Tennessee Wage Theft Laws: Minimum Wage, Overtime, and Final Paycheck Rules

Tennessee has very few state-level wage protections. The state has no minimum wage law, no state overtime statute, and limited final paycheck enforcement. For most Tennessee workers, the federal Fair Labor Standards Act is the primary — and in many cases only — meaningful protection against wage theft.

Minimum Wage in Tennessee (2025)

Tennessee has no state minimum wage law. The federal minimum wage of $7.25 per hour applies to all Tennessee employees covered by the FLSA.

Who is not covered by federal minimum wage. Workers at very small employers (under $500,000 annual gross sales with no interstate commerce involvement) may fall outside FLSA coverage and face no minimum wage requirement at all under Tennessee law. In practice, this affects a limited number of domestic workers and very small local businesses.

No local minimums. Tennessee preempts cities and counties from enacting their own minimum wage ordinances. Nashville, Memphis, and other Tennessee cities cannot set minimum wages above the federal floor.

Tipped employees. The federal tip credit applies: tipped employees can be paid as little as $2.13 per hour if tips bring total compensation to $7.25 per hour. If tips fall short in any workweek, the employer must make up the difference. Tennessee has no additional state-level tip credit rules.

Overtime Pay in Tennessee

Tennessee has no state overtime law. The federal FLSA governs: 1.5 times the regular rate for all hours over 40 in a workweek. There is no daily overtime requirement in Tennessee.

FLSA exemptions. Federal exemptions apply. Executive, administrative, and professional employees earning at least $684 per week on a salary basis may be exempt — but the exemption depends on actual job duties, not job title. Tennessee’s large healthcare and logistics industries generate misclassification claims involving workers whose titles suggest exempt status but whose daily duties are non-exempt.

Auto assembly and manufacturing overtime. Tennessee’s automotive manufacturing sector — anchored by large assembly plants in the Nashville area, Spring Hill, and Chattanooga — employs tens of thousands of workers. Off-the-clock pre-shift startup time, post-shift shutdown time, and mandatory equipment checks that are not compensated generate FLSA back pay claims across this sector.

Final Paycheck Rules in Tennessee

Tennessee’s final paycheck rules are among the least protective in the country:

Under Tennessee Code Annotated § 50-2-103, wages must be paid on the employer’s regular payday schedule. Final wages for separated employees are due on the next regular payday after the last day of work.

Vacation payout. Tennessee does not require employers to pay out accrued vacation upon termination unless the employer’s policy or employment contract explicitly promises it. “Use it or lose it” vacation policies are enforceable in Tennessee.

No state final paycheck penalty statute. Tennessee has no specific penalty statute for employers who fail to pay final wages on time. Workers must rely on the general civil courts or the FLSA to recover unpaid wages — there is no administrative agency with strong enforcement authority over final paychecks.

Tennessee Wage Regulations Act. Tennessee’s primary state wage statute (TCA § 50-2-101 et seq.) requires regular payment of wages and prohibits unauthorized deductions from wages. Employers who make unauthorized deductions (for uniforms, cash shortages, etc.) without written employee authorization violate the Act. However, the enforcement mechanisms are weaker than most comparable state statutes.

Tennessee Department of Labor and Workforce Development

Tennessee’s Department of Labor handles wage complaints, but its enforcement authority is limited:

• File complaints at tn.gov/workforce/workers/labor-standards-and-safety/labor-standards.html
• The Department can investigate and contact employers
• Enforcement powers are more limited than states like California or New York — private lawsuits are often the more effective path

The federal option is stronger. For most Tennessee workers, filing with the federal Wage and Hour Division is more effective than the state process. The WHD has subpoena power, can investigate multiple workers simultaneously, and prohibits retaliation.

Filing deadline. FLSA claims: 2 years (non-willful) or 3 years (willful). Tennessee state wage claims: generally 3 years under Tennessee’s general contract and tort statute of limitations.

Real Situations: Common Tennessee Wage Disputes

Auto parts supplier off-the-clock work. Tennessee’s automotive supply chain extends from large assembly plants to hundreds of smaller parts fabricators and suppliers. A common violation involves requiring hourly workers to be at their stations, logged into systems, and ready to work before their scheduled clock-in time — but denying pay for that setup time. Even 10 minutes per day over years of employment represents substantial back pay.

Healthcare worker misclassification in Nashville. Nashville’s large healthcare sector employs nurses, medical coders, and healthcare IT workers who are sometimes classified as independent contractors. Workers who follow the hospital’s protocols, use hospital equipment, and work established schedules are typically employees under the FLSA economic reality test — entitled to minimum wage, overtime, and employer tax contributions.

Restaurant workers in Memphis and Nashville. Tennessee’s restaurant industry generates significant tip credit and minimum wage claims. Employers who require tipped workers to spend more than 20% of their time on non-tipped “side work” (cleaning, food prep, setup) cannot apply the tip credit to that time — those hours must be paid at the full minimum wage. Many Tennessee restaurant employers apply the tip credit across the entire shift regardless of what duties were actually performed.

Common Mistakes Tennessee Workers Make

Relying on the state agency when the federal option is stronger. Tennessee workers sometimes file complaints with the state Department of Labor and wait months for results, when the federal Wage and Hour Division can investigate the same violation more aggressively and cover more workers simultaneously. For FLSA violations (minimum wage, overtime), the federal route is usually more effective.

Missing the FLSA deadline. Tennessee workers often wait before filing, not realizing the FLSA’s two-year limitation period is strictly enforced. Workers who delay beyond 24 months permanently lose wages for the period before the deadline window opens.

Not knowing that unauthorized payroll deductions are illegal. Tennessee employers frequently deduct from wages for uniforms, damaged equipment, or cash register shortages without written employee authorization. These deductions violate the Tennessee Wage Regulations Act. Workers whose take-home pay is routinely reduced by unexplained deductions should request an accounting of their payroll records.

How to File a Wage Claim in Tennessee

Option 1 — Department of Labor (FLSA) — primary option. File with the federal Wage and Hour Division at dol.gov/agencies/whd/contact. Free investigation, retaliation prohibited, 2–3 year statute of limitations. This is the most effective path for most Tennessee workers.

Option 2 — Tennessee Department of Labor and Workforce Development. File at tn.gov/workforce. More useful for unauthorized deduction claims and state-specific wage payment violations.

Option 3 — Civil lawsuit. Sue in Tennessee Circuit or Chancery Court for FLSA violations or breach of contract for unpaid wages. Recover unpaid wages plus equal liquidated damages and attorney fees under the FLSA. Tennessee small claims court handles claims up to $25,000 without a lawyer.

Statute of Limitations

Related Guides

• Employment Rights Guide — federal wage and overtime rules that are your primary protection in Tennessee
• Tennessee Small Claims Court — sue for unpaid wages up to $25,000 without a lawyer
• Tennessee Eviction Notice Requirements — tenant protections for Tennessee renters
• Tennessee Security Deposit Laws — your rights as a Tennessee renter
• Tennessee Tenant Rights Guide — complete tenant rights guide for Tennessee renters

This article is for informational purposes only and does not constitute legal advice. Always verify current rules at dol.gov or consult a licensed Tennessee employment attorney. Last reviewed: March 2026.