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Running an efficient workforce requires more than assembling a team of hardworking experts skilled at their job roles. It also calls for a structure of rules that protect the employer and serve as guidelines to safeguard employees’ interests. This structure of rules often comes in the form of state laws and directives.
Arizona, also fondly known as The Copper State, follows in the footsteps of many other states, with rules that guide the employer-employee relationship, ensuring fairness, and delineating the rights and responsibilities of both parties. These state-specific laws dictate every facet of employment and labour, protecting both parties’ rights.
As an employer in Arizona, navigating the intricacies of Arizona labor laws, and U.S. labor laws in general, ensures that you avoid the fines, penalties, and possible lawsuits that are a result of not being compliant with the law.
This article is part of a 50-part series that explores state-specific laws in America, focused on helping every employer in Arizona understand labour laws in employee operation and ensuring employees within the state remain aware of their rights.
Meals And Breaks in Arizona
When it comes to employee meal breaks, no state-specific law in Arizona mandates an employer to provide breaks to employees. However, if an employer chooses to provide a meal period or break, they can do so on their own preference.
In the absence of a state-specific law, federal law applies – this rule does not require the provision of a break.
However, the US Department of Labor provides guidelines stating employers must pay for all breaks under 20 minutes. On the contrary, any break exceeding 30 minutes is typically unpaid so long as the employee is free to do what they want with their time. If the employee is required to remain at their post during their break, then the break must be paid for.
Below is a short video for understanding workers’ rights in Arizona:
Leave and Paid Time Off (PTO) in Arizona
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💡Did You Know?
Leave and PTO in Arizona offer employees much-needed time to cool off from being productive at work. This fosters an efficient work environment without burnout and communicates to employees that taking time off is crucial.
Regarding leave and PTO in Arizona, the available options are split into required and non-required leave. However, the state has no set laws for both required and optional leave, leaving the provision of these leave to the employer’s discretion.
However, employers are typically required to establish leave policies and clearly state these policies in employee contracts. The video below should explain Arizona’s current laws on paid leave and minimum wage – it’s quite long, so feel free to bookmark and revisit:
Required Leave in Arizona
Employers in Arizona are required by law to provide their employees with certain types of leaves.
Sick and Family Leave
Since 2016, employers have been required to provide paid sick leave to employees. This leave can be used in any illness-related case, be it for the employers themselves or for their close family members. Some reasons an employee might seek a sick and family leave include:
- Caring for a family member with physical or mental illness
- Recovery from injuries
- Psychological counseling
The state law states that employees can earn paid sick leave, also called sick leave accrual. This pay is accumulated if:
- The business has over 15 employees. Employees earn one hour of paid sick leave for every 30 hours worked, earning up to 40 hours of paid sick leave per year.
- If the business has fewer than 15 employees. Employees earn one hour of paid sick leave for every 30 hours worked, earning up to 24 hours of paid sick leave per year.
Jury Duty Leave
In cases where an employee is summoned to serve a jury or subpoenaed as a witness on a court case, employers must not penalize the employee for taking time off. However, the employer is also not required to pay for an employee’s leave for jury duty summons.
If the subpoenaed employee works in a company with 5 or fewer full-time employees, the court might choose to postpone their jury duty service if another employee in the same company is already serving jury duty.
Voting Time Leave
In the event of an election, an employer must provide employees with paid leave to vote. However, employees are required to request this leave before election day.
Additionally, all employees should get 3 consecutive hours to vote between the opening and closing hours of the polls. The voting paid leave can be used flexibly.
Domestic Violence or Sexual Assault Leave
An employer with 50 or more employees is obligated to provide unpaid leave to employees who are victims of domestic violence, sexual assault, or stalking.
The state of Arizona does not provide paid or unpaid leave for victimized employees to recover from physical or mental injuries, only legal proceedings. However, in some cases, the Family Medical Leave Act (FMLA) may override an employer’s decision, as it provides job-protected time off for a wider range of circumstances and injuries.
