Compliance Watch:

What are my rights as an hourly employee in Alaska?

An hourly employee is one who is paid on the basis of the number of hours that they have worked. Hourly employees are typically eligible to receive compensation for working overtime hours, unlike salaried employees.

Given that employers typically determine the working hours of their hourly employees, it results in a fluctuation in both their working hours and income on a bi-weekly basis. In contrast, salaried employees receive consistent pay, irrespective of the hours worked, due to the fixed nature of their compensation. 

In addition to having a fluctuating income, hourly workers may also have fewer employment benefits secured as well as having lower chances of advancing their career, unlike salaried employees.

Now that we have taken a brief look at the definition of hourly employment, let us now examine the differences between the several work aspects of hourly employees and salaried employees as exemplified in the table below.

To learn more about Alaska labor laws, you can access our informative guides on understanding your rights as a salaried employee in Alaska and discovering how to run payroll in Alaska.

In the state of Alaska, both state law and federal law do not impose any limitations on the number of hours an employee is allowed to work in a week. Hence, according to the federal Fair Labor Standards Act (FLSA), employees over the age of 16 are allowed to work as many hours as they deem appropriate in a given work week.

However, while both federal overtime laws and state law remain silent on the required weekly hours an employee is eligible to work, both laws stipulate that Alaska workers must be compensated at a rate of one and a half times their regular hourly wage if they have worked more than 40 hours in a given work week. Hence, Alaska employers must comply with the law that offers the most benefits to the employees. Although, employers in Alaska must remember that employees working in certain professions are exempt from earning overtime pay under both state and federal regulations.

The wage and work hour requirements in employment are legally dictated by both the federal Fair Labour Standards Act (FLSA) and the Alaska Wage and Hour Act. As of January 1, 2024, the current minimum wage in the state of Alaska is set at $11.73, which is $4.48 higher than the federal minimum wage of $7.25. Hence, the state’s minimum wage requirements prevail over the federally mandated minimum wage as it provides more benefits to the employees. Additionally, Alaska’s minimum wage is set to incrementally increase on an annual basis over the next few years due to the rise of inflation. Therefore, Alaska’s hourly employees are expected to earn a minimum weekly wage of $480 in any given 40-hour work week.

Minimum wage laws are implemented to ensure that employees are protected from work exploitation by ensuring that they are fairly compensated in return for the work that they have performed. In addition, setting a minimum standard for wages removes income inequality and provides employees with some level of financial security to be able to afford the basic necessities and provide for their families. This not only consequently improves their quality of life and overall well-being, but also stimulates economic growth by increasing the spending power of employees.

In the state of Alaska, employees working in specific occupations are exempt by both federal and state law from earning the state’s minimum wage. The common exemptions are as follows:

• Employees under the age of 20
• Tipped employees
• Babysitters who work on a casual basis
• Outside salespeople
• Newspaper delivery men
• Employees working in agriculture
• Administrative, executive, or professional employees
• Employees who are computer professionals

Under both state law and federal law, overtime hours are categorized as any additional hours worked beyond the regular 40-hour work week which must be compensated by employers at a standard rate of one and a half times the employee’s regular pay rate. Hence, hourly employees in Alaska are entitled to receive $17.59 for every hour worked overtime.

Employees engaged in particular occupations are also exempt from receiving Alaska’s mandated overtime wage. Below is a list of employees, in addition to the employees who are exempt from receiving the state’s minimum, who are also exempt from receiving the state’s overtime pay. These employees comprise of:

• Employees hired by employers with less than 4 employees.
• Seamen
• Specific workers who provide emergency medical service.
• Employees engaged in forestry or lumber operation work employed by an establishment with 12 or fewer employees.

Studies have shown that rest and meal breaks make employees feel more productive and increase their level of job satisfaction in the workplace and it is no wonder why this is so. Periodic work breaks not only alleviate stress and fatigue that are likely to arise from working long hours, but they also help to foster a healthier working environment which plays a critical role in the satisfaction of of employees.

 While work breaks abound with plenty of physical and mental benefits for an employee, in the state of Alaska, rest and meal breaks for employees above the age of 18 are not mandatory according to both state and federal law. Nevertheless, if an employer decides to extend work breaks to their employees, both Alaska’s statutes and federal law have established legal guidelines regarding compensation for work breaks. According to the laws at both state and federal levels, employers are mandated to provide compensation to their employees for rest breaks that last for 20 minutes or less. However, meal breaks with a duration of more than 20 minutes may remain unpaid.

