Arkansas — Wage & Hour

Arkansas requires a minimum wage of $11.00 per hour, effective January 1, 2021. This rate applies to employers with four or more employees. Employers with fewer than four employees are not covered by the Arkansas Minimum Wage Act, though they may still be subject to the federal minimum wage under the Fair Labor Standards Act.

Source: Arkansas Department of Labor and Licensing – Minimum Wage and Overtime

Arkansas requires employers to pay non-exempt employees overtime at 1.5 times the regular rate for all hours worked beyond 40 in a workweek, under Ark. Code § 11-4-211(a). The state does not impose daily overtime thresholds (such as over 8 hours in a day) or weekend or holiday premium pay. Agricultural employees are exempt from Arkansas overtime under Ark. Code § 11-4-211(b). The Arkansas Minimum Wage Act applies to employers with four or more employees.

Source: Arkansas Department of Labor and Licensing – Minimum Wage and Overtime

When an Arkansas employer discharges an employee, Arkansas Code § 11-4-405(a) requires the employer to pay all wages due by the next regular payday. Unlike some states that mandate immediate payment or payment within a fixed number of days from termination, Arkansas keys the deadline to the employer's existing payroll cycle — if an employee is terminated on a Monday and the next regular payday is two weeks later, the final paycheck is due on that payday.

Double-wage penalty for late payment. If the employer fails to pay the final wages within seven (7) days of the next regular payday, Ark. Code § 11-4-405(b) provides that the employer "shall owe the employee double the wages due." The statute imposes this penalty by its own terms; the text does not expressly require the employer to have acted willfully or in bad faith, nor does it grant the employer any affirmative defense for late payment. The seven-day period begins the day after the next regular payday; if the payday is Friday the 15th and the employer pays on Friday the 22nd, the statute provides that the employer owes double the wages due.

Coverage. Section 11-4-405 applies to employers that discharge employees. The Arkansas Minimum Wage Act (under which this provision sits) generally covers employers with four or more employees under Ark. Code § 11-4-203, though the final-paycheck penalty provision at § 11-4-405 does not expressly repeat that threshold. Earlier versions of § 11-4-405 applied broadly to "all companies and corporations doing business in this state," and the provision has been applied in that context.

Voluntary resignation. Arkansas has no parallel statute mandating final-paycheck timing when an employee resigns or quits voluntarily. Employers must still pay all earned wages, but the timing defaults to the employer's ordinary payroll schedule or the parties' agreement; the double-wage penalty under subsection (b) applies only to employer-initiated discharge. See the section on final-paycheck timing for voluntary resignations for details.

What wages are "due." "All wages due" includes regular wages for hours worked through the last day of employment, any earned but unpaid overtime, and commissions or bonuses that have become payable under the employer's established policy or a written agreement. Arkansas law does not require payout of accrued but unused vacation or PTO upon separation unless the employer's written policy or a contract affirmatively provides for it; in the absence of such a policy, accrued leave is not a "wage due" under § 11-4-405.

Enforcement. Employees may file a wage claim with the Arkansas Department of Labor and Licensing, Labor Standards Division. The Arkansas Minimum Wage Act at Ark. Code § 11-4-218(g) provides a two-year statute of limitations for claims seeking unpaid wages; a separate three-year limitations period may apply if the employer's violation is deemed willful (mirroring the FLSA framework at 29 U.S.C. § 255(a)). Under § 11-4-218(a), an employee who prevails on a wage claim may recover the unpaid wages, costs, and reasonable attorney's fees; § 11-4-218(a)(2) separately authorizes liquidated damages (up to the amount of wages owed) if the employee proves a willful violation of the Arkansas Minimum Wage Act. The interaction between the § 11-4-405(b) double-wage penalty for late final pay and the § 11-4-218(a)(2) liquidated-damages provision is not addressed in the statute; practitioners should consult controlling case law or administrative guidance for their fact pattern.

