labor law guide
The Arizona employment laws every business owner should know
Wages and breaks
Employees who receive tips may be paid a cash wage of $3.00 an hour less than the minimum wage if the cash wage and tips total at least the state minimum wage.
Employers in the 9th Circuit, which includes the state of Arizona, may not require or coerce employees who customarily receive tips to share those tips with those who do not, such as “back of house” employees like kitchen workers, managers, and janitors.
Arizona does not have any wage and hour laws governing overtime requirement. However, the Fair Labor Standards Act always applies and requires that non-exempt employees be paid 1.5 times their regular rate of pay for all hours worked over 40 in a workweek.
The federal overtime rule stipulates that the minimum salary requirement for administrative, professional, and executive exemptions is $684 per week, or $35,568 per year. Workers making at least this salary level may be eligible for overtime based on their job duties.
Arizona does not have any laws requiring employers to provide meal breaks or lunch periods.
The US Department of Labor does not require employers to provide meal periods or breaks, but if they do, breaks less than 20 minutes must be paid.
Meal periods, usually 30 minutes or longer, do not need to be paid if the employee is free to do as they wish during the break.
Arizona does not require employers to provide rest breaks.
If they do, breaks less than 20 minutes must be paid.
Final paychecks in Arizona
Employers must pay terminated or laid off employees their final paycheck within 7 days or by the next payday, whichever comes first.
Employees who resign or are suspended must be paid their final paycheck by the next scheduled payday.
Arizona child labor laws
Youth who are 14 and 15 years of age must obtain an Eligibility to Work Form from the Alabama Department of Labor to work for an employer. Employers must also obtain a Class I Child Labor Certificate.
When school is in session, employees who are 14 and 15 years of age may not work for more than 6 days in a school week, hours worked per week cannot be more than 18, and they cannot work more than 8 hours on a non-school day, more than 3 hours on a school day, or before 7 a.m. or after 7 p.m.
When school is not in session, employees who are 14 and 15 years of age may not work for more than 6 days in a workweek, the number of hours worked in a workweek cannot exceed 40 hours, and they cannot work before 7 a.m. and after 9 p.m.
Any establishment that serves alcohol is prohibited from employing anyone under the age of 16, unless the establishment is owned and operated by the youth’s immediate family. In that case, the youth may work in the establishment as long as they are not serving alcohol.
All employers are required to provide paid sick leave to employees. The Industrial Commission of Arizona has provided extensive FAQs, which can be located here.
Arizona has no state laws regarding medical and family leave, but employers may be required to provide leave in accordance with the federal Family and Medical Leave Act.
Employers are not required to provide bereavement leave, but may be required to comply with any bereavement policy they may have.
Employers are not required to provide vacation leave but must comply with their own established policies if they choose to implement one.
Employers can implement a “use-it-or-lose-it” policy that requires employees to use their vacation time by a set date, as long as employees have reasonable time to use their vacation time.
The amount of vacation time an employee can accrue may be capped by the employer.
Private employers are not required to provide paid or unpaid holiday leave, but must comply with any established policies if they choose to implement them.
Employers must provide paid time off to vote in primary and general elections as long as the employee provides notice prior to election day.
Employers must only provide enough paid leave for the employee to have 3 hours to vote between either the opening of polls and the start of their shift or the end of their shift and the closing of the polls.
Employers may specify when an employee can take time off to vote.
Employers do not have to pay employees for time spent responding to a jury summons, but employers may not require employees to use any available leave for responding to a jury summons.
Employees cannot lose seniority while serving as a juror.
The federal Uniformed Services Employment and Reemployment Rights Act (USERRA) is applicable to all employers in the United States.
Employers that have at least 50 employees must provide leave to an employee who is the victim of a juvenile offense or crime.
The employee may use the leave to participate in a proceeding or to obtain a protective order, an injunction against harassment, or any other type of order to help ensure the health, safety, or welfare of the victim or the victim’s child.
The employer may require or the employee may choose to use accrued paid vacation, personal leave, or sick leave. An employer may not discharge or discriminate against an employee who takes crime-victim leave.
The employer may require that the employee provide certain documentation supporting their need for leave. All records must be kept confidential.
Hiring and firing
Federal law makes it illegal for an employer to discriminate on the basis of: Race, Color, Age, Sex, Sexual orientation, Gender, Gender identity, Religion, National origin, Pregnancy, Genetic information, including family medical history, Physical or mental disability, Child or spousal support withholding, Military or veteran status, Citizenship and/or immigration status.
