Things Employers Should Know About Overtime Laws

The stage wage laws in Arizona follow federal laws in many respects. However, if you look at the state laws, you will notice that the laws laid down here are far more favorable to the workers than the federal laws.

The state laws have better coverage over certain areas, like providing a better value for their services in the form of the minimum wage, followed by the extended statute of the limitations related to the minimum wage violations, and also, they cover the potential for the employees in terms of recovering the triple damages related to the claims for unpaid overtime wages. However, federal laws allow for regulations related to double damages.

Rules Regarding Overtime Minimum Wage

In simple terms, these laws mean that Arizona employers should pay all eligible working class employees overtime. There are classifications for working professionals that make them eligible for the payment. However, the decisions regarding eligibility should not and, in no case, can override the laws related to federal overtime rules.

Mandatory overtime is legal based on the ongoing rules related to the laws. So, as an employer, if you require your on-board professionals to work for more than 40 hours weekly, the overtime pay for extra hours that the employer should pay an employee works. Also, if someone has signed a contract related to the limited number of hours on the professional front, mandatory overtime might not be required.

Regulations In Arizona

The overtime laws have been in talks for a long time. In November 2016, the legislation passed Proposition 206, which allowed an increase in the Arizona minimum wage rate. The increase was $10 for one hour. It became effective on January 1, 2017.

However, as per the rising expenditure and cost of living, there has been a rise in the rates. In 2021, the hourly amount stood at $12.15. The amount experienced an increase and reached $12.80 in 2024.

As a working person, if you are claiming a tip credit, the payment may be up to $3 hourly less than the stipulated minimum wage. It is for the working professionals who get regular tips from the customers. It comes in addition to the fact that the total amount of tips and wages should be at least the minimum wage that has been set.

However, there are some categories of various people that do not fall under the minimum wage scheme, which are mentioned as follows:

  • The professionals who are working for their sibling or their parent.
  • The professionals are indulging in private services like babysitting in their employer’s home. Also, if they are casually indulging in such jobs, the minimum wage rate won’t apply.
  • The government employees are employed by the Arizona state or the United States.

Salaried Vs. Non-Salaried Employees

If you have a basic understanding of overtime laws, you should know that salaried employees are often exempted from getting overtime pay. There is a three-pronged test that has been revised for the determination of whether a salaried employee is entitled to this payment or not.

The exempted people should be paid a minimum of $23,600 annually. They will also receive a salary and be entitled to overtime pay. Also, salaried employees have to perform certain of the exempted job duties. However, if an employee fails to meet this criterion, overtime pay should be done regardless of whether they are paid their salary.

Arizona Overtime Laws fall under the governance of federal policy. If you are running any business and have salaried employees working, they can be divided into three categories to understand whether they fall into the overtime category.

If you are paying your on-board profesionals hourly, this does not fall into the definition of salary. So, all the employees should receive overtime pay.

Every year, a set number of dollars are exempted in terms of the payment received by an employee getting the salary from getting the overtime payment. The bar is set, and if any employee takes the salary and earns less than the set amount, they will be eligible to gain overtime. Also, as an employer, you should follow federal law and check whether the employees are making $12.80 hourly or not.

Employee Classification

Any work that an employee does impacts overtime eligibility. Hence, it is essential to classify the employees so that, as an employer, you have clarity on whether your employee is eligible for the same.

Certain professionals will be exempted from the overtime pay requirements that are as follows:

  • Administrative jobs
  • High-profile hobs
  • Jobs that require knowledge and indispensable decisiveness
  • Teaching professionals
  • C-suite executives
  • Legal professionals

You still stand a chance of paying the overtime payments to the employees in Arizona. However, it won’t be the usual course. Instead, it can be done in a bonus and other forms like a lump sum. These ways are recognized for employee payments but must be qualified as a time-and-a-half payment technique. It will, however, stay outside the federal law demands. But, you should note that the exempt employees are not technically owed the payment for overtime.

Overtime Pay Myths

You may be having a hard time understanding these laws. It is because the changes can happen yearly, with changes in the state and the kind of business an employer is running. Here are some myths that you need to know:

  • Any salaried person will always have an exception from overtime pay.
  • Job titles can impact the eligibility of a person for overtime pay.
  • The employees have the discretion of selecting the non-exemption option from this payment.

The reality differs from these myths, as salaried employees can get paid based on their job title and wage. Also, more than your job title, it is the job duties are the ones that determine their eligibility. Also, business owners enjoy accountability for employee compensation. The person taking the salary does not have any discretion for status selection.


As an employer and employees, all groups need to understand Arizona’s overtime laws. They are a part of the governmental scheme. When you have clarity, you can decide the forthcoming things accordingly. It will be beneficial for both parties.