Arkansas Minimum Wage: Rates and Rules for Employers
Arkansas pays $11.00 an hour, with a $2.63 tipped cash wage and a four employee threshold. Here is the tip credit, the student rate, and the exemptions.
Arkansas Minimum Wage
One statewide rate, a four employee coverage threshold, and a tipped cash wage floor that stays put while the credit moves
The first Arkansas wage question I ever got was not about the rate. It came from an owner in Fayetteville with three employees who had read that Arkansas pays $11.00 an hour and wanted to know how the shop two doors down was legally paying less. The answer was the four employee threshold, and it is the most misread line in the state wage law.
Arkansas is otherwise one of the simplest states on this subject. There is one rate, it applies everywhere, and it has not changed since the last step of a voter-approved schedule landed on January 1, 2021. No city sets its own floor. No index moves the number every January.
That stability creates a different trap. A rate that never moves stops getting checked, and the pieces around it, the tip credit arithmetic and the student certificate, are where mistakes actually happen. Below you will find the rate, who it covers, the exemptions, and the paperwork, as the Arkansas Department of Labor and Licensing sets them out.
The Current Rate
The Arkansas minimum wage is $11.00 per hour, effective January 1, 2021. The Department of Labor and Licensing states it in one line on its minimum wage and overtime page, and the rate itself sits in Arkansas Code § 11-4-210.
Coverage is the part that matters for a small employer. The Arkansas Minimum Wage Act applies to an employer of four or more persons, and the definition excludes an employer for any workweek in which fewer than four employees are employed. The count is done week by week, not once at incorporation.
Counting is where people go wrong. The state rules say employees who are themselves exempt from the act still count toward the four, so two exempt managers plus two hourly staff makes a covered employer.
Coverage also brings recordkeeping. Payroll records under the act have to be kept for three years, including the name, address, occupation, rate of pay, hours worked, and amount paid each pay period.
The enforcement side is short. An employee may sue for the full amount of wages due plus costs and a reasonable attorney fee, and does not have to exhaust administrative remedies (go through an agency complaint process) first. For a willful violation, a court may award liquidated damages up to the same amount again.
The act also protects the process itself. Hindering an inspection or retaliating against a complaint carries a civil penalty of $50 to $1,000 per violation.
How the rate got here
Each step below is written into Arkansas Code § 11-4-210 itself. The last three came from Issue 5, a citizen initiative (an act proposed by petition of the people) that appeared on the November 6, 2018 ballot and amended the section directly.
| Effective date | Minimum wage | Where it comes from |
|---|---|---|
| Jan. 1, 2015 | $7.50 | Ark. Code § 11-4-210(a)(2) as it read before the 2018 measure |
| Jan. 1, 2016 | $8.00 | Same subsection |
| Jan. 1, 2017 | $8.50 | Same subsection |
| Jan. 1, 2019 | $9.25 | 2018 Initiated Act, Issue 5 |
| Jan. 1, 2020 | $10.00 | 2018 Initiated Act, Issue 5 |
| Jan. 1, 2021 | $11.00 | 2018 Initiated Act, Issue 5 (current rate) |
Before that run, the statutory rate was $6.25 per hour beginning October 1, 2006. The pattern is worth noticing: Arkansas moves its wage floor in blocks approved at the ballot box, then leaves it alone for years.
The Next Scheduled Increase
No increase is scheduled. The schedule voters approved in 2018 finished on January 1, 2021, and Arkansas does not tie its minimum wage to the Consumer Price Index or to any other automatic adjustment.
That means $11.00 per hour stands until the General Assembly passes a law changing it or voters approve another initiated act. Neither of those has a date on it, and any source quoting a future Arkansas rate is guessing rather than reading a statute.
I can't tell you what may appear on a future ballot, and I won't pretend otherwise. What I can tell you is where the answer will show up first: the department's minimum wage and overtime page, which carries the current rate and the effective date in its opening line.
Tipped Employees and the Tip Credit
Arkansas tipped employees must receive a cash wage of at least $2.63 per hour. The employer may cover the rest of the minimum with a gratuity allowance (the state's version of the tip credit) of no more than $8.37 per hour. Both figures are printed on the notice the department requires employers to post.
