Labor Department

Lisa Padgett, Director
Email: [email protected]
Phoenix: 800 W Washington St, Phoenix AZ 85007 - Phone: (602) 542-4515
Tucson: 2675 East Broadway, Tucson AZ 85716 - Phone: (520) 628-5459

Substantive Policy Statement Regarding Application of Arizona Minimum Wage Act to Work Activities Performed by Individuals with Disabilities

The attached document is the Industrial Commission of Arizona’s substantive policy statement regarding the applicability of the Arizona Minimum Wage Act (“Act”) to individuals that have developmental, cognitive, mental, or physical challenges. It is the intention of the Commission to rely on this substantive policy statement until such time that it is assured that the policy is doing what it is supposed to do. If issues arise that were not contemplated or are not addressed in this policy statement, the Commission asks that the issues be brought to our attention as soon as possible. We are committed to keeping the affected community informed and will continue do so as we progress towards establishing permanent rules, which process we will begin at some point down the road. Under that process, the affected community will also have the opportunity to formally comment on the proposed permanent rules. 

This substantive policy statement is strictly limited to the Commission’s interpretation of who, under the circumstances presented, is an “employee” under the Act. The Commission’s interpretation has no application to, nor is it intended to affect or change, the policies, rules, and statutes enforced by other state or federal agencies that apply to “employees” under those respective policies, rules, and statutes, including the FLSA. Additionally, addressing comments received during the recent public hearing regarding the need to establish “certificated processes” or to define and regulate the payment of a “stipend,” the Commission’s authority is limited by the Act. In this regard, the Commission does not have the authority to establish processes or procedures to authorize the payment of sub-minimum wages to employees. If an individual meets the definition of an employee, then the Act requires that the individual be paid at least $7.65 per hour (subject to limited exceptions not applicable here). Likewise, the Commission does not have jurisdiction to regulate the payment of a stipend to an individual that is not an employee. 

On behalf the Commission, we wish to thank all of those that have participated and provided their assistance in this process. Your help and assistance in developing a workable substantive policy statement has been invaluable.