Arizona Overtime Calculator: Overtime Pay & Take-Home Pay

1. Does Arizona Have Overtime? Yes — But Only Federal

The question most frequently asked by Arizona workers is straightforward: does Arizona require overtime pay? The answer is yes, but with an important legal distinction: Arizona has NO state overtime statute of its own. Arizona has not enacted a state-level counterpart to California's daily overtime rules or New York's spread-of-hours provisions.

Instead, overtime protections for Arizona employees are governed purely by the federal Fair Labor Standards Act (FLSA, 29 U.S.C. § 207). Under federal law, covered non-exempt employees must be paid overtime compensation at not less than one and one-half times (1.5×) their regular rate of pay for all hours worked over 40 in a designated workweek. Arizona law does not require daily overtime — an employee who works a 10-hour or 12-hour shift earns no overtime premium for that day unless their total hours across the 7-consecutive-day workweek exceed 40. Furthermore, there is no statutory double-time requirement in Arizona.

Two federal nuances frequently arise in Arizona workplaces:

• Public-Sector Compensatory Time: Under 29 U.S.C. § 207(o), public agency employees (state, county, and municipal government workers) may receive compensatory time off (comp time) at a rate of 1.5 hours of paid leave for every overtime hour worked instead of cash overtime pay, pursuant to an agreement before the work is performed (banked up to 240 hours, or 480 hours for public safety personnel). Comp time is strictly unlawful for private-sector employers.
• The "Regular Rate" Rule: An employee's regular rate is not simply base pay. It includes shift differentials, non-discretionary production bonuses, and hazardous duty premiums. For workers who work at two different hourly rates within the same workweek, the FLSA regular rate is calculated as the weighted average of the two wage rates.

2. An Indexed Minimum Wage from the Voters: Proposition 206

While Arizona relies on federal law for overtime hours, its minimum wage is determined by Arizona voters. Under Proposition 206 (the Fair Wages and Healthy Families Act, 2016), codified at A.R.S. § 23-363, Arizona's minimum wage is indexed annually to inflation based on positive increases in the Consumer Price Index for All Urban Consumers (CPI-U).

For calendar year 2026, Arizona's statewide minimum wage is $15.15 per hour (effective January 1, 2026, up from $14.70 in 2025). This establishes a statutory minimum overtime floor in Arizona of $22.73 per hour ($15.15 × 1.5).

Arizona law permits a flat $3.00 per hour tip credit (A.R.S. § 23-363(C)). Unlike jurisdictions that use a percentage credit, Arizona employers may pay tipped employees a direct cash wage of $12.15 per hour ($15.15 minus $3.00), provided the employee's direct cash wages plus customer tips average at least $15.15 per hour across the workweek. If tips fall short, the employer must pay the difference.

3. Two Cities Go Higher: Flagstaff and Tucson

Arizona state law preserves the right of municipalities to enact local wage floors higher than the state minimum. Two Arizona cities have exercised this authority:

• Flagstaff: Enforces a 2026 minimum wage of $18.35 per hour. Crucially, starting in 2026, Flagstaff permanently eliminated its tip credit — all covered workers, including restaurant servers and bartenders, must receive the full $18.35 per hour in direct cash wages. The overtime rate for a baseline worker in Flagstaff is $27.53 per hour.
• Tucson: Enforces a 2026 minimum wage of $15.45 per hour under the Tucson Minimum Wage Act (Proposition 206 local ordinance), with a tipped cash wage floor of $12.45 per hour ($15.45 minus the $3.00 tip credit).
• Phoenix, Mesa, Chandler, Scottsdale, and Other Cities: Follow the Arizona statewide rate of $15.15 per hour.

Our calculator applies the statewide $15.15 rate and warning. If you work within Flagstaff or Tucson city limits, enter your actual hourly rate into the calculator above to see your estimated take-home pay.

4. Salaried Employees: Federal FLSA Exemption Rules Apply

Because Arizona has no state overtime law, the exemption status of salaried workers depends entirely on federal FLSA regulations. To be exempt from overtime as an executive, administrative, or professional (EAP) employee in Arizona, a worker must satisfy both parts of the federal exemption test:

• Salary Basis & Salary Level Test: The employee must be paid a predetermined, fixed salary of at least $684 per week ($35,568 annually). Arizona has not enacted a higher state salary threshold (unlike California, New York, or Washington).
• Job Duties Test: The employee's primary job duties must meet the specific criteria outlined in 29 C.F.R. Part 541 (such as managing a recognized department, customarily directing two or more employees, exercising independent judgment on matters of significance, or performing work requiring advanced specialized knowledge).

Any salaried employee in Arizona who earns less than $684 per week, or whose actual day-to-day duties do not satisfy the federal duties test, is legally non-exempt and owed 1.5× overtime pay for all hours worked over 40 in a workweek. Paying an employee a "salary" does not strip them of overtime rights.

