Iowa Minimum Wage — As of October 2026, the minimum wage in Iowa is $7.25 per hour, unchanged since 2008, with no increase scheduled. Tipped workers may be paid $4.35 per hour in cash as long as tips bring total hourly pay to $7.25 — the employer covers any shortfall. Iowa also allows a lower $6.35-per-hour wage for the first 90 days of a new hire’s employment, and a 2017 law blocks cities from setting higher local minimums.
Employers Covered By Iowa Minimum Wage Law
Generally employers that gross at least $300,000 in sales or business per year must comply with the Iowa Minimum Wage Law. In addition, some types
of employers or “named enterprises” must comply with the law regardless of business “Named enterprises” that must comply with the Iowa Minimum Wage Law
regardless of business volume include: public agencies; hospitals and residential care facilities for the sick, elderly, mentally or physically handicapped or gifted children; schools and preschools; public transportation subject to state or local regulation; most daycares; and employers engaged in construction, laundry and dry cleaning. Certain in-home daycares with five or fewer children and with only one employee, or whose only employees are members of that individual’s immediate family, are excluded from the Iowa minimum wage law. Some types of employers are not required to comply with the Iowa Minimum Wage Law, such as certain employers in agriculture, certain summer camps, and others.
Iowa Overtime — Iowa has no state overtime law, so the federal Fair Labor Standards Act applies: non-exempt employees earn 1.5 times their regular rate for hours over 40 in a week. Common violations include misclassifying employees as independent contractors and calling hourly workers “exempt” based on job titles instead of actual duties. Iowa’s Wage Payment Collection Law governs how and when you’re paid and how you recover unpaid wages.
