How do Texas wage, overtime and meal break laws work in 2026?
Texas adds nothing to federal law. The minimum wage is $7.25, overtime is 1.5 times pay after 40 hours in a week, and there is no daily overtime and no state meal-break rule.
· Texas, United States guide
Illustration · Austin, Texas
Texas is one of the simplest wage states in the country, because it adds almost nothing of its own. The minimum wage is the federal $7.25, adopted by reference from the US DOL Wage & Hour Division, with the federal tipped cash floor of $2.13 an hour where a tip credit applies.
Overtime follows the federal week under the Fair Labor Standards Act (FLSA): 1.5 times pay after 40 hours in a workweek. There is no daily overtime and no state meal or rest break for adults, so the real risk is exemption, not the rate.
What is the Texas minimum wage in 2026?
The Texas minimum wage is $7.25 an hour in 2026. Texas adopts the federal rate by reference and sets no higher figure of its own, so $7.25 is the floor statewide.
Tipped staff can be paid a cash wage of $2.13 an hour if tips bring total pay to $7.25. If they fall short, you make up the difference that pay period.
Texas has no scheduled increase and no automatic inflation adjustment, so the $7.25 floor holds until federal law moves. Under the Texas Minimum Wage Act (Labor Code Ch. 62), cities and counties are barred from setting their own higher minimum wage, so the same rate applies in Austin, Houston, Dallas and rural counties alike. There is no city-by-city map to track, unlike states such as Oklahoma or Louisiana where the federal floor also holds statewide.
The tip credit is the one calculation that bites. A tipped worker paid $2.13 in cash must reach $7.25 an hour once tips are counted, and the burden of proving they did sits with you. Track tips against the floor each pay period and top up any shortfall, or the whole credit can be disallowed in an audit. Review the Texas Payday Law guidance from the Texas Workforce Commission (TWC) for tip and wage payment requirements.
How does overtime work in Texas?
Texas pays overtime at 1.5 times the regular rate after 40 hours in a workweek, exactly as the FLSA requires. The state has no overtime statute of its own.
There is no daily overtime in Texas. A worker can do a twelve-hour shift with no premium, as long as the week stays at or under 40 hours. Only hours past 40 in the seven-day week count.
Hire someone in Texas and you owe 1.5x the regular rate for every hour worked past 40 in a seven-day workweek. Texas has no state overtime law and no daily-overtime rule. A four-day, ten-hour schedule costs no premium because the week lands exactly on 40 hours.
Source: Texas Workforce Commission, the FLSA: what it does and does not do
This is where Texas differs from states like California and Nevada, which add daily overtime after eight hours. The regular rate still has to include non-discretionary bonuses and commissions under DOL Wage & Hour rules, so overtime is calculated on total earnings, not base pay alone. Get the base wrong and every overtime hour is underpaid. Compare this treatment with Oklahoma's overtime rules, which also follow federal law without state additions.
What are the meal and rest break rules in Texas?
Texas has no state meal or rest break law for adult employees. You are not required to give any break during an eight, ten or twelve-hour shift, though most employers schedule them as a matter of practice.
Federal rules under the FLSA hours-worked rules only decide whether a break you do give is paid. A short rest break of 20 minutes or less counts as paid time. A genuine meal break of 30 minutes or more, fully relieved of duty, can be unpaid.
Because Texas mandates nothing, break policy is yours to set, but the federal pay rule still governs how it costs out. A rest break of 20 minutes or less counts as hours worked and is paid, so it folds into the 40-hour overtime count. An unpaid meal break only works if the employee is fully relieved of duty. A working lunch at a desk is paid time.
The practical exposure is the interrupted meal break. If you dock 30 minutes for lunch but the employee answers calls or covers a station, that time is compensable under DOL guidance, and across a year it adds up to back-pay plus liquidated damages. Either protect the break or pay for it. Do not assume an unpaid meal break is free just because Texas does not require one. Check your Texas paid leave obligations alongside break policy when setting up schedules.
Who is exempt under federal law in Texas?
An employee is exempt from overtime only if they are paid at least $684 a week ($35,568 a year) on a salary basis and meet the federal duties test for an executive, administrative or professional role.
Salary alone is not enough. A worker earning over $684 a week who does not meet the duties test is still non-exempt and owed overtime after 40 hours.
The $684 weekly threshold is the 2019 federal level, restored after the 2024 increase was struck down by a federal court in Texas and formally rolled back by the US Department of Labor in May 2026. The in-force 2026 figure is $684 a week, not the higher number some payroll tables still show.
Misclassification is the expensive Texas error. Because the state piles on no extra wage rules, the exemption test is the main compliance surface for a salaried hire. If the salary or duties test is not met, every over-40-hour week becomes back-pay, often doubled as liquidated damages. Test the duties, not just the salary, before you classify anyone as exempt. If you are also reviewing your Texas hiring structure, see the Texas termination and at-will exceptions guide and the Texas state tax and unemployment insurance guide alongside this page.
How Teamed runs Texas wage and hour compliance
Teamed becomes your legal employer of record in Texas for $599 per employee per month flat. Zero FX mark-up. We run the timesheet-to-payslip path so overtime, the $7.25 floor and the tip credit are calculated correctly, every cycle.
You set the schedule. Teamed applies the 1.5x rate after 40 hours, costs tipped roles against $2.13, and tests every salaried hire against the $684 exemption bar before it becomes back-pay. Everything runs on one platform.
Real HR and legal experts handle your Texas hires and know the exemption bar, the tip-credit top-up and the regular-rate maths by heart. An actual person, not a chatbot or a pooled queue. Overtime, premium pay and any tip make-up are computed and pass through at cost, itemised on every invoice. No setup fee, no exit fee.
Contractor onboarding, EOR payroll and entity graduation all live on one platform: a Texas contractor who converts to W-2 keeps their record, and that same employee can graduate to your own US entity without switching systems. Use the Crossover Calculator to see the month the model flips, or the Employer Cost Calculator to price a Texas hire before you commit. EOR is the right model for a first Texas hire, until it isn't. Teamed's $599 flat rate covers all of this with no FX mark-up anywhere in the stack.
The Texas mistake we see most is not overtime, it is exemption. Employers assume a salary over the threshold makes someone exempt, so they pay no overtime. If the duties test is not met, that worker is non-exempt, and every long week is back-pay. In a state with no extra wage rules, classification is the whole game, and we test the duties before anyone is set to exempt.
Texas barely writes its own wage rules. It borrows the federal ones.
No daily overtime, no mandated break, a $7.25 floor and 1.5 times pay after 40 hours. Simple on paper.
Get the duties test wrong and the simplest wage state in the country hands you a back-pay bill. Until it isn't the right model, EOR keeps the risk off your books.
