Arizona Overtime Laws

March 28th 2025

In Arizona, most overtime rules go by federal standards. This guide covers Arizona’s overtime regulations, including rates, eligibility, exemptions, and legal considerations to help employers and employees understand their rights and responsibilities.

This Article Covers:

Arizona Overtime Rates

Arizona overtime is regulated by the Fair Labor Standards Act (FLSA). Any work done over 40 hours per week is considered overtime, according to FLSA.

Unlike some states that also have daily overtime regulations, Arizona does not specify daily overtime.

Hourly employees are entitled to 1.5 times their regular hourly wage for overtime work.

As a result, the overtime minimum wage in Arizona stands at $22.05 per hour, which is one and a half times higher than its regular minimum wage of $14.70 per hour.

To learn more, read our detailed article on overtime rights in Arizona.

Overtime Entitlement in Arizona

Overtime pay is required for any non-exempt employee 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 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 they can pay tipped employees a minimum of $11.70 per hour.

Overtime pay though must still be calculated based on the combined cash and tip minimum wage rate in Arizona. When a tipped employee works more than 40 hours a week, they are entitled to overtime pay at 1.5 times the full minimum wage of $14.70 per hour.

Learn more on how to calculate overtime in Arizona.

Overtime for Salaried Employees in Arizona

Many people believe that salaried employees are never eligible for overtime, but this is not always true. Some salaried employees still qualify for overtime pay, depending on their job duties and salary level.

Effective January 1, 2025, salaried employees earning less than $58,656 annually can still be entitled to overtime pay. This is according to the U.S. Department of Labor (DOL). There are still exemptions to this rule though based on an employee’s job duties.

Compensatory Time in Arizona

State and local government employees in Arizona can receive compensatory time off instead of overtime pay under certain prescribed conditions. For every extra hour worked, they get at least 1.5 hours of paid time off.

Police, fire fighters, emergency response personnel, and employees engaged in seasonal activities may accrue up to 480 hours of comp time.  Other public sector employees may accrue up to 240 hours.

Compensation for Waiting and On-Call Time in Arizona

Employers in Arizona are required to provide compensation to employees for the time they spend waiting or on-call while actively performing their duties.

Time spent in meetings, lectures, or training is considered paid work time unless all of the following apply:

  • It happens outside their regular hours
  • The employer does not require them to attend
  • It is unrelated to their job
  • They do no work during the session

In cases where an employee is dismissed before the end of a workday, they will only receive payment for the hours they actually worked.

Overtime Exemptions in Arizona

The FLSA states that salaried employees earning over $1,128 per week (equivalent to a $58,656 annual salary) are exempt from overtime pay. This includes employees in certain white-collar positions encompassing executive, administrative, or professional roles.

Further, outside sales employees, agricultural workers, drivers, and workers dealing with machinery parts and mechanics are considered exempt from overtime pay in Arizona.

Mandatory Overtime in Arizona

Neither Arizona nor federal law addresses mandatory overtime. As such, employers can require employees to work extra hours, provided they are compensated at 1.5 times their regular pay rate as required by law.

Employers can demote or remove employees who refuse to render additional work hours.

There are, however, overtime restrictions that exist for certain industries and minor workers. 

In Arizona, employees under 16 can work up to 18 hours per week during the school year, with a daily limit of 3 hours on school days. When school is not in session, they can work up to 40 hours per week, with a maximum of 8 hours per day.

Additionally, federal law restricts their working hours to between 6:00 AM and 9:30 PM on school nights and between 6:00 AM and 11:00 PM on weekends and school breaks (ARS 23-233).

Misclassifying Employees in Arizona

To be covered by the Fair Labor Standards Act (FLSA) for minimum wage and overtime pay, a worker must be classified as an employee, meaning they have an employment relationship with the employer. Independent contractors are not entitled to these protections.

Individuals are classified as employees if they are economically dependent on the contractor for their income. However, if they operate their own business and work independently, they are classified as an independent contractor. This determination is made by evaluating the overall nature of the working relationship, rather than relying on technical definitions or common law standards used in other federal laws.