The two criteria for this kind of leave are:
- The employee needs to be present at criminal proceedings (sentencing, probation, initial court appearances, etc).
- The employee wants to obtain an order of protection against harassment.
Organ and Bone Donation Leave
For state employees who want to donate bone marrow, employers must provide 5 days of paid leave for bone marrow donation, with verified documentation that the employee is a donor.
For employees who want to donate an organ, the employer must provide 30 days of paid leave, with verified documentation that the employer is a donor.
Military Leave
The State of Arizona’s military leave law requires an employer to approve military leave in the public and private sector for National Guard and Military Reserve Components members.
Arizona, like all states in the US, abides by the federal Uniformed Services Employment and Reemployment Rights Act (USERRA), that states employers are required to allow employees to return to their jobs after military service without loss of vacation days, seniority, or potential promotions.
Arizona Non-Required Leave
There are several leaves employers in Arizona are not required to provide employees but may do so regardless as a sign of goodwill. These leave include:
Holiday Leave
Private employers are not legally required to provide paid or unpaid holiday leave as Arizona lacks regulations concerning paid or unpaid leave. However, they must comply with any established policies concerning these leaves when implemented.
Consequently, a private company can ask employees to work holidays without premium pay (higher pay for being on duty during the holidays). The only exception is if the employment falls under the Fair Labor Standard Act (FLSA) and is eligible for overtime pay in these cases. Conversely, public offices must be closed on all legal holidays Arizona recognizes.
Here is a quick overview of all holidays recognized in Arizona:
- New Year’s Day; January 1
- Martin Luther King Jr. Day; Third Monday in January
- Presidents’ Day; Third Monday in February
- Memorial Day; Last Monday in May
- Independence Day; July 1
- Labor Day; First Monday in September
- Columbus Day; Second Monday in October
- Veterans Day; November 11
- Thanksgiving Day; Fourth Thursday in November
- Day after Thanksgiving; Fourth Friday in November
- Christmas Day; December 25
Vacation Leave
Arizona has no specific regulation that requires employers to provide employees with vacation benefits, whether paid or unpaid. This allows employers to set terms and benefits that suit their organizational objectives.
The lack of state-specific laws means that each company will have its own rules about leave and PTO unique to the organization. However, if an employer provides vacation benefits, it must be stated in employee contracts.
- Employers may choose to implement a “use-it-or-lose-it” policy that requires employees to use their vacation by a set date or risk losing it, as long as employees have a reasonable opportunity to utilize the leave.
- Employers may also decide to implement a policy that caps the amount of vacation leave an employee can accumulate over a period of time.
- Employers can introduce a policy that denies payment for vacation leave when an employee leaves the company or is terminated
- Unless the company has a policy specifying payouts of vacation leave upon termination, employers are in no way legally obligated to provide them.
Bereavement Leave
The State of Arizona doesn’t offer paid or unpaid leave for bereavement, but employers may decide to provide a benefit. If the employer does, the conditions must comply with existing company policy.
Overtime Regulations in Arizona
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💡Did You Know?
There are no laws governing the payment of overtime in Arizona. Hence, Federal overtime laws apply in the state.
Federal laws under the Fair Labor Standards Act (FLSA) state that employees are eligible for overtime if they work more than 40 hours per week unless otherwise exempt. The standard overtime pay is 1.5 times the regular pay.
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 much income may be eligible for overtime based on their job duties.
By the FLSA’s standard, workers paid $20 an hour will receive $30 an hour for overtime.
Non-compliance with these overtime work laws often comes with severe penalties ranging from hefty fines to lawsuits. It’s important to keep accurate track of work hours and pay to avoid these.
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Wages and Benefits in Arizona
Standard minimum wage
$13.85
Tipped minimum wage
$10.85
Arizona’s minimum wage is currently $13.85. This is slated to increase to $14.35 an hour effective January 1, 2024, and continue increasing yearly based on the increase in costs of living from the previous year.
