Employment law aims to protect employees from discrimination and hazardous work environments. If employers violate these laws, they can face serious repercussions—and there’s a lot to keep track of. US labor and employment laws are a mix of constantly changing federal, state, and even municipal regulations.
Compared to other states, Arizona scores high marks for being worker-friendly, and has additional protections for pregnant employees. If you’re hiring in the state of Arizona—whether in Phoenix, Tucson, or Flagstaff—it’s important to understand and comply with the state’s specific laws.
Don’t want to leave compliance with Arizona’s labor regulations to chance? Scale your enterprise faster by letting Rippling’s Professional Employer Organization service handle your tax registration and management.
Employment vs. labor law: What’s the difference?
While employment and labor law share some similarities, the terms have legally different meanings. The difference between the two depends on who is involved. If it’s a matter concerning the relationship between an employer and an individual, it’s generally considered to fall under employment law. If the matter is between an employer and a group of workers, such as unions, then it’s an issue of labor law.
Here’s an easy way to tell the difference between the two terms:
- Employment law covers areas like hours, wages, overtime, hiring practices, workplace discrimination, and retaliation against workers.
- Labor law is the part of employment law that encompasses union membership, union dues, and collective bargaining agreements.
Wages and hours in Arizona
Arizona’s minimum wage rate is higher than the federal minimum and that of many other states. However, because Arizona has not adopted pay transparency legislation, employers are not required to disclose salary or wage information. This can make it harder to root out cases of pay inequity.
Minimum wage laws in Arizona
Arizona’s Fair Wages and Healthy Families Act (Proposition 206) sets the state’s minimum wage and earned paid sick time requirements.
Arizona’s minimum wage for 2023 is $13.85 per hour, which is notably higher than the federal minimum wage of $7.25. Exceptions include workers who are employed by a parent or sibling, babysitters, and government employees. The minimum wage for tipped employees is $10.85 per hour. Tips must make up the $3 per hour difference.
When establishing hourly pay rates for employees, Rippling identifies minimum wage violations in accordance with state regulations where the employees are located. This makes it easy to ensure compliance with Arizona’s higher minimum wages.
Overtime pay in Arizona
Sometimes, a big project takes longer to complete than initially anticipated and employees have to work extra hours to save the day. When this happens, employers in Arizona have to pay overtime for those extra hours unless the employees fall under an exemption. Exempt workers include executives, agricultural workers, and outside salespeople.
The federal Fair Labor Standards Act (FLSA) sets Arizona's overtime rate. The current rate is 1.5 times the employee’s regular pay rate for hours in excess of 40 hours in a single workweek. The FLSA defines a workweek as a 168-hour period during seven consecutive 24-hour periods. An employer may choose to have the workweek start on any day of the week and at any hour.
To comply with Arizona’s overtime laws, Rippling’s payroll software automatically applies the appropriate pay rates when an employee’s hours trigger the requirement for overtime pay.
In addition to the state minimum wage, localities can set an even higher minimum. For example, the minimum wage in Flagstaff is $16.80 and the tipped wage is $14.80.
Breaks and rest periods in Arizona
Arizona does not require employers to provide rest periods or meal breaks. If the employer does provide a break of under 20 minutes, federal law requires it to be paid. Meal breaks of more than 30 minutes (if the employee is not working) do not have to be paid.
Leaves of absence in Arizona
There are times when employees need time off to deal with personal situations. This could be to undergo medical treatment, recover from an illness, or take care of a family member. The last thing they need to be worried about is work, which is why there are regulations in place to protect Arizona workers until they’re ready to return.
Employers in Arizona must comply with the federal Family Medical Leave Act (FMLA), which allows many employees to take unpaid time off without putting their jobs in jeopardy. For FMLA eligibility, an employee must:
- Have worked for a covered employer for 12 months, although this does not have to be consecutive
- Have worked 1,250 hours during the 12 months before their leave date
- Work at a place where the employer has 50+ employees within 75 miles
Once these qualifications are met, employees have the right to take 12 weeks of unpaid leave per year. This leave can be used for the following:
- Medical leave when the employee is unable to work due to a serious health condition
- Care for an employee’s child, spouse, or parent who has a serious health condition
- The birth, adoption, or foster care placement of a child
- Qualifying military reasons
Upon the conclusion of an employee's FMLA leave, they are entitled to reinstatement in either the same or a comparable job.
