Texas Minimum Wage 2027

Why Texas pays $7.25

The Texas Minimum Wage Act, chapter 62 of the Labor Code, has never named a dollar figure of its own. Section 62.051 says an employer “shall pay to each employee the federal minimum wage” under the Fair Labor Standards Act. The federal rate rose in three steps after a 2007 law, to $5.85, then $6.55, and reached $7.25 on July 24, 2009. It has not moved since, so neither has the Texas rate.

Nothing in either law raises the amount with prices. A different Texas rate would take a change to section 62.051. The Legislature meets in regular session only in odd-numbered years, on the second Tuesday in January, so the next chance is the session that opens January 12, 2027. As of October 22, 2026 the law still points to the federal rate.

Houston, Dallas, San Antonio, Austin, El Paso: also $7.25

Texas cities and counties cannot set a higher minimum for private employers. Section 62.0515 makes the state rate override any city ordinance, order or charter provision “governing wages in private employment.” A job at a store in Houston, a restaurant in El Paso or a warehouse near Dallas therefore has the same floor as a job anywhere else in the state: $7.25 an hour.

Two things fall outside that rule. A city can still pay its own workers more, and it can put a wage requirement into a contract or agreement a company signs with it; that company is then bound by the contract (section 62.0515(c)). Neither changes what other employers in the city must pay.

Servers and other tipped jobs: $2.13 plus tips

For a tipped employee, section 62.052 uses the federal tip rule: the employer pays at least $2.13 an hour in cash and may count up to $5.12 an hour of tips toward the rest. For the jobs the Texas act covers, a “tipped employee” is anyone who regularly gets more than $20 a month in tips; the federal act, which covers most jobs, draws the line at $30.

In a 40-hour week that means $85.20 in cash wages, and cash plus tips must come to at least $290.00. If a slow week leaves a server short, the employer owes the difference. Tips belong to the worker; the employer can only count them toward the minimum.

Teenagers, students and other exceptions

Most Texas jobs are covered by the federal Fair Labor Standards Act, and for those workers the federal law is what guarantees $7.25. The Texas act steps aside for them (section 62.151) and covers the smaller group the federal act misses. Its own list of exceptions (sections 62.152 to 62.161) includes:

• workers under 18 who have not finished high school or a vocational program, and students under 20 enrolled in school or college;
• babysitters and others doing domestic work in a private home, and live-in caregivers;
• an employer's spouse, children, parents, siblings and in-laws;
• amusement or recreation businesses open no more than seven months a year;
• employers that do not owe Texas unemployment tax, except for farm work;
• dairy farm workers, people in jail or prison, and executive, administrative and professional employees.

Federal law has one rule teenagers ask about: an employer may pay a new worker under 20 as little as $4.25 an hour during the first 90 calendar days on the job (29 U.S.C. § 206(g)). After 90 days, or at age 20, the full $7.25 applies.

What $7.25 an hour comes to

Texas has no state income tax on wages, so the only deductions in the table are federal income tax, Social Security and Medicare. A full-time year at the minimum is $15,080 before tax. For your own pay schedule, use the Texas paycheck calculator.

Overtime comes from federal law too: after 40 hours in a workweek, at least one and a half times the regular rate, which is $10.88 an hour at the minimum (29 U.S.C. § 207). Salaried employees can be exempt from overtime only if they earn at least $684.00 a week ($35,568 a year) and their duties qualify; Texas adds no higher threshold.

Next door to Texas

Commuters and people thinking of moving often compare. Two neighbors pay more by their own state law, two use the same $7.25:

All 50 states are on the minimum wage by state page.

If you were paid less

Unpaid wages in Texas go to the Texas Workforce Commission under the Texas Payday Law. The claim has to reach the agency within 180 days of the payday the money was due; the deadline is strict, and only the part of a claim inside those 180 days counts. You can file online or on a paper form from the wage claim page.

A lawsuit is the other route. Under the Texas Minimum Wage Act it must be filed within two years, and a court can award the unpaid wages plus the same amount again, with attorney's fees (sections 62.201 to 62.205). The Payday Law also sets the paydays: most hourly workers must be paid at least twice a month, and someone who is fired must get the final paycheck within six days.

How this is calculated

The calculator starts on Texas and January 1, 2027. Pick “Today” to see the rate in effect now; for Texas the answer is the same. Weekly pay is $7.25 times your hours, the year is 52 such weeks, and a month is the year divided by 12.

Take-home pay subtracts 2026 federal income tax for a single filer with no children, plus 6.2% Social Security and 1.45% Medicare. There is no Texas income tax to subtract. A worker with children who qualifies for the Earned Income Tax Credit would get money back at tax time; that refund is not in the figure.