State Specific

Alabama minimum wage

January 6, 2026state-laws

Alabama minimum wage (2026): what employers must pay and post

If you’re searching for Alabama minimum wage, the key compliance point is straightforward: Alabama does not set a separate state minimum wage, so most employers follow the federal minimum wage under the Fair Labor Standards Act (FLSA). That means your pay practices, overtime rules, tip credit handling, and required workplace postings must be aligned with federal standards—unless a local requirement applies (Alabama law limits local minimum wage ordinances, discussed below).

This guide is written for HR teams and business owners who need an actionable, compliance-focused overview for SwiftSDS customers.

Alabama minimum wage: the current rule

Alabama has no state minimum wage (federal law governs)

Alabama does not have a statewide minimum wage statute that sets a rate above (or different from) federal law. In practice, that means the federal minimum wage rate of $7.25/hour (under the FLSA, 29 U.S.C. § 206) is the baseline for covered, non-exempt employees.

Most Alabama employers are covered by the FLSA through:

  • Enterprise coverage (e.g., annual gross volume of sales/business of $500,000+), or
  • Individual coverage (employee engages in interstate commerce activities)

Action steps for Alabama employers

  • Confirm FLSA coverage (many employers are covered even when they operate only in Alabama).
  • Ensure your payroll system enforces at least $7.25/hour for all hours worked by non-exempt employees (subject to valid tip credit rules).
  • Ensure overtime is calculated correctly (see below).

Local minimum wage in Alabama: preemption considerations

Can cities set a higher minimum wage in Alabama?

Alabama has a state preemption law that restricts local governments from setting different minimum wage requirements. In other words, even if a city wants to adopt a higher local wage, Alabama law generally blocks it.

Compliance takeaway: For most employers, there is no separate Birmingham/Montgomery/Mobile local minimum wage that overrides federal minimum wage. Your baseline remains the FLSA.

Because local and federal rules can change, it’s good practice to monitor multi-state and federal updates using SwiftSDS’ broader compliance resources, including the Employment legislation list hub.

Related pay requirements that matter in Alabama (FLSA)

Even though “minimum wage” is the common search, wage compliance typically fails on related requirements—especially overtime and tipped wages.

Overtime in Alabama: 1.5× after 40 hours

Alabama follows the FLSA overtime requirement: non-exempt employees must receive 1.5× their regular rate for hours worked over 40 in a workweek (29 U.S.C. § 207).

Action steps

  • Define your workweek (fixed, recurring 168-hour period).
  • Track all hours worked (including certain travel time, required training, and “off-the-clock” work risks).
  • Audit exempt vs. non-exempt classifications; misclassification is a frequent liability trigger.

Tipped employees: federal tip credit rules apply

If you take a tip credit, ensure your practices meet federal standards (including notice and ensuring tips bring the employee to at least the federal minimum wage for the pay period). When tip credit rules are mishandled, back wages and damages can accrue quickly.

Alabama required postings: don’t miss the FLSA minimum wage notice

Federal posting requirement (minimum wage + overtime)

If you are covered by the FLSA, you must post the federal minimum wage notice in a conspicuous place. SwiftSDS customers often include both English and Spanish versions where appropriate:

If you operate in specialized sectors, there are also role-specific FLSA posters such as:

Action steps

  • Post the correct FLSA notice(s) at each worksite (and provide electronic access for remote employees where applicable).
  • Keep posters current—outdated posters are a common compliance gap during audits.

Multi-state context: Alabama vs. other minimum wage states (for HR teams operating across states)

If you manage employees in multiple jurisdictions, Alabama’s “federal-only” structure contrasts sharply with states that set higher rates or different wage rules. HR teams often compare Alabama to states searched alongside it, such as california minimum wage, minimum wage in texas, georgia minimum wage, indiana minimum wage, arkansas minimum wage, minimum wage louisiana, and minimum wage in mississippi.

California minimum wage: higher rates and more state complexity

California is frequently searched with phrases like “how much is minimum wage in california” and even “what is the minimum salary in california” (note: “salary” is a different compliance concept tied to exempt classifications). California also has layered state and local rules, and broader employment compliance obligations.

For California compliance context, SwiftSDS readers can explore:

Why this matters for Alabama employers: If you use a single national pay policy, Alabama may be easy—but your highest-wage jurisdiction can drive pay bands, offer letters, and exemption/salary threshold strategy.

Neighboring and southern states: don’t assume they match Alabama

Employers often assume the Southeast is uniform. It isn’t. For example:

  • Arkansas has a state minimum wage (often higher than federal).
  • Texas, Louisiana, Mississippi, and Alabama commonly rely heavily on federal minimum wage (though local/industry rules and federal contractor requirements can still change outcomes).
  • Georgia has its own state wage statute, but FLSA coverage and the federal floor usually control for covered employers.

Action step: Maintain a state-by-state wage matrix and update it at least annually (and whenever you open a new location).

Practical compliance checklist for Alabama employers

1) Confirm coverage and classify workers correctly

  • Verify whether your business is covered by FLSA enterprise/individual coverage.
  • Audit exempt vs. non-exempt classifications and duties.

2) Set pay rates and tip practices to meet federal rules

  • Ensure non-exempt employees earn at least $7.25/hour for all hours worked.
  • If using tip credit, document tip credit notices and reconcile tips to minimum wage.

3) Configure overtime calculations

  • Pay 1.5× regular rate for 40+ hours in a workweek.
  • Include required remuneration in the “regular rate” where applicable (bonuses can affect calculations).

4) Post required wage notices

  • Post the current FLSA Employee Rights notice (and Spanish version if needed).
  • Keep postings accessible for remote/hybrid workforces.

5) Coordinate multi-state requirements

If you also have employees outside Alabama, consult SwiftSDS’ broader compliance library, starting with the Employment legislation list, and consider state-specific topics such as arizona sick leave law when you expand into jurisdictions with additional mandates beyond wage rate.

FAQ: Alabama minimum wage

What is the Alabama minimum wage right now?

Alabama does not set a separate statewide rate. For most covered employers, the applicable minimum is the federal minimum wage of $7.25/hour under the FLSA.

Does Alabama allow cities to set a higher local minimum wage?

Generally, no. Alabama law restricts local minimum wage ordinances, so employers typically follow the federal rate statewide (subject to federal coverage and other specific requirements).

What poster do I need to post for minimum wage compliance in Alabama?

Most employers should post the federal Employee Rights Under the Fair Labor Standards Act notice (and the Spanish FLSA version if it’s appropriate for your workforce).

SwiftSDS note: This page provides general compliance information and is not legal advice. For complex scenarios (tipped wage disputes, exemption audits, multi-state payroll harmonization), consult qualified employment counsel.