Employees who make tips as part of their earnings may be paid a cash wage of $3.00 an hour less than the minimum wage so long as the cash wage and the extra tips combine to reach the state’s minimum wage – that is, tipped employees are expected to earn at least $3 per hour in tips based on this adjusted minimum.
Additionally, 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 the house” employees like kitchen workers, managers, and janitors.
Pay Frequency
An employer in Arizona must designate two or more days each month, not more than sixteen days apart, as fixed paydays except in limited circumstances.
Employers may pay employees their standard wages at a different time than they pay overtime wages and exception pay.
Employers may satisfy the requirement to pay employees – except for school district employees or persons employed by employee leasing firms that contract with school districts – all their standard wages due by:
- Personally delivering the wages to the employee no later than five (5) business days after the end of the pay period.
- Placing the wages in United States mail no later than five (5) business days after the end of the pay period, to be delivered to addresses designated by the employee.
- Personally delivering the wages to the employee no later than ten (10) days after the end of the most recent pay period, if the employer’s payroll system is centralized outside of Arizona.
- Employers are required to pay overtime wages and/or exception pay within sixteen (16) days of the end of the pay period. An employer paying with cash or check and whose payroll system is centralized outside of Arizona must pay employees within 10 days of the end of the pay period.
Additionally
- Employers are required by law to provide employees paid by payroll card a written or electronic statement of their earnings and withholdings for each deposit.
- Employers must pay terminated or laid-off employees their final paycheck within 7 days of termination, or by the next payday, depending on which comes first.
- Employees who resign or are suspended must be paid their final paycheck by the next scheduled payday.
Prevailing Wages in Arizona
Arizona lacks a state-ordered prevailing wage law. However, when federal funding is involved in the public works construction project, Davis-Bacon Act requirements may apply.
The Davis-Bacon and Related Acts apply to contractors and subcontractors performing on federally funded or assisted contracts over \$2,000 for the construction, alteration, or repair (including painting and decorating) of public buildings or public works.
The law states that contractors and subcontractors must pay their laborers and mechanics employed under the contract no less than the locally prevailing wages and fringe benefits for corresponding work on similar projects in the area.
In some cases, the prevailing wage rates may differ from the state’s standard minimum wages.
For employers seeking more information for compliance with the prevailing wages law in Arizona, check the following sites for more information about prevailing wages:
Hiring Practices in Arizona
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💡Did You Know?
Arizona hiring laws uphold fairness in the employment process, beginning with job postings. The state prohibits discrimination based on race, color, religion, sex, age, national origin, disability, or genetic testing results.
Drug Testing
Employers are protected from lawsuits related to drug and alcohol testing if they follow certain strict guidelines. These guidelines set out extensive requirements for documentation, provision, and/or protections related to drug tests:
- A statement of the employer's policy respecting drug and alcohol use by employees.
- A description of those employees or prospective employees subject to testing.
- The circumstances under which testing may be required.
- The substances as to which testing may be required.
- A description of the testing methods and collection procedures to be used.
- The consequences of a refusal to participate in the testing.
- Any adverse personnel action that may be taken based on the testing procedure or results.
- The right of an employee, on request, to obtain the written test results.
- The right of an employee, on request, to explain in a confidential setting, a positive test result.
- A statement of the employer's policy regarding the confidentiality of the test results.
Additionally, employers are not allowed to discriminate against an applicant or employee because they are a registered cardholder for and/or use medical marijuana unless he or she is applying for a safety-sensitive position.
Background Checks
Arizona mandates employers to carry out background checks for certain types of employees by requiring these employees to obtain a fingerprint clearance card. The following types of employees that must undergo a background check include:
- Teachers and certain school personnel
- School bus drivers
- Employees working in a residential healthcare facility
- Nursing care facility employees
- Home health agency employees
- Childcare personnel
- Children’s behavioral health program personnel
- Employees who provide services directly to juveniles or vulnerable adults
- Employees working for a domestic violence shelter
- Employees working for organizations that advocate for domestic violence victims
- Taxi, livery vehicle, and limousine drivers
Equal Employment Opportunities
Arizona upholds the law of equal opportunities, prohibiting job discrimination based on race, color, religion, sex or national origin, to ensure equality of opportunity in all aspects of employment.
