Arizona Minimum Wage Increase and New Sick Leave Law (Notice Postings)

Proposition 206 passed in Arizona and that means A.R.S. § 23-363 and § 23-364 are in effect as of January 1, 2017.  These statutes increase the minimum wage and create a requirement that all employers provide a sick leave benefit for their employees.

Minimum Wage

The Arizona Minimum Wage is increased to $10 per hour as of January 1, 2017.  There will be annual increases as follows:

January 1, 2018: $10.50

January 1, 2019: $11.00

January 1, 2020: $12.00

After 2020 there will be annual cost of living increases.

Sick Leave Benefits

Starting July 1, 2017, all Arizona employers must provide a sick leave benefit for their employees.  As of July 1, 2017, employees earn at least 1 hour of sick time for each 30 hours worked.  Employees in companies with fewer than 15 employees are not entitled to accrue or use more than 24 hours of sick time each year and employees in companies with 15 or more employees are not  entitled to accrue or use more than 40 hours of sick time each year.

Sick leave can be rolled over into future years but there is no requirement to pay an employee for sick leave when they leave their employment.  There are strict penalties for failure to comply or for discriminating against an employee for attempting to exercise their rights.  Employers in every industry should evaluate their benefits packages and employee manuals to make sure they are in compliance.

One other highlight: Employers cannot require employees to make arrangements with other employees to cover their shift for sick leave.

For further information about these new laws or other business law issues, please contact our attorneys (Pat Durazzo, Neal Eckel or Eric Hawkins) at 520-792-0448 or  Our attorneys work in the fields of business law, employment law, construction law and corporate law, and are available to assist your business.  The State of Arizona provides some guidance and notice posters (which employers are required to post) at the Industrial Commission website located here.

Written by

Eric Hawkins received his B.A. from the University of Arizona, and his J.D. from the University of Arizona College of Law. Eric has been with the firm since his admission to the bar in 2006, and became a partner in 2011. Eric practices primarily in the areas of Construction law, Employment law, and Business law. This work includes contract preparation and review, partnership agreements, construction collection claims, Registrar of Contractors matters and disputes both in and out of the courtroom. Over the past five years Eric has successfully litigated several cases involving business fraud, construction defects, and employment disputes. Eric has worked with the Alliance of Construction Trades in Tucson, and represents subcontractors and suppliers in the organization. Eric has written numerous articles on various issues including indemnification, construction contracts, insurance law and employment practices.