The allowance is conditional, not automatic. Under the state minimum wage rules, an employer may claim it only where the employee actually received that much in gratuities, and only where applying it still leaves at least $2.63 per hour in wages other than gratuities. When tips fall short in a workweek, the shortfall comes out of the employer's pocket in cash.
Who counts as tipped is defined by the occupation, not by preference. The rules point to waiters, waitresses, bellhops, beauty operators, and barbers as occupations where gratuities are customarily and usually recognized as part of the pay. Any other occupation qualifies only where the employee actually receives more than $20 per month in tips.
| Rule | What the state rules require | Where it bites |
|---|---|---|
| Cash wage floor | At least $2.63 per hour in wages other than gratuities | The floor does not move with the rate; the allowance absorbs the change |
| Maximum allowance | No more than $8.37 per hour, and only to the extent tips were actually received | A slow week means a cash top-up, not an averaged month |
| Dual jobs | Twenty minutes or more in a non-tipped occupation makes the entire hour payable at the full rate with no allowance | Prep, cleaning, and counter shifts scheduled in blocks |
| Tips turned over to the employer | Where tips are credited to the employer as gross receipts, the employee is not a tipped employee | House policies that sweep tips into revenue |
| Written notice of a change | The allowance taken per hour must be reported to the employee in writing each time it changes from the previous week | Variable credits set by hand each period |
| Tip records | A notation identifying each tipped employee, plus reported tip amounts, which may be employee reports on IRS Form 4070 | Reconstructing a year of tips after a claim is filed |
The dual jobs rule is the Arkansas-specific one worth reading twice. Twenty minutes of non-tipped work makes the whole hour payable at the full minimum wage without any allowance, which is a tighter line than most owners assume.
City and County Rates
There are no city or county minimum wages in Arkansas. The state publishes one rate, and no Arkansas municipality or county publishes a wage floor of its own.
An employer in Little Rock, Fayetteville, Fort Smith, Springdale, or Jonesboro pays the same $11.00 per hour as an employer in a town of 500. Two locations at opposite ends of the state run on one number, and the local ordinance research that consumes an afternoon in California or Washington is not part of payroll here.
One honest note on sourcing: this describes what exists today, not what a city may never do. Nothing published by the Department of Labor and Licensing points to a local rate anywhere in Arkansas, and the University of California, Berkeley Labor Center inventory of city and county minimum wage ordinances lists none in the state.
Exemptions and Industry Carve-Outs
Arkansas has no industry-specific minimum wage. There is no fast food rate, no healthcare rate, and no separate agricultural rate. What the state has instead is the four employee threshold plus a list of excluded workers written into Arkansas Code § 11-4-203(2).
| Who sits outside the state minimum wage | Where it is written | What it means in practice |
|---|---|---|
| Employers with fewer than four employees in a workweek | Ark. Code § 11-4-203(3)(B) | The state act does not reach them; federal law is then the question |
| Executive, administrative and professional employees, and outside commission-paid salespeople | Ark. Code § 11-4-203(2)(A) | The federal duties tests at 29 C.F.R. pt. 541 are adopted by state rule |
| Students working for the school, college or university they attend | Ark. Code § 11-4-203(2)(B) | Applies to the school as employer, not to any job a student holds |
| Agricultural employers under 500 man-days of farm labor in a quarter of the prior year | Ark. Code § 11-4-203(2)(F) | Small farms only; a larger farm owes the state rate |
| Immediate family of an agricultural employer | Ark. Code § 11-4-203(2)(G) | Parent, spouse, child, or other immediate family member |
| Hand-harvest piece-rate laborers who commute daily and worked under 13 weeks in agriculture last year | Ark. Code § 11-4-203(2)(H) | A narrow seasonal harvest exclusion, not a general farm exemption |
| Employees principally engaged in the range production of livestock | Ark. Code § 11-4-203(2)(J) | Range work, not general ranch or feedlot labor |
| Forestry or lumbering operations with eight or fewer employees | Ark. Code § 11-4-203(2)(K) | The headcount is the whole test |
| Nonprofit recreational or educational camps operating seven months or less | Ark. Code § 11-4-203(2)(L) | A camp running eight months falls outside this exclusion |
| Casual domestic babysitting and companionship services | Ark. Code § 11-4-203(2)(O) | Federal rules at 29 C.F.R. pt. 552 define the terms |
| Newspaper delivery to retail subscribers, and small papers under 4,000 circulation | Ark. Code § 11-4-203(2)(N) and (P) | Most of the circulation must be in the county of publication or a contiguous county |
| Direct sellers as defined at 26 U.S.C. § 3508(b)(2) | Ark. Code § 11-4-203(2)(S) | The federal tax definition governs |
| Bona fide independent contractors | Ark. Code § 11-4-203(2)(E) | Status is judged under the Empower Independent Contractors Act; misclassification is not an exemption |
| Employees of the United States government | Ark. Code § 11-4-203(2)(C) | Federal employment, not state-covered employment |
| Workers with a disability under a certificate | Ark. Code § 11-4-214 | Requires certification from the state division or the United States Department of Labor |
Two clarifications on agriculture, because it draws the most confusion. Farm employees are exempt from the state overtime requirement outright, but they are not automatically outside the minimum wage: the exclusion turns on the 500 man-day test and the narrow harvest and range provisions above. A mid-size Arkansas farm above that man-day line owes $11.00 an hour.