Health and Safety Standards in Arizona
The Arizona Division of Occupational Safety and Health (ADOSH) enforces state laws and regulations regarding workplace safety and health.
ADOSH operates under the Occupational Safety and Health Act (OSHA) which covers federal workplace safety and health requirements. This act requires employers to provide a safe working environment, and ADOSH ensures compliance with OSHA standards.
To report unsafe working conditions, employees can contact ADOSH directly or use the online reporting tool available on the Arizona Department of Economic Security website.
Employers can also access resources on the ADOSH website to stay informed about safety regulations and best practices to ensure a secure workplace. Regular training and communication on safety protocols are essential to maintain compliance and protect the well-being of employees.
Child Labor Laws in Arizona
Child labor laws in Arizona are enacted to protect the rights and prevent the exploitation of minors or children below the legal age limit.
Minors aged 14 and 15 are generally allowed to work in certain non-hazardous jobs, but they require a work permit issued by their school. Work hours for 14- and 15-year-olds are limited, with restrictions on late-night and early-morning shifts.
Minors aged 16 and 17 don’t need work permits but must adhere to hour limitations during school days. There are also restrictions on hazardous occupations for all minors. It’s important for employers to be aware of these regulations to ensure compliance and the well-being of young workers.
In Arizona, no child or minor under sixteen can work more than three hours on a school day when enrolled on a day when school is in session, or more than eight hours on a non-school day, for a total of eighteen hours per week.
Additionally, no minor under sixteen can work before 6:00 a.m. or after 9:30 p.m. when there is school the next day. However, when there is no school the next day, minors can work until 11:00 p.m.
When school is not in session or when the child is not enrolled in school, minors under sixteen can work eight hours per day for a total of forty hours per week. However, they can not work before 6:00 a.m. or after 11:00 p.m. when school is not in session, or when the person is not enrolled.
The law also prevents minors from being employed in solicitation sales or door-to-door solicitation past 7:00 p.m.
Generally, the state allows youths 16 and 17 years old to work in a wide range of jobs. However, they cannot work in organizations that:
- Manufacture or store explosives (except retail establishments where the child does not directly handle explosives)
- Sell or manufacture ammunition
- Provide mine or quarry occupations
- Deal with wood logging
- Provide construction services
- Deal with boiler, furnace, or engine rooms
- Deal with food processing
- Provide laundering services
Additionally, youths are not allowed to work in occupations that require handling machinery like power tools and vehicles, exposure to radioactive substances, or slaughtering of meat.
Arizona child labor laws exempt the following youth from its minimum age requirements for hazardous occupations:
- Children employed by their relatives (parent, grandparent, aunt, etc.)
- Those who work as child performers in film, theater, radio, or television
- Those enrolled in career education programs
- Those enrolled in vocational or technical training school programs.
Employee Termination and Resignation in Arizona
Arizona operates under at-will employment, which means an employer can fire the employee at any time, and an employee can choose to quit at any time.
However, while employees can be terminated for no reason, employers must ensure the reason is not discriminatory and not a retaliatory action against the employee.
Following termination, employers must pay the 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.
While there’s generally no statutory requirement for notice of termination, employers and employees may have contractual agreements specifying notice periods. Severance pay is typically not mandated by state law unless it’s part of an employment contract.
Right-To-Work Law
Arizona is a right-to-work state, meaning employees cannot be compelled to join or support a union as a condition of employment. Employers need to be familiar with both state and federal employment laws to ensure compliance when handling terminations or resignations.
