Fair Labor Standards Act in Iowa: Pay, Breaks, and Child Labor

The Fair Labor Standards Act sets the wage, overtime, and child labor floor for most Iowa workplaces, and Iowa law adds a handful of rules on top: a higher cash wage for tipped employees, specific pay-timing and deduction limits under Iowa Code Chapter 91A, and a 2023 rewrite of the state’s child labor statute that is more permissive than the FLSA in several places. Where the two laws overlap, the stricter one governs.

Minimum Wage in Iowa

Iowa’s minimum wage is $7.25 per hour, unchanged since 2008 and identical to the federal floor.¹ There is no separate state rate to track.

The picture changes for tipped workers. Iowa caps the tip credit at 40 percent of the minimum wage, so tipped employees must receive at least $4.35 per hour in cash wages before tips are counted.² Federal law alone would allow $2.13. Iowa’s higher floor controls for work performed in the state, and if tips plus the cash wage don’t reach $7.25 in any workweek, the employer has to make up the shortfall. Employers must tell workers in advance that they are taking the tip credit, and managers and supervisors cannot keep any share of another employee’s tips or draw from a tip pool.³

Two other subminimum rates exist. Iowa permits a $6.35 training wage for workers under 18 during their first 90 calendar days on the job; after that, full minimum wage applies regardless of age. And employers who hold a certificate from the U.S. Department of Labor’s Wage and Hour Division may pay subminimum wages to workers whose disabilities affect their productivity for the specific work being performed, but the certificate must be in place before any subminimum wage is paid.⁴

Overtime

Iowa has no separate overtime law, so the FLSA controls entirely. Non-exempt employees get one and a half times their regular rate for every hour beyond 40 in a workweek.⁵ Overtime cannot be waived in an employment agreement, and hours cannot be averaged across two or more weeks to avoid it.

The regular rate is not always the base hourly wage. Non-discretionary bonuses, shift differentials, and commissions generally fold into it, which raises the overtime premium above what a straight hourly calculation would produce. Employers who miscalculate the regular rate can face back-pay claims stretching years.

Travel and Training Time

Not every minute away from the workstation counts as hours worked, but the line trips up employers. A normal commute is not compensable, but travel between job sites during the workday is. A one-day assignment in another city requires paying for travel time, minus the worker’s usual commute.⁶

Mandatory training, lectures, and meetings count as work time unless all four of these are true: the event is outside normal hours, attendance is voluntary, the content is not directly related to the job, and no productive work happens during it. Miss any one and the time is compensable and counts toward the 40-hour threshold.⁶

Exempt Employees

Iowa follows the federal exemption framework with no additional state tests. To qualify for the common white-collar exemptions, an employee must earn at least $684 per week ($35,568 annually) on a salary basis. The Department of Labor tried to raise this threshold in a 2024 rulemaking, but a federal court in Texas vacated the rule in November 2024, leaving the 2019 threshold in place for enforcement.⁷

A separate highly compensated employee test covers workers earning at least $107,432 per year (with at least $684 per week in salary). They face a relaxed duties test: customarily and regularly performing at least one exempt duty is enough, rather than satisfying a full single-category duties test.⁷

Salary alone doesn’t make anyone exempt. The actual work has to fit one of these categories:

Executive: primary duty is managing the business or a recognized department, regularly directing at least two full-time employees, with real authority over hiring, firing, or promotion decisions.
Administrative: primary duty is office or non-manual work directly related to management or general business operations, with discretion and independent judgment on significant matters.
Professional: work requires advanced knowledge in a field of science or learning, customarily acquired through prolonged specialized education.
Outside sales: primary duty is making sales or obtaining orders away from the employer’s place of business. No salary threshold applies.
Computer employees: systems analysts, programmers, software engineers, and similar roles. These workers can be paid at least $27.63 per hour instead of the weekly salary.

The employer carries the burden of proof on classification. Misclassification is one of the most common FLSA violations and clusters in industries where job titles sound managerial or professional but the actual work lacks the required independent judgment or authority.

How and When Iowa Requires You to Be Paid

Iowa Code Chapter 91A layers state pay-timing and deduction rules on top of the FLSA.

Pay Frequency

Employers must pay wages at least monthly, semimonthly, or biweekly on regular paydays designated in advance. No payday can fall more than 12 days (excluding Sundays and legal holidays) after the end of the pay period in which the wages were earned.⁸ Commissions can be settled at longer intervals, but no more than 12 months between true-ups.

Final Paychecks

When an employee is terminated or suspended, all wages earned through the last day of work are due by the next regular payday for that pay period.⁹ There is no accelerated deadline for involuntary terminations. Commissioned employees get any difference between credits already paid and actual commissions earned settled within 30 days of separation.

Accrued vacation, holiday, and sick leave is owed at termination only if the employer’s own policy or an agreement says so. Iowa doesn’t independently require vacation payout, but a handbook promise becomes enforceable as wages.

Deductions

Employers can only withhold amounts required by law (taxes, court orders) or amounts the employee has authorized in writing for a purpose that benefits the employee.¹⁰ On top of that baseline:

Shortages from a till, cash box, or register used by more than one person cannot come out of any employee’s wages. A narrow exception exists for a full-time manager who has signed a written agreement accepting responsibility for shortages within 45 days before the most recent payday.
Lost or stolen property cannot be deducted unless the item was specifically assigned to the employee and the employee signed a written acknowledgment of receipt.
The cost of personal protective equipment required for the job cannot be deducted, except for clothing or footwear the employee can also use off the clock.