The full exemption text and the duties tests sit in the Department of Labor and Licensing minimum wage rules, which run to 44 pages and repay a read before you classify anyone.
Youth, Student and Training Wages
Arkansas has no general youth wage. There is no rate tied to being under 18 or under 20, so for a covered employer a teenage new hire is owed the same $11.00 per hour as anyone else unless a specific certificate is in hand.
The main subminimum is the full-time student rate: 85 percent of the applicable minimum wage, which is $9.35 per hour at the current rate. The department will not let you apply it after the fact, so treat the conditions below as preconditions, not paperwork to tidy up later.
Learners, student learners, and apprentices sit in a parallel lane. An Arkansas employer may pay them at least 85 percent of the state minimum wage, but only with current and valid certification from the United States Department of Labor under the federal learner and student-learner rules.
One detail catches restaurants. A student paid on the 85 percent provision who also receives a gratuity allowance cannot be paid less than the base cash wage guaranteed to any other tipped employee, so $2.63 per hour is the floor for that person too.
Dated obligations like a certificate expiry are exactly the kind of thing an employee record should surface, which is what FirstHR is built to do.
The Poster Requirement
Arkansas requires the poster. The state notice says plainly that employers subject to the Minimum Wage Act are required to post it in a conspicuous place for all employees, and the state rules require a covered employer to post a notice approved by the division in every establishment where covered employees work.
The document is the Notice to Employer and Employee, a single sheet covering minimum wage, overtime, child labor, and wage collection. It is a free download from the department's required postings page, which flags it as required for employers with four or more employees and warns that failing to post can bring penalties and fines.
Check the version on your wall rather than assuming. The current sheet is the August 2023 revision, and it prints both the $11.00 rate and the $8.37 gratuity allowance, so an older copy showing $10.00 is a live misstatement to your own staff. Federal postings are a separate stack, and the Fair Labor Standards Act poster is required at covered workplaces by federal law.
How the State Rate Meets the Federal Floor
Arkansas at $11.00 sits $3.75 above the federal minimum wage of $7.25, which has not moved since 2009. The department states the rule for overlapping coverage directly: where both laws apply, the employer follows whichever sets the higher requirement, and in Arkansas that is the state rate.
The same logic runs through tipped pay. The Arkansas cash wage floor of $2.63 is higher than the federal tipped cash minimum of $2.13, so the state figure governs for a covered employer.
The four employee threshold is the one place this flips. An Arkansas employer below four employees in a workweek is outside the state act entirely, and the floor becomes whatever federal law imposes: $7.25 per hour where the Fair Labor Standards Act covers the business or the individual employee. That is the legitimate version of the shop paying less down the street.
What to Do When the Rate Changes
When the rate changes, the sequence below takes about an hour and prevents the two failures that actually cost money: paying the old rate into the new year, and forgetting that overtime moves with the base. Because Arkansas gives no annual notice, the trigger for this work is your own calendar check rather than a letter from the state.
Keep the arithmetic behind any change where you can find it later. Arkansas requires minimum wage records to be kept three years, and a wage claim usually arrives long after anyone remembers what happened.
FirstHR is an onboarding and HR platform, not a payroll provider. What it holds is the employee record a rate change touches: who is hourly, whose student certificate expires this term, and who has acknowledged the notice you sent.
Frequently Asked Questions
What is the minimum wage in Arkansas?
