Arizona Minimum Wage 2027

Flagstaff, Tucson and Phoenix

Flagstaff adopted its own minimum wage in 2016 and has already published the 2027 figure: $18.95 an hour. Unlike the state and Tucson, Flagstaff does not let employers count tips toward it, so servers and bartenders there receive the full rate in wages.

Tucson's rate comes from its own ballot measure, which by coincidence also carried the number 206: city voters approved the Tucson Minimum Wage Act in November 2021. It started at $13.00 on April 1, 2022 and reached $15.00 on January 1, 2025; in 2023 and 2024 the state rate was higher than Tucson's scheduled step, so the state rate applied. Since 2025 Tucson follows the consumer price index and never falls below the state or federal rate. It covers anyone who works at least five hours in a pay cycle inside city limits. The city page still showed only $15.45, valid through December 31, 2026, on October 22, 2026. Arizona Public Media reported on September 14, 2026 that Tucson will move to $16.00 in 2027; this page switches to the city's own figure once it is posted.

Phoenix, Mesa, Tempe, Scottsdale and Yuma: we found no minimum wage ordinance of their own, so the state rate of $15.65 applies there as far as we can tell. The state does not publish a list of local minimum wages.

Why Arizona cities are allowed to pay more

Arizona's statute book contains two sections that seem to contradict each other. Section 23-362(B), still printed on the Legislature's website, says no political subdivision may require a minimum wage above the federal one. A later section written by voters, 23-364(I), says the opposite: a county, city or town “may by ordinance regulate minimum wages and benefits within its geographic boundaries” as long as it does not go below the state rate.

The state's Attorney General settled which one applies in Opinion I23-004 of June 15, 2023: a city may regulate minimum wages under 23-364(I), so long as they are not less than the statewide minimum. The Industrial Commission's own guidance points the same way and names Flagstaff as its example.

How the $15.65 was set

Arizona's wage comes from two ballot measures: Proposition 202 in 2006 and Proposition 206, the Fair Wages and Healthy Families Act, on the November 8, 2016 ballot. Proposition 206 wrote four fixed steps into section 23-363(A), from $10 in 2017 to $12 in 2020. Since 2021 the rate rises every January 1 by the change in the consumer price index for all urban consumers (CPI-U, U.S. city average) from one August to the next, rounded to the nearest five cents (section 23-363(B)). The Industrial Commission of Arizona applies the formula and publishes the new rate in the fall; the 2027 poster went online on September 25, 2026.

For 2027 the increase is $0.50, or 3.3%. Because the law was approved by voters, the Legislature cannot repeal it, and it can amend it only with three quarters of each chamber and only to further the law's purpose (Arizona Constitution, Article IV, Part 1, Section 1(6)). The state's statute pages flag this with the note “1998 Prop. 105 applies.”

Servers and other tipped jobs: $12.65 in cash

Outside Flagstaff an Arizona employer may pay a tipped employee up to $3.00 an hour less than the minimum wage, which means $12.65 in cash wages from January 1, 2027 (now $12.15). Wages plus tips must still reach $15.65 for every hour in each week, and the employer has to prove that with charged-tip records or the employee's own tip declaration.

The Industrial Commission counts as tipped employees people who customarily and regularly receive tips, such as waiters, bellhops, bussers, car wash attendants, hairdressers, barbers, valets and service bartenders. The lower cash wage applies only to hours spent in that tipped job; when a tipped employee is routinely assigned to maintenance or general prep work, those hours are paid at the full rate. A mandatory service charge counts as a tip only if the employer passes it to the employee in the same pay period.

Teenagers, salaried staff and small businesses

• No youth or training wage. The Industrial Commission states that Arizona's law makes no distinction between adults and minors, and that it has no authority to approve wages below the minimum. A 16-year-old cashier is owed $15.65 like everyone else.
• Salaried and commission pay. The minimum applies to every hour, however the job is paid. Arizona has no salary threshold of its own; for overtime, the federal rule applies, and its threshold is $684.00 a week ($35,568 a year).
• Small businesses. A business with less than $500,000 in yearly revenue is exempt only if the federal minimum wage does not apply to any of its workers, which the Commission calls a very limited exclusion. Those businesses still owe paid sick time.
• Uniforms and tools. An employer may not deduct their cost, or the cost of cleaning them, from the minimum wage unless a union contract allows it.
• Not covered at all: people employed by a parent or sibling, casual babysitters in the employer's home, and employees of the State of Arizona or the federal government.

Paid sick time came with the same law

Proposition 206 also created earned paid sick time (section 23-372). Every employee earns at least one hour for each 30 hours worked. At employers with 15 or more workers, up to 40 hours a year can be earned and used; at smaller employers the cap is 24 hours, unless the employer allows more. A full-time worker reaches the 40 hours after about 30 weeks, someone working 20 hours a week at a small employer reaches 24 hours after about 36 weeks. Unused hours carry over to the next year, within the same yearly limits.

What $15.65 an hour adds up to

At 40 hours a week, the 2027 rate comes to $626.00 a week and $32,552 a year before taxes. Arizona taxes wages at a flat 2.5%, on top of federal income tax, Social Security and Medicare; the last column shows what a single filer keeps. The Arizona paycheck calculator shows the same for each pay period and other filing statuses.

Filing a claim in Arizona

Minimum wage and sick time complaints go to the Industrial Commission of Arizona, Labor Department, online or by mail, fax or email, within one year of the date the wages were due. Older claims are dismissed. A lawsuit can be filed up to two years after the last violation, or three years if it was willful (section 23-364(H)).

Employers must keep payroll records of hours and pay for four years; if they are missing, the law presumes the minimum wage was not paid. Any firing, cut in hours or other penalty within 90 days after an employee asserts these rights is presumed to be retaliation. Overtime claims are not handled by the Commission and go to the U.S. Department of Labor. The Commission also does not enforce city ordinances: Tucson runs its own Labor Standards Unit, which takes complaints about the city rate.

How this is calculated

The calculator opens on Arizona and uses the statewide rate on the date you choose, so today gives $15.15 and January 1, 2027 gives $15.65. Flagstaff and Tucson are not built in; their rates are in the table above. Pay is the hourly rate times your weekly hours, over 52 weeks, and a month is one twelfth of the year.

Take-home pay uses the 2026 federal brackets for a single filer without dependents, Social Security at 6.2%, Medicare at 1.45% and Arizona's flat 2.5% after the state standard deduction. Tips and overtime are left out.