Unemployment Benefits In Arizona
Unemployment insurance benefits provide temporary financial assistance to workers unemployed through no fault of their own that meets Arizona’s eligibility requirements.
To be eligible for unemployment benefits in Arizona, you must be a resident of the state and meet the following criteria:
- Be unemployed;
- Have worked in Arizona during the past 12 months (this period may be longer in some cases);
- Earned a minimum amount of wages determined by Arizona guidelines; and are
- Actively seeking work each week you are collecting benefits
To apply for an unemployment insurance claim online, visit the Arizona Department of Economic Security website. You can also visit the Employment Administration’s website for more information.
Sometimes, an employer may need to navigate the intricacies of employee benefits, performing actions like responding to unemployment claims, contesting benefit charges, and other aspects of the employer’s involvement in the unemployment insurance system.
To understand the law and its processes, employers can find resources and guidelines on the Arizona DES website to understand their role in the unemployment benefits process.
Penalties for Noncompliance in Arizona
Labor law violations in Arizona often come with several penalties. The penalty varies with the severity of the crime.
Some penalties for noncompliance in Arizona include:
- Employers that intentionally or repeatedly violate minimum wage or overtime pay requirements may face civil penalties of up to $1,000 per violation
- Willful FLSA violations can lead to criminal prosecution with fines up to $10,000. A second conviction may result in imprisonment
- An employer who violates a child labor law may receive a cease and desist that will include a civil penalty of $1,000
- An OSHA violation can attract up to \$15,625 per violation, with a willful or repeated violation attracting up to \$156,259 per violation
Enforcement mechanisms include investigations initiated by complaints from employees, competitors, or the public. Violations can be reported to the Arizona Division of Labor by filing a complaint online or contacting their office directly. The division has the authority to conduct audits and inspections to ensure compliance.
Employers should stay informed about labor laws and maintain compliance to avoid potential penalties and ensure fair and lawful practices in the workplace.
Other Essential Information About Labor Laws in Arizona
Some other important labor laws every employer should be aware of includes:
Recordkeeping Laws
Employers must retain the following employment and payroll data for periods as given under the Fair Labor Standards Act (FLSA):
- 1+ year: Benefit plans and seniority/merit systems documents for at least a year after they end.
- 2 years: Basic employment and earning records like timecards, wage-rate tables, shipping and billing records, records of additions to or deductions from wages, records showing why you may pay different wages to employees of different sexes, seniority and merit systems documentation, and collective bargaining agreements
- 3 years: Payroll records, certificates, agreements, notices, collective bargaining agreements, employment contracts, sales and purchase records, and completed copies of each employee’s I-9 for three years after they are hired or one year after they leave the company, whichever comes later
- 5 years: Records of job-related injuries and illnesses for five years (some records, like those covering toxic substance exposure, must be kept for 30 years)
- 6 years: Summary descriptions and annual reports of benefits plans
COBRA Laws
COBRA is a federal law that allows many employees to continue their health insurance benefits after their employment ends. Arizona operates on a limited Mini-COBRA that 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.
Arizona Credit And Investigative Check Laws
Employers in Arizona may obtain credit reports on applicants and employees. However, if they take 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.
Labor Unions and Collective Bargaining
Arizona allows both public and private sector employees to unionize. While the state does not have specific laws governing collective bargaining for private-sector employees, public-sector employees may engage in collective bargaining.
The Bottom Line on Arizona Labor Laws
Arizona’s labor laws play a pivotal role in shaping the dynamics of the workforce, impacting both employers and employees alike. From minimum wage standards to regulations governing breaks and overtime, a comprehensive understanding of these laws is essential for maintaining a fair and lawful work environment.
Employers bear the responsibility of compliance, ensuring that their policies align with the state’s regulations. Likewise, employees should be aware of their rights, fostering a culture of transparency and mutual respect. For both parties, staying abreast of labor laws remains paramount for cultivating a workplace that prioritizes equity, productivity, and employee well-being in Arizona.
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