In November 2006 the voters approved an increase in Arizona's minimum wage. At that time the minimum wage went from $5.15 per hour to $6.75 per hour. That initiative also called for a cost of living increase in subsequent years on each January 1st.
Other states besides Arizona have adopted annual inflation indexing for their minimum wages. They include Colorado, Florida, Missouri, Montana, Nevada, New Jersey, Ohio, Oregon, Vermont, Washington.
In November 2016 voters approved a new measure relative to minimum wage that would raise the minimum to $12 per hour by the year 2020. The progressions from the current minimum wage rate in Arizona to 2020 is:
$10.00 per hour effective January 2017
$10.50 per hour effective January 2018
$11.00 per hour effective January 2019
$12.00 per hour effective January 2020
Beginning in January 2021 Arizona's minimum wage will be adjusted each year based on cost of living.
Why didn't the minimum wage in Arizona increase in 2016?
Arizona's law defines the calculation on which it is based, the Consumer Price Index. It did not increase enough to move the minimum wage by another five cents or more.
Do People Who Get Tips Earn Minimum Wage in Arizona?
Yes and no.
The State of Arizona has a higher minimum hourly wage ($5.05) than federally required ($2.13 as of August 1, 2016) for tipped employees.
Employers may pay an employee that receive tips an hourly rate that is $3 less per hour than Arizona's minimum wage as long as the tips that are earned and distributed to the employee would bring that rate at least up to the minimum wage (2017).
For example, if a server in a restaurant has an hourly wage of $6 per hour, the tips earned by the employee must bring the earnings up to at least the minimum wage, as stated above. If the tips aren't enough to bring the cumulative earnings up to the minimum wage, the employer must make up the difference to the employee.