5. Paid Sick Time, Meal Intervals, and Final Pay

Proposition 206 also enacted Arizona's comprehensive earned paid sick time statute (A.R.S. § 23-373):

• Paid Sick Time Accrual: All Arizona employees accrue 1 hour of paid sick time for every 30 hours worked. Employers with 15 or more employees must permit workers to accrue and use up to 40 hours of paid sick time per year; employers with fewer than 15 employees must allow up to 24 hours per year. Sick time is paid at the employee's regular hourly rate.
• Meal and Rest Breaks: Neither Arizona law nor the federal FLSA requires employers to provide meal periods or rest breaks for adult employees. However, if an employer chooses to provide short rest breaks (typically lasting 5 to 20 minutes), federal law mandates that they must be counted as compensable paid work time. Bona fide meal periods of 30 minutes or longer, where the employee is completely relieved of all duties, may be unpaid.
• Final Pay Requirements: Under A.R.S. § 23-353, when an employee is discharged or terminated, their final paycheck must be paid within 7 working days or by the end of the next regular pay period, whichever is sooner. When an employee quits or resigns, final wages are due no later than the regular payday for the pay period in which the separation occurred.

6. Arizona Taxes Overtime — At the Lowest Flat Rate in America

Unlike states with graduated tax brackets, Arizona levies a single, flat state personal income tax rate of 2.5% under A.R.S. § 43-1011 — the lowest flat rate of any state with an income tax in the United States.

However, Arizona taxes all earned wage income, including overtime pay. Overtime premiums do not receive a special state tax exemption. Furthermore, the federal Section 225 "No Tax on Overtime" deduction (OBBBA) for tax years 2025 through 2028 does NOT reduce your Arizona state income tax. Arizona taxable income begins with federal adjusted gross income (FAGI). Because the federal overtime deduction is claimed below AGI on Form 1040 (which you can estimate using our no tax on overtime calculator), and because the Arizona Legislature has enacted no state-level subtraction for overtime premiums, the entire overtime compensation is taxed at Arizona's 2.5% rate.

7. How the Arizona State Tax Line Is Computed

To provide 100% transparency, here is how our calculator computes your exact Arizona state tax:

1. Annualize Gross Earnings: Your weekly gross pay (regular pay + 1.5× overtime pay) is annualized by multiplying by 52.
2. Subtract the Arizona Standard Deduction: Arizona statutory law (A.R.S. § 43-1041) pegs the state standard deduction directly to the federal amounts: $16,100 for Single filers, $32,200 for Married Filing Jointly, and $24,150 for Head of Household.
3. Apply the Flat 2.5% Rate: If annualized gross exceeds the standard deduction, the taxable amount is multiplied by 2.5% (0.025) to determine annual state tax liability. If gross is below the deduction, state tax is $0.00.
4. De-Annualize to the Pay Period: The annual liability is divided by 52 to calculate the weekly deduction.

Tax Note on Form A-4: In Arizona, employee wage withholding is governed by Form A-4 (Employee's Arizona Withholding Percentage Election). Under Arizona administrative rules, workers elect a flat withholding percentage (such as 0.8%, 1.3%, 1.8%, 2.7%, 3.6%, or 4.2%) from their gross pay. Consequently, the state withholding on your actual pay stub may differ slightly from the statutory annual tax liability computed here; any overpayment or underpayment is settled when filing Form 140.

8. Unpaid Overtime: Enforcing Your Federal and State Wage Rights

Because Arizona does not have a state overtime statute, claims for unpaid overtime pay cannot be filed under Arizona state law — they must be brought under federal law:

• File a Federal Wage Complaint: You can file a formal complaint with the U.S. Department of Labor Wage and Hour Division (WHD) online or by calling 1-866-487-9243. The WHD has field offices in Phoenix and Tucson that investigate wage violations and recover back pay.
• File a Private FLSA Lawsuit: Under 29 U.S.C. § 216(b), you can file a lawsuit in federal court. If your employer violated the law, you are entitled to 100% back pay plus an equal amount in liquidated damages (double damages), as well as reasonable attorney fees and court costs. The statute of limitations is 2 years for standard violations and 3 years for willful violations.
• State Claims with the Industrial Commission of Arizona (ICA): The Labor Department of the Industrial Commission of Arizona handles state-law claims — including minimum wage violations under Proposition 206, unpaid regular wages (A.R.S. § 23-350 et seq.), and earned paid sick time violations. Wage claims for unpaid regular wages under $5,000 can be submitted directly to the ICA within 1 year of the violation.
• Retaliation Is Strictly Prohibited: Both the federal FLSA (29 U.S.C. § 215(a)(3)) and Arizona Proposition 206 (A.R.S. § 23-364(B)) strictly forbid employers from firing, demoting, cutting hours, or threatening employees who ask about overtime, consult with an agency, or file a wage complaint.