Mississippi Minimum Wage and Overtime: What a Small Employer Must Follow

Mississippi has no minimum wage law of its own, and no state overtime law either. That does not mean an employer can pay whatever it likes. Federal law sets the floor, and for most small employers that floor is the same $7.25 an hour that applies everywhere else in the country. Mississippi overtime laws work the same way: the federal rules in the Fair Labor Standards Act (FLSA) decide when you owe time-and-a-half.

This guide covers what a Mississippi employer needs to get right: whether the FLSA covers your business, the wage floor, how overtime is calculated, the tipped and youth wage exceptions, and how long to keep payroll records. It is written for the owner who is about to hire the first employee, or who is already running payroll and wants to confirm the basics.

The Short Answer

Most questions about Mississippi minimum wage and overtime come down to five rules. The table below summarizes them, with the source that governs each one.

Rule	What applies in Mississippi	Governing standard
Minimum wage	$7.25 an hour	Federal minimum under the FLSA. Mississippi has no state minimum wage law.
Overtime	One and one-half times the regular rate for hours over 40 in a workweek	FLSA, for nonexempt employees. Mississippi has no state overtime law.
Tipped employees	Cash wage of at least $2.13 an hour, with a tip credit of up to $5.12 an hour, if tips bring pay to $7.25	FLSA
Youth wage	$4.25 an hour for the first 90 consecutive calendar days, for workers under 20	FLSA
Payroll records	Keep for at least three years	U.S. Department of Labor recordkeeping guidance

Mississippi Minimum Wage 2026

For 2026, the minimum wage that applies to most Mississippi workers is $7.25 an hour. Because the state sets no rate of its own, no Mississippi action can raise or lower it. The figure changes only if federal law changes. Confirm the current federal rate on the U.S. Department of Labor state minimum wage table before you set pay rates each year. The Wage and Hour Division home page is at dol.gov/agencies/whd.

The federal minimum reaches only employers covered by the FLSA. If your business is not covered, the federal minimum does not apply to your workers, and no Mississippi law replaces it. That makes coverage the first question to answer.

Step One: Find Out Whether the FLSA Covers You

Coverage does not depend on how small your business is. The FLSA reaches a business in two ways.

• Enterprise coverage applies when the business as a whole meets the Act's annual business volume and commerce tests. If it does, every employee of that business is generally covered, including part-time and hourly staff.
• Individual coverage applies to a particular worker whose job involves interstate commerce or the production of goods for interstate commerce, even when the employer is small and below the enterprise test.

Because a small business can still be covered through individual coverage, do not assume you are exempt because you have few employees. Ask the U.S. Department of Labor Wage and Hour Division to confirm your status for your specific operation before you rely on any exemption.

Exempt Versus Nonexempt Employees

Overtime rules apply only to nonexempt employees. Under the FLSA, certain executive, administrative and professional roles, along with a few others, can be exempt from overtime. The exemption depends on two things: the employee's actual job duties, and whether the employee is paid on a salary basis that meets the federal tests. Job titles do not decide it.

A worker called a "manager" who spends most of the day running the register, and who supervises no one, may well be nonexempt. Misclassifying an employee as exempt is one of the most expensive mistakes a small employer can make, because back overtime is owed for every week the error ran. The salary levels that the duties tests depend on change over time, so confirm current figures with the Department of Labor before you classify anyone as exempt.

How Overtime Works for Mississippi Employers

Nonexempt employees must receive overtime at one and one-half times their regular rate for every hour worked over 40 in a workweek. Three points trip up small employers most often.

• The workweek is fixed. It is any recurring 168-hour period you designate, such as Sunday through Saturday. Hours are counted within that workweek, and you cannot average hours across two weeks to avoid overtime in one of them.
• The regular rate is not always the base hourly wage. It generally includes most payments for work, such as nondiscretionary bonuses and certain shift differentials or piece-rate pay. Calculate the regular rate for the week, then pay one and one-half times that rate for each overtime hour.
• Only hours worked count. Paid time off and holidays generally do not count as hours worked when you test whether an employee passed 40 hours in the week.