Breaks

Neither federal law nor Iowa law requires meal or rest breaks for adult employees.¹¹ When an employer chooses to offer short breaks of about 5 to 20 minutes, those breaks are paid work time under the FLSA and count toward the 40-hour threshold. Meal periods of 30 minutes or more are unpaid only when the employee is fully relieved of duties; someone who eats at their desk while answering phones is still working. Minors under 16 do get a state break guarantee: any shift of five hours or more must include an unpaid intermission of at least 30 minutes.¹²

Child Labor: Iowa vs. Federal

Iowa rewrote its child labor rules in 2023, and state law is now more permissive than the FLSA in several respects. When both laws apply, the stricter standard governs. For most Iowa employers, that means the federal limits are the ones that actually control hours and occupations, because the FLSA covers virtually all businesses with at least $500,000 in annual revenue.

14- and 15-Year-Olds

Iowa allows workers under 16 to work between 7:00 a.m. and 9:00 p.m. during the school year, with the evening limit extending to 11:00 p.m. from June 1 through Labor Day. State law caps hours at six per school day and 28 per school week, and eight per day and 40 per week when school is out.¹²

Federal limits are tighter almost everywhere. Under the FLSA, 14- and 15-year-olds may work no more than three hours on a school day, eight hours on a non-school day, and 18 hours in a school week. Permitted hours run from 7:00 a.m. to 7:00 p.m., extending to 9:00 p.m. only between June 1 and Labor Day.¹³ For any FLSA-covered employer, the federal limits are what to schedule to.

16- and 17-Year-Olds

Iowa places no state hour restrictions on 16- and 17-year-olds; they may work the same hours as adults.¹² The 2023 law also allows them to serve alcohol in restaurants where the kitchen is operating, with written parental permission and at least two employees aged 18 or older present during the minor’s shift.

Hazardous-work prohibitions still apply to everyone under 18 under both laws. Roofing, excavation, manufacturing, exposure to toxic chemicals, and operation of certain heavy machinery are off-limits regardless of hours.

Work Permits

The 2023 overhaul repealed Iowa’s work permit requirements, striking sections 92.10 through 92.16.¹² Some verification pieces survive: minors under 16 working during regular school hours must submit written proof they are legally excused from school, and 16- and 17-year-olds in work-based learning programs need written permission from both a parent and the school.

Records Employers Must Keep

Under the FLSA, payroll records covering hours worked, pay rates, and deductions must be preserved at least three years from the last entry.¹⁴ Supporting records such as wage computation worksheets and collective bargaining agreements must be kept at least two years.

Iowa adds a paystub requirement. On each regular payday, employers must give every employee a statement showing hours worked, wages earned, and deductions taken.¹⁵ Employees can request a more detailed written, itemized breakdown of how wages and deductions were calculated, and the employer must provide it within 10 working days. When employers can’t produce time or pay records in a dispute, courts tend to credit the employee’s version of hours and wages owed.

Filing a Wage Claim

Iowa workers don’t have to pick between federal and state enforcement; both tracks are open.

At the federal level, the U.S. Department of Labor’s Wage and Hour Division investigates FLSA complaints and can require employers to pay back wages. Employees can also sue privately. In either channel, a successful unpaid-wage claim recovers the amount owed plus an equal amount in liquidated damages, effectively doubling the recovery.¹⁶ An employer can avoid the liquidated damages only by proving the violation was made in good faith and with reasonable grounds to believe the pay practices were lawful, which is a hard bar. The FLSA statute of limitations is two years from the violation, or three years if the violation was willful.¹⁷

At the state level, the Iowa Department of Inspections, Appeals, and Licensing (DIAL) handles wage complaints. Workers claiming up to $6,500 in unpaid wages can file directly with DIAL rather than going to court.¹⁸ Above that threshold, a lawsuit is the usual path. DIAL also oversees child labor compliance under Iowa Code Chapter 92.

1
U.S. Department of Labor. State Minimum Wage Laws
2
U.S. Department of Labor. Minimum Wages for Tipped Employees
3
U.S. Department of Labor. Fact Sheet 15B – Managers and Supervisors Under the Fair Labor Standards Act and Tips
4
U.S. Department of Labor. Subminimum Wage
5
eCFR. 29 CFR Part 778 – Overtime Compensation
6
U.S. Department of Labor. Fact Sheet 22 – Hours Worked Under the Fair Labor Standards Act
7
U.S. Department of Labor. Earnings Thresholds for the Executive, Administrative, and Professional Exemption
8
Iowa Legislature. Iowa Code 91A.3 – Mode of Payment
9
Iowa Legislature. Iowa Code 91A.4 – Employment Suspension or Termination
10
Iowa Legislature. Iowa Code 91A.5 – Deductions from Wages
11
U.S. Department of Labor. Breaks and Meal Periods
12
Iowa Legislature. Iowa Code Chapter 92 – Child Labor
13
U.S. Department of Labor. Fact Sheet 43 – Child Labor Provisions of the Fair Labor Standards Act
14
eCFR. 29 CFR 516.5 – Records to Be Preserved 3 Years
15
Iowa Legislature. Iowa Code 91A.6 – Notice and Recordkeeping Requirements
16
Office of the Law Revision Counsel. 29 USC 216 – Penalties
17
Office of the Law Revision Counsel. 29 USC 255 – Statute of Limitations
18
Department of Inspections, Appeals, & Licensing. Wage Claims FAQ