Pregnancy disability leave in Arizona
There is no state legislation covering pregnancy disability leave in Arizona. However, if they qualify (see above), the employee may be able to take unpaid leave under the federal Family Medical Leave Act. The FMLA gives workers up to 12 weeks of unpaid leave in a 12-month period that can be used for medical reasons or to care for a newborn.
Paid sick leave in Arizona
Arizona's Paid Sick Leave Law is part of the Fair Wages and Healthy Families Act. Under this law, employees accrue paid sick leave that they can use to care for themselves or family members. The law covers all Arizona employers except for state or federal government workers.
The accrued sick leave can be used for:
- General medical care, injury, or illness
- Situations arising from a public health emergency
- Domestic or sexual violence, abuse, or stalking
The amount of sick leave employees can accrue depends on the size of their employer. Employers with 15 or more employees accrue one hour for every 30 hours worked, for a maximum of 40 hours per year. Employers with less than 15 employees accrue one hour for every 30 hours worked, for a maximum of 24 hours per year. In both cases, additional time can be agreed to by the employee and employer.
New employees may have to wait 90 days before taking sick leave. After that period is over, employees are protected from retaliation if they claim their paid sick time rights.
Rippling allows you to customize and automate your leave policy, letting you see how employees use it.
Workplace safety in Arizona
Employers must ensure their employees’ safety by providing safe equipment, training, and company-wide safety protocols.
Workplace safety in Arizona is governed by the Arizona Division of Occupational Safety and Health (ADOSH), which is based on Occupational Safety and Health Administration (OSHA) regulations. The Industrial Commission of Arizona administers Arizona’s state laws. ADOSH is authorized to conduct unscheduled workplace inspections and issue citations for non-compliance. They also offer training on workplace safety.
ADOSH covers all public and private sector workplaces in Arizona, with some exceptions. Federal government workers, private sector maritime, and employment on Indian Lands (to name a few) are subject to federal jurisdiction.
In addition to OSHA, ADOSH has its own standards in several areas:
- General industry
- Compressed gas and air
- Commercial driving
- Fall protection
- Field sanitation
In some states, an Injury and Illness Prevention Program (IIPP) or safety committee is required. This isn’t the case in Arizona, but additional safety training is still beneficial for employees.
Rippling PEO provides a convenient pay-as-you-go workers' compensation plan that doesn't require upfront payment for the entire year. This allows you to scale your business in Arizona and across the US without added stress.
Discrimination and harassment laws in Arizona
Arizona’s Civil Rights Act (ACRA), which is based on the federal Civil Rights Act, protects against discrimination and harassment in employment, housing, voting, and public accommodations. ACRA is enforced by the Arizona Attorney General’s Civil Rights Division.
In Arizona, it’s illegal to discriminate against or harass anyone based on:
- National origin
- Age (40 years or older)
- Physical/mental disability
It’s also illegal to retaliate against anyone who files a complaint or partakes in an investigation.
If an employee is subject to severe harassment based on one of the above categories, it may qualify as a hostile work environment. However, it’s important to distinguish individual annoyances, like a one-off joke, from harassment.
Sexual harassment training requirements vary by state. Employers in Arizona are not required to provide training, but it’s still a good idea for companies of all sizes. Rippling’s Learning Management System is pre-loaded with core sexual harassment training courses to make sure each worker meets the state requirements no matter where they live.
In Arizona—and federally—employers aren’t only liable for the discrimination and harassment they commit; they are also responsible for the conduct of their employees, regardless of their awareness of such incidents. Arizona places a significant emphasis on addressing workplace discrimination and harassment, and non-compliance can lead to the imposition of substantial penalties and fines.