Arizona law prohibits discrimination based on AIDS/HIV status.
Click here to read our blog on what acceptable and unacceptable questions to ask during an interview.
Arizona is an employment-at-will state, which means that without a written employee contract, employees can be terminated for any reason at any time, provided that the reason is not discriminatory and that the employer is not retaliating against the employee for a rightful action.
Regarding employment and payroll data, under the Fair Labor Standards Act (FLSA) and others, you must:
For at least 3 years: keep payroll records, certificates, agreements, notices, collective bargaining agreements, employment contracts, and sales and purchase records. Also keep completed copies of each employee’s I-9 for three years after they are hired. If the employee works longer than three years, hold on to the form for at least one year after the employee leaves.
For at least 2 years: Keep basic employment and earning records like timecards, wage-rate tables, shipping and billing records, and records of additions to or deductions from wages. Also keep the records that show why you may pay different wages to employees of different sexes, such as wage rates, job evaluations, seniority and merit systems, and collective bargaining agreements.
For at least 1 year: The Equal Employment Opportunity Commission says employers should keep all employment records for at least one year from the employee’s date of termination.
Other record-keeping laws that may apply to you:
Under the Occupational Safety and Health Act, you need to keep records of job-related injuries and illnesses for five years. But some records, like those covering toxic substance exposure, have to be kept for 30 years.
You must keep files of benefit plans and seniority and merit systems while they are in effect and for at least a year after they end. You must also retain summary descriptions and annual reports of benefits plans for six years.
If your company is covered by the Family and Medical Leave Act, you must also retain relevant records of leaves, notices, policies, and more for three years.
Additional laws that may apply to you.
Employers are generally protected from lawsuits related to drug or alcohol testing if they follow an extensive list of guidelines, which can be found here.
Employers may not discriminate against an applicant or employee because they are a registered cardholder for or use medical marijuana, unless he or she is applying for a safety-sensitive position, the employer would lose funding or their licensing under federal law, or the employee or applicant used, possessed, or was impaired by marijuana on the worksite or during hours of employment.
Employers in Arizona may not discharge, discriminate, or retaliate against an employee for opposing or reporting a violation of state law. An employee is protected as long as they have a reasonable belief that the law was violated and they report it either to a manager or to a public agency.
In addition, public employees, including school personnel, are protected for reporting concerns in writing regarding a violation of the law, mismanagement, gross waste of monies, or abuse of authority.
COBRA is a federal law that allows many employees to continue their health insurance benefits after their employment ends. Because federal COBRA only applies to employers that have 20 or more employees, many states have adopted their own versions of the law, which are known as “mini-COBRAs.”
Arizona has a limited mini-COBRA, which allows an employee’s spouse or dependent children to continue their coverage for disability insurance. The disability insurance policy must contain a notice of the right to continue coverage. We recommend that employers inform an employee of their COBRA rights as soon as a triggering event occurs.
Arizona requires that employers conduct background checks (by requiring applicants or new employees to obtain a fingerprint clearance card) for the following types of employees or volunteers: Teachers and certain school personnel; School bus drivers; Those working in a residential healthcare facility, nursing care facility, or a home health agency; Childcare personnel; Children’s behavioral health program personnel; Those who provide services directly to juveniles or vulnerable adults; Those working for a domestic violence shelter, an organization that advocates for domestic violence victims, or an organization that provides support services for domestic violence victims; Taxi, livery vehicle, and limousine drivers.
Employers in Arizona may obtain credit reports on applicants and employees. However, if they take an adverse action against the applicant or employee based on the report, they must tell them of the name and address of any credit reporting agency that provided the report.
Arizona does not have a law that prohibits employers from asking job applicants about criminal histories. However, the Arizona Attorney General has issued a Guide to Pre-Employment Inquiries. The guide indicates that applicants may be asked about prior convictions, but if employers choose to make that inquiry, they must include a statement that conviction will not be an absolute bar to employment.
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View the resources available to Arizona business owners in our state-by-state COVID-19 Resource Center.
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This summary is not qualified legal advice. Laws are always subject to change, and they can vary from municipality to municipality. It’s up to you to make sure you’re compliant with all laws and statutes in your area. If you need more compliance help, we recommend consulting with a qualified lawyer, checking with your local government agencies, or signing up for Homebase to get help from our certified HR Pros.