Source: Ark. Code § 11-4-405 – Arkansas Department of Labor, Statutes Regulating Wages and Hours in Arkansas (PDF) Source: Ark. Code § 11-4-203, § 11-4-218 – Arkansas Department of Labor, Statutes Regulating Wages and Hours in Arkansas (PDF)

Arkansas allows employers to pay tipped employees a reduced cash wage of $2.63 per hour, provided that the employee's tips bring total compensation to at least the full Arkansas minimum wage of $11.00 per hour. Ark. Code § 11-4-212(a) authorizes an "allowance for gratuities" of no less than $3.62 per hour for employees "engaged in any occupation in which gratuities have been customarily and usually constituted and have been recognized as a part of remuneration for hiring purposes," as long as (1) the employee actually received that amount in gratuities and (2) the employer pays at least $2.63 per hour in cash wages other than gratuities.

Tip credit mechanics. The tip credit is the amount by which the employer reduces the cash wage below the full minimum wage, counting the employee's tips toward the minimum-wage obligation. Under current Arkansas law, the maximum tip credit is effectively $8.37 per hour ($11.00 minimum wage minus $2.63 required cash wage), though the statute references a minimum gratuity allowance of $3.62. The employer may take the tip credit only for hours the employee actually performs tipped work; the credit is unavailable for hours spent in non-tipped duties.

Make-up pay obligation. If an employee's tips in a workweek, when added to the $2.63 hourly cash wage, do not equal or exceed $11.00 per hour for all hours worked, the employer must pay the difference. This obligation is measured weekly, not averaged over longer pay periods. Arkansas regulations (11 CAR § 11-705) confirm that the employer bears the burden of ensuring total compensation meets the minimum wage in every workweek.

Dual jobs / non-tipped work. Arkansas regulation 11 CAR § 11-705(a)(1)(C) contains a 20-minute rule for non-tipped tasks: "Whenever an employee is required to work twenty (20) minutes or more in any occupation in which gratuities have not been recognized as part of the remuneration for hiring purposes, the rate for the entire hour shall be at least the applicable minimum wage rate without a tip credit." If a tipped employee spends 20 or more minutes in an hour on duties unrelated to the tipped occupation (e.g., extensive prep work, cleaning tasks outside normal service side work), the employer must pay the full $11.00 minimum wage for that entire hour and may not claim a tip credit.

Tip pooling. Arkansas permits tip pooling or tip-sharing arrangements. Under 11 CAR § 11-705(e)(3)(c), when employees practice tip splitting — such as servers sharing a portion of their tips with bussers — "both the amounts retained by the waiters and those given the bussers are considered tips of the individual employees who retain them." For purposes of the tip credit, the employer may count only the tips the employee actually receives and retains after any pooling or sharing. Tips contributed to a pool that are redistributed to other employees cannot be counted toward the contributing employee's tip credit; only the net amount the employee keeps (whether received directly or from the pool) counts.

Recordkeeping requirements. Employers who utilize a tip credit must maintain detailed records under 11 CAR § 11-202(c) (also cited as 11 CAR § 11-705(f)). Required records include:

• A symbol, letter, or other notation identifying each tipped employee;
• Weekly or monthly tip amounts reported by the employee to the employer (may consist of IRS Form 4070 reports);
• The amount by which wages have been increased by tips (the tip credit claimed) for each employee.

If the employer fails to maintain these records, the employer is not entitled to take a tip credit unless the employer can prove that the employee actually received and retained tips in each workweek equal to or greater than the tip credit claimed. 11 CAR § 11-705(f)(2).

Notice to employees. While Arkansas statute and regulations do not explicitly mandate that employers provide advance written notice to employees before taking a tip credit (unlike the federal FLSA notice requirement at 29 U.S.C. § 203(m)), the employer must ensure that the employee actually receives the required gratuity amount — which presupposes that the employee understands the wage structure. Federal FLSA notice requirements apply concurrently: before taking a tip credit, the employer must inform the employee of the tip credit provisions, the amount of cash wage and tip credit, that tips belong to the employee (subject to valid tip pooling), and that the tip credit will not exceed the value of tips actually received. Employers subject to both state and federal law should comply with the federal notice rule as a practical matter.