Unions in Arizona
Labor unions can be described as groups of employees who work together (“act collectively”) to advance working conditions, such as increased pay, paid time off, vacation time, cost of living increases, and other robust benefits. The National Labor Relations Act (NLRA) guarantees employees the right to:
- Organize or become a member of a union to negotiate with their employer
- Bargain collectively by picking employee representatives for a written contract laying out working conditions
- Discuss their employment terms and conditions with fellow workers
- Take action to enhance working conditions by registering complaints with their employer or the government, or seeking assistance from a labor union
- Strike and picket, depending on the reason
- Abstain from joining a union
Under the NLRA, it is unlawful for unions to use intimidation tactics against employees, such as job loss threats or any punitive measures, if they choose not to support the union. Likewise, employers are prohibited from preventing, discouraging, bribing, terminating, demoting, or intimidating employees who express a desire to support a union.
Arizona has some union-related legislation that employers need to be aware of. Arizona is a “right-to-work” state, meaning:
- Employers cannot force an employee to join a union.
- If a business becomes a union shop, there is no obligation to join.
- Employees may leave a union without losing their job.
FAQs about Arizona labor and employment laws
Are independent contractors covered under Arizona employment laws?
In Arizona, independent contractors aren’t entitled to the same benefits as employees. This includes healthcare coverage, unemployment insurance, and workers' compensation. Our analyzer tool can help you verify proper worker classification and adhere to Arizona employment regulations.
Does at-will employment exist in Arizona?
Arizona is an at-will employment state, meaning that either the employer or employee can terminate the employment relationship without notice and for any reason.
Does pay transparency exist in Arizona?
No. Employers in Arizona are not required to disclose salary information to job applicants or current employees.
What privacy rights do employees have in Arizona?
Employers in Arizona can monitor and search company property (including email). However, privacy laws apply to an employee’s personal property. Regarding recordkeeping, employers are required to keep the medical records and personal files of employees confidential.
Are background checks legal in Arizona?
Background checks are legal in Arizona, but they must notify the applicant in advance. Arizona is a “ban the box” state, meaning criminal checks can’t be done until later in the recruitment process if you’re a public employer; this doesn’t apply to private companies.
Are whistleblowers protected in Arizona?
Yes. The Arizona Employment Protection Act (AEPA) protects private employees from retaliation for whistleblowing activities.
Is workers’ compensation coverage required in Arizona?
Under state law, employers must provide workers' compensation insurance for their employees. This requirement applies to large and small businesses that regularly hire or employ at least one employee, regardless of how many hours they work. Employers who fail to comply risk fines (starting at $1,000), lawsuits, and having their business shut down.
Are there required healthcare benefits in Arizona?
Yes. Under federal law, employers in Arizona with 50+ full-time employees must provide health insurance benefits. Smaller businesses can choose whether or not to offer healthcare benefits.
Are Arizona employers required to provide bereavement leave?
No. Private-sector employers do not have to provide bereavement leave of any kind. However, they may choose to do so as an additional benefit for their employees.
What employee protections are available in Arizona if layoffs occur?
The federal Worker Adjustment and Retraining Notification Act (WARN) requires businesses with 100+ employees to provide 60 days’ notice of covered plant closings or mass layoffs.
Do employers have to pay employees selected for jury duty in Arizona?
Arizona law does not require employers to pay their employees while they are on jury duty. State law also prohibits an employer from firing or discriminating against an employee for taking time off to serve as a juror, as long as they give reasonable notice.
Are there restrictions on child labor in Arizona?
The federal Fair Labor Standards Act (FLSA) and Arizona state laws regulate child labor. Child labor laws in Arizona are complex, covering the number of hours worked and when those hours can be worked. For example, no one under 16 can work more than three hours on a school day or eight hours on a non-school day, for a total of 18 hours a week. Employers hiring young workers should get legal advice before doing so.
Disclaimer: Rippling and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors before engaging in any related activities or transactions.