measure. Recent and projected changes through 2031 are listed below. Because the state law explicitly ties increases to inflation, employers are expected to follow the posted schedule unless a future legislative change alters the formula.
| Date or Period | Minimum Wage (Hourly) | Notes |
|---|---|---|
| 2024 | $14.25 | Previous year rate; adjusted annually on Jan 1 |
| January 1, 2025 | $14.80 | CPI-W-based adjustment for 2025 |
| January 1, 2026 | $15.00 | Rises to $15.00 per hour; cap on annual increases after this year under current law |
| 2027 and beyond | \nAt least $15.00, adjusted annually for CPI-W | Yearly cost-of-living adjustments apply; exact annual amounts depend on CPI-W measured over the prior year |
Key Rule: Higher of State or Federal Wage
Employers must pay whichever minimum wage is higher under state or federal law. When the federal wage is higher, employees covered by federal rules (such as those at federally contracted employers) must receive the federal rate. In most cases in Arizona, the state rate is the applicable wage because it exceeds the federal wage.
Who Is Covered and Who Is Exempt
State minimum wage rules apply to employees of enterprises that use at least $2,000 in annual business volume in goods or services (the Arizona threshold) or that are otherwise subject to the federal Fair Labor Standards Act (FLSA). Many, but not all, employers fall under these rules. Exemptions and special rules include the following broad categories:
- Tipped employees: Employers may count tips and other qualifying payments toward the minimum wage, provided total earnings meet the full minimum wage for each hour worked.
- Student learners and full-time students in retail or service roles: May be paid a percentage of the standard minimum wage within limited, clearly defined conditions.
- Small employers and certain commissioning arrangements: Specific statutory exemptions may apply, and employees paid solely on commission may have different minimum earnings requirements.
- Season and recreational establishments: Agricultural and seasonal operations can be subject to different rules during short harvest or recreational periods.
Employers may not waive these protections through agreements, and hours worked must still be compensated at the required minimum unless a valid exemption applies.
Tipped Workers and Tip Credits
A tipped employee in Arizona may be paid a direct wage below the full minimum wage if tips bring average earnings up to at least the legal minimum for each hour worked. The direct wage employers may pay to tipped workers is currently below the full state minimum and rises along with the standard wage on the same annual schedule. Tip pooling arrangements are generally allowed, but only among employees who customarily and regularly receive tips, and employers may not retain tips unless they qualify as a valid tip credit arrangement under both state and federal rules.
Training Wage Provisions
A separate training wage under Arizona law allows a lower hourly rate for employees under 20 during their first 90 consecutive calendar days of employment with an employer, subject to availability of a qualifying apprenticeship or entry-level training program. After 90 days or upon attaining age 20, whichever comes first, these employees must be paid at least the full minimum wage.
Young Workers and Special Situations
Workers under age 20 may be paid a training wage for up to 90 days. Once they turn 20, or after the 90-day period ends, they must receive the standard minimum wage. Youth employment rules may also limit hours for very young workers in certain jobs, but these limitations focus on hours and types of work rather than minimum wage rates. Employers must also provide required meal and rest breaks under state rules, and breaks of 20 minutes or less are generally considered hours worked and must be compensated accordingly.
Compliance and Enforcement
Employers are required to post a state-approved notice about minimum wage and overtime rules where employees can see it. Employees who believe they are not being paid the correct minimum wage may file a complaint with the Arizona Industrial Commission or pursue private legal action to recover unpaid wages, including back pay and certain penalties. Time limits apply to claims, so workers are encouraged to report issues promptly. Employers subject to the state law are also expected to maintain accurate payroll and time records for at least the period required by law.