On January 1, 2025, the Arizona minimum wage will increase by 35 cents, bringing it to $14.70 per hour. The minimum wage will remain at $14.35 per hour through December 31, 2024. As a result of the increased minimum wage rate, by January 1, 2025, employers will need to do two things:
On November 5, 2024, Arizona voters rejected a ballot measure that would have modified the minimum wage structure for tipped workers. Proposition 138 would have amended the Arizona Constitution to allow employers to pay tipped workers 25% less than the minimum wage rate but only if the employer could establish that the employee made at least $2 more per hour over the minimum wage for all hours worked. As a result of Arizona voters rejecting this ballot measure, the current law will remain in effect, which allows employers to pay their tipped workers up to $3 per hour less than the minimum wage.
Some municipalities in Arizona have minimum wage ordinances, such as Flagstaff and Tucson, that set minimum wage rates that are higher than the state minimum wage. Employers with employees working in those cities should ensure they are complying with any applicable local ordinance.
Consulting and Enterprise members of Employers Council can contact us at info@employerscouncil.org if they have any questions about the minimum wage increase or how it affects their operations.
Jaimie Graczyk is an attorney for Employers Council.