Incorrectly categorizing a worker as an independent contractor to exempt them from overtime can lead to consequences, such as inadequate payment of taxes to the IRS.

Legal Cases Relating to Overtime Compensation in Arizona

Below, we present law cases relating to fair overtime compensation for employees in Arizona:

1. Arizona Correction Officers Claim Pre-shift Screenings as Overtime

In the case of Roberts v. Arizona, a group of corrections officers filed a lawsuit against the state for not compensating them for the time they spent in mandatory security screenings before starting their duties. 

They claimed that these screenings added around thirty minutes of unpaid time to their shifts. 

The trial court initially ruled in favor of the state, stating that the screenings were not eligible for compensation. However, the Supreme Court reversed this decision, stating that the question of whether the officers were entitled to overtime should be determined by the law.

Key lessons from this case:
  • Time spent in mandatory activities may be compensable. Employers should carefully evaluate whether such activities are integral and indispensable to the employee’s primary job duties and determine if they should be included in the calculation of hours worked for overtime purposes.
  • Court decisions can overturn lower court rulings. This underscores the significance of pursuing legal avenues and seeking redress when employees believe their rights to fair compensation have been violated.
  • The case emphasizes the importance of carefully analyzing the language and intent of relevant laws and regulations in determining the rights of employees and the obligations of employers.

2. Oil Rig Supervisor Entitled to Overtime Pay Due to Daily Rate Instead of Salary

In the case of Helix Energy Solutions Group, Inc. v. Hewitt, Michael Hewitt, a well-paid oil rig supervisor, filed a lawsuit against his employer, Helix Energy Solutions Group, arguing that he should be entitled to overtime pay for his long work weeks. 

Hewitt worked an average of 84 hours per week for 7 days, and he claimed that because he was paid on a daily basis, he should receive time and a half for hours worked beyond 40 hours per week under the Fair Labor Standards Act.

Helix Energy, on the other hand, argued that Hewitt, who earned $200,000 annually, was exempt from the overtime requirement as a “bonafide executive.” However, the court, in a 6-3 decision, determined that the overtime pay exemption for highly paid workers did not apply to Hewitt because he was paid a daily rate of $963 instead of a salary.

The court, in this decision, recognized that Helix’s position would have negative implications for lower-income workers who are protected by the Fair Labor Standards Act. It would essentially deprive daily workers of less than $100,000 of overtime pay.

Key lessons from this case:
  • The case highlights the importance of correctly classifying employees for overtime purposes. 
  • Employers must carefully evaluate whether employees meet the criteria for exemption from overtime pay and ensure compliance with relevant laws and regulations.
  • The court recognizes the potential negative consequences that a broad application of the overtime exemption could have on a certain group.

3. Valley Wide Plastering Construction to Pay $2.6M for Unpaid Overtime

In the Sec’y of Labor v. Valley Wide Plastering Constr. case, a federal judge in Arizona has recently issued a judgment against Valley Wide Plastering Construction Inc., ordering the company to pay $2.6 million in unpaid overtime wages to its workers. 

According to court records, the contractor failed to properly compensate employees for overtime work and also failed to maintain accurate timekeeping records between 2015 and 2022.

The court records state that employees were consistently denied their rightful overtime wages due to the company’s manipulation of time records and inadequate documentation of hours worked. 

The U.S. Labor Department has expressed its intention to pursue further legal actions and impose penalties if Valley Wide Plastering fails to fulfill its obligation of paying overtime wages.

Furthermore, the Labor Department is actively seeking current and former workers of the contractor to gather more evidence regarding the alleged withholding of overtime wages and falsification of time records.

Key lessons from this case:
  • The case highlights the importance of employers accurately calculating and compensating employees for overtime work. 
  • Employers should maintain thorough and reliable records of hours worked by employees to ensure accurate payment and comply with labor laws.
  • The involvement of the U.S. Labor Department in pursuing the case emphasizes the agency’s commitment to protecting workers’ rights and ensuring fair compensation practices.

Learn more about Arizona Labor Laws through our detailed guide.

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.