The state minimum is $11.00 per hour, and it has been since January 1, 2021. That figure was the final step of the increase Arkansas voters passed as Issue 5 on the November 2018 ballot, which lifted the rate from $8.50 to $9.25, then $10.00, then $11.00. The Department of Labor and Licensing publishes it as the current rate. It binds any employer of four or more persons under the Arkansas Minimum Wage Act, found at Arkansas Code § 11-4-202 through § 11-4-220. A worker paid below it can sue for all of the unpaid wages plus costs and a reasonable attorney fee. If the underpayment was willful, a court can also add liquidated damages of up to the unpaid amount.
Is the Arkansas minimum wage going up?
No. Nothing is on the calendar: the ballot measure behind the last raise completed its final step on January 1, 2021, and Arkansas has no inflation index for its minimum wage, so the figure never rises on its own. It remains $11.00 per hour until the General Assembly changes the law or voters pass another measure. Unlike the states that publish a new figure every October for a January start, Arkansas gives employers no yearly notice, because in most years nothing changes. The sensible habit is a once-a-year look at the Department of Labor and Licensing page, with an extra check after any legislative session or statewide election that dealt with wages.
What is the tipped minimum wage in Arkansas?
The floor for tipped staff is $2.63 per hour in cash wages. Above that cash wage, an employer can credit tips against the minimum, using a gratuity allowance capped at $8.37 per hour. That cap is the gap between the $11.00 minimum and $2.63 and appears on the state notice every covered employer must post. The allowance works only to the extent tips really came in, so in a week when they fall short, the employer pays the gap in cash. Jobs where tips are a customary, recognized part of pay count as tipped occupations, and the state rules give waiters, waitresses, bellhops, beauty operators, and barbers as examples. Any other job counts only when the worker takes in more than $20 a month in tips.
Does the Arkansas minimum wage apply to a business with fewer than four employees?
No. In any workweek when a business employs fewer than four employees, the Arkansas Minimum Wage Act does not count it as an employer, so a three person shop falls outside the state rate that week. Federal law is what usually settles the question instead: if the Fair Labor Standards Act reaches the business or the individual worker, $7.25 per hour is the minimum. Check the headcount carefully before relying on this. Under the state rules, exempt staff still count toward the four, which means an owner with two exempt managers and two hourly workers runs a covered business. The state overtime requirement also stops applying below four employees.
Can I pay a student or a teenager less than $11.00 in Arkansas?
Only with a certificate in hand, and never below 85 percent of the rate, which is $9.35 per hour. The usual route is a full-time student certificate of eligibility from the Division of Labor, which the employer must hold before the student starts; a United States Department of Labor certificate can stand in for it, though every other condition still applies. The student has to be enrolled full time at an accredited school in Arkansas, or at a qualifying school in the neighboring state for a student living in a border town, and can work no more than 20 hours a week during the school term and 40 a week outside it. Learners, student learners, and apprentices can be paid at that level too, provided the employer holds current, valid certification issued by the United States Department of Labor. Age alone never lowers the pay: Arkansas has no general youth or training wage tied to age, so a covered employer owes an 18-year-old new hire without a certificate the full $11.00.
Do any Arkansas cities have their own minimum wage?
No. Every covered employer in the state works from a single statewide figure, with no local rates layered on top. The Department of Labor and Licensing publishes one number for all of Arkansas, and none of the state’s cities or counties has a separate rate. A business in Little Rock, Fayetteville, Fort Smith, Springdale, or Jonesboro owes $11.00 per hour, the same as one in a town of 500. If you run sites in several Arkansas cities, payroll carries one rate rather than one per location. You also skip the city-by-city ordinance research that can take up an afternoon in California or Washington, because there is nothing local to look up.
Do I have to post a minimum wage poster in Arkansas?
Yes, as long as the state act covers your business. The required sheet is the department’s one-page Notice to Employer and Employee, which covers minimum wage, overtime, child labor, and wage collection, and it states on its face that employers under the Minimum Wage Act must display it where all employees can see it. The state rules back that up: each establishment with covered employees needs a division-approved notice in a spot that is both conspicuous and accessible. You can download it free from the department, which warns that skipping required postings can lead to penalties and fines. The federal Fair Labor Standards Act poster is a separate requirement that sits alongside the state notice.