Here is an example. An employee earns $12.00 an hour and works 45 hours in one workweek. The first 40 hours pay $480.00. The five overtime hours pay $18.00 each, or $90.00. The total for the week is $570.00. Because Mississippi has no state overtime law, no additional state rule changes that calculation.

Tipped Employees: The $2.13 Cash Wage and Tip Credit

Restaurants, bars, salons and other businesses with tipped staff can use a tip credit, but only within limits. Under the FLSA, the employer may pay a cash wage of at least $2.13 an hour and claim a tip credit of up to $5.12 an hour. Together, the two add up to the $7.25 federal minimum.

The tip credit works only if the employee's tips bring total pay up to at least $7.25 an hour. If tips in a pay period fall short, you must make up the difference in cash. A slow week with few tips means you owe the difference. A $2.13 cash wage alone is not enough to meet the minimum.

Tip pooling and the notice you must give employees about the tip credit carry their own requirements. Confirm those details with the Department of Labor before you set up a tip pool or claim a credit.

The Youth Wage for Workers Under 20

An employer may pay a youth wage of $4.25 an hour to a worker under age 20, but only during the first 90 consecutive calendar days of employment. The 90 days are calendar days, not working days, and they run from the employee's first day on the job. After that period, or once the worker turns 20, the regular $7.25 minimum applies.

The youth wage is a narrow exception. Do not use it as a substitute for an adult worker who is already entitled to the full minimum, and confirm the conditions with the Department of Labor before you rely on it.

Recordkeeping: Keep Payroll Records for Three Years

Employers covered by the FLSA must keep payroll records for at least three years. For each nonexempt employee, your records should show hours worked each workday and each workweek, the regular hourly rate, total wages paid, and overtime pay. For tipped employees, keep records of the cash wage paid and the tip credit claimed. The Department of Labor's recordkeeping guidance lists the full set of required items, so use it as your reference.

Keep these records for three years, including records for former employees. A paper or spreadsheet system is acceptable as long as you can produce the records quickly if the Department of Labor asks for them.

A Practical Compliance Checklist

1. Confirm whether your business is covered by the FLSA, and ask the Wage and Hour Division if you are unsure.
2. Pay at least $7.25 an hour to every covered employee who is not exempt.
3. Write down your fixed workweek and confirm it applies to every nonexempt employee.
4. Classify each salaried role as exempt or nonexempt based on duties and salary tests, not on job title.
5. Pay one and one-half times the regular rate for every hour over 40 in a workweek.
6. If you use a tip credit, confirm the cash wage, the credit limit and your tip pool rules, and cover any shortfall in tips.
7. Track each young employee's age and start date so you know when the youth wage ends.
8. Keep payroll records for at least three years.

What This Guide Does Not Cover

This article covers the federal wage and hour rules that apply in Mississippi, where the state adds no minimum wage or overtime requirement. It does not cover every employment obligation. Payroll tax withholding, workers' compensation and unemployment insurance are separate topics.

Business licensing is also separate. Mississippi issues no general statewide business license. Registering an LLC with the Secretary of State is a registration, not a license, and the Certificate of Formation costs $50. Cities and towns issue their own privilege licenses. Businesses that make retail sales register with the Department of Revenue for a sales tax permit, which carries no fee, through the Mississippi Department of Revenue website.

Where to Get Help

For questions about your specific workforce, start with the U.S. Department of Labor Wage and Hour Division. For general business planning, the Mississippi Small Business Development Center Network offers free advisory help through 19 locations statewide, with a lead center hosted by the University of Mississippi.

Talk to a qualified employment attorney or CPA before you make decisions about exempt classification, back pay, tip pools, or employees who work in more than one state. Those situations turn on facts that a general guide cannot resolve, and a mistake usually costs more to fix than the advice would have cost.

Disclaimer: This article is informational content, not legal or tax advice. Wage and hour rules change, and the figures here reflect research checked on 2026-10-15. Confirm current requirements with the U.S. Department of Labor, and consult a qualified attorney or CPA before acting on anything in this guide.