Interaction with federal law. Because the Arkansas minimum wage ($11.00) exceeds the federal minimum wage ($7.25), and Arkansas permits a lower cash wage ($2.63) than the federal tipped minimum ($2.13), Arkansas tipped employees are entitled to the higher state cash wage. Employers must comply with whichever standard — state or federal — provides the greater benefit to the employee on every element (cash wage, total compensation, and tip credit limitations).

Source: Ark. Code § 11-4-212 – Arkansas Department of Labor, Statutes Regulating Wages and Hours in Arkansas Source: 11 CAR § 11-705 – Code of Arkansas Rules, Tipped Employees Source: Arkansas Department of Labor – Minimum Wage and Overtime Rules (PDF)

Arkansas has no statute requiring employers to pay final wages by a specific deadline when an employee voluntarily resigns or quits. Ark. Code § 11-4-405 — the statute that mandates payment by the next regular payday and imposes a double-wage penalty for late payment — applies only to discharges (employer-initiated terminations). The statute's text expressly limits its scope: "An employer that discharges an employee is required to pay all wages due by the next regular payday." Subsection (b)'s penalty ("An employer that fails to make the payment required under subsection (a) of this section within seven (7) days of the next regular payday shall owe the employee double the wages due.") similarly references only the discharge-timing rule in subsection (a).

When payment is due upon voluntary separation. Although Arkansas imposes no statutory final-paycheck deadline for resignations, employers must still pay all earned wages. The timing defaults to the employer's ordinary payroll schedule. If an employee resigns mid-pay period and the employer's next regular payday is two weeks later, Arkansas law does not compel earlier payment; the employer may lawfully wait until that payday. If the employer's written policy, employee handbook, or employment agreement affirmatively promises faster payment (e.g., "final pay within 72 hours of separation regardless of reason"), that contractual obligation binds the employer, but absent such a promise Arkansas statute imposes no accelerated deadline.

No double-wage penalty for late payment after resignation. Because Ark. Code § 11-4-405(b) applies only to discharges, the double-wage penalty is unavailable to employees who quit. If an employer delays paying earned wages beyond the next regular payday following a voluntary resignation, the employee may file a wage claim with the Arkansas Department of Labor and Licensing to recover the unpaid wages, but the automatic doubling penalty under § 11-4-405(b) does not attach. The employee's remedy is limited to the unpaid amount itself (plus potential interest or costs if a court action is necessary), not the statutory doubling.

What wages are due. "Earned wages" include regular pay for all hours worked through the last day, earned overtime, and commissions or bonuses that have become payable under a clear written policy or agreement. Arkansas law does not require payout of accrued but unused vacation or paid time off upon separation unless the employer's written policy or contract affirmatively provides for it. In the absence of such a policy, accrued leave is not a "wage due."

Contrast with discharge rule. An employer who discharges an employee must pay all wages due by the next regular payday. If the employer fails to pay within seven (7) days after that payday, the double-wage penalty under Ark. Code § 11-4-405(b) automatically attaches. The distinction — mandatory deadline and penalty for discharge; no deadline and no penalty for resignation — is stark. HR practitioners and payroll teams should flag the separation type (discharge vs. quit) at the outset to ensure compliance and avoid incorrectly applying the discharge rule to a resignation or vice versa.

Coverage. The Arkansas Minimum Wage Act (under which § 11-4-405 sits) generally covers employers with four or more employees, though § 11-4-405 itself does not expressly repeat that threshold. Federal wage-payment obligations under the Fair Labor Standards Act continue to apply: employers must pay all earned wages on the next regular payday or sooner, and willful failure to pay can give rise to federal liquidated damages and criminal penalties under the FLSA. Employers subject to both state and federal law must comply with whichever standard is more protective, but for voluntary resignations Arkansas statute simply does not speak.

Source: Ark. Code § 11-4-405 – Arkansas Department of Labor, Statutes Regulating Wages and Hours in Arkansas (PDF) Source: Arkansas Department of Labor and Licensing – FAQs