However, an exception arises for minors. Federal and state law entitles employees aged 14 to 17 to a work break with a duration of 30 minutes if they have worked for 5 or more consecutive hours. This break must take place after the first one and a half hours of work but before the commencement of the last hour of work for the day.

In addition, lactating mothers in Alaska are entitled to ‘breastfeeding’ breaks. While state law does not mandate employers to provide nursing mothers with breaks to express milk, federal law guidelines have established that nursing mothers are allowed periodic work breaks to express milk in a private non-bathroom area that is free from public intrusion for up to one year after childbirth. Because federal law grants employment benefits in this matter, federal regulations take precedence, and nursing mothers have a legal right to ‘breastfeeding breaks’.

Taking time off from work is a crucial factor in striking a healthy work-life as this gives employees the opportunity to attend to important family and personal commitments in their lives. This, in turn, helps to decrease employees’ stress levels and boost their job satisfaction as well as their work productivity. As employees have diverse needs, many U.S. states have implemented various types of leaves to accommodate the individual needs of employees. In Alaska, there are several primary laws that govern time off and leaves for hourly employees. These are as follows:

1. Voting leave: Section 15.56.100 of the Alaska Statutes provides employees with paid time off to participate in election voting unless there are two hours between the opening of the polls and the start of the employee’s shift or two hours between the end of the employee’s scheduled shift and the closing of the polls.
2. Jury duty leave: Under section 15.56.100 of the Alaska Statutes, employers are not required to compensate for the leave that they provide to their employees who serve their jury duty. Furthermore, employers must not retaliate against their employees for serving their jury duty.
3. Donor leave: Under section 39.20.275 of the Alaska Statutes, state employees, who work at least 30 hours a week, are provided with a minimum of 40 hours and a maximum of 80 hours of compensated leave for screening, organ donation, and bone marrow donation purposes.
4. The Family and Medical Leave: The Family and Medical Leave Act is a federal law that governs family and medical leave for employees in Alaska. This Act provides eligible employees with 12 weeks of unpaid leave a year for particular family and medical reasons such as the birth or adoption of a child, a serious medical condition that affects the employee or their immediate family member, or specific military-related events. Employees can only utilize this leave if:
   • They were employed by the same employer for at least 12 months before utilizing their leave.
   • They must have worked a minimum of 1,250 hours during a 12-month duration of employment under the same employer. 
   • Their employer has 50 or more employees within a 75-mile radius.

The rationale behind the implementation of pay deduction laws in the United States is to ensure that employees are fairly and lawfully treated in terms of wages. These laws safeguard employees from unapproved or excessive deductions, promoting financial stability and preventing exploitive practices. Furthermore, adherence to pay deduction regulations helps to build trust in employer-employee relationships and compliance with labor standards. Let us now observe how pay deductions are regulated in Alaska.

The statutes of Alaska have established legal guidelines in relation to allowable wage deductions that can be made by an employer. The statutory provisions state that an employer is only permitted to deduct a portion of an employee’s wage if:

• They were empowered to do so by federal or state laws.
• They have sought the employee’s prior written authorization (such as for benefits, contributions, and transportation costs).

Notably, the statutory provisions prohibit wage deductions that reduce the employee’s wage rate below the statutory minimum wage or overtime rates, or if it would require reimbursement to the employer for any of the following circumstances:

1. Customer checks returned due to insufficient funds or any other reason;
2. Non-payment for goods or services as a result of theft or credit default;
3. Cash or cash register shortages unless the employee admits, willingly and in writing, to having personally taken the specific amount of cash that is alleged to be missing;
4. Lost, missing, or stolen property, unless the employee admits willingly and in writing, to having personally taken the specific property alleged to be lost, missing, or stolen; or
5. Damage or breakage costs unless clearly due to willful conduct of the employee and the employee has acknowledged responsibility in writing.

Furthermore, state law entitles employees to receive a written or electronic statement accurately outlining pay deductions for each pay period in which the deductions occurred. Hence, employers must be vigilant with their deductions as noncompliance with this requirement will result in penalties.

Job entitlements ensure that employees are Below is a list of some of the many employment entitlements that hourly employees in Alaska enjoy:

• Minimum wage: Alaska law legally mandates hourly employees to be paid the state’s minimum wage of $11.73 for every hour of work.
• Overtime: Hourly employees in the state of Alaska are legally entitled to overtime compensation for working any additional hours exceeding the 40-hour work week. This overtime payment must be paid at a fixed hourly rate of one and a half times the employee’s regular hourly wage.
• Worker’s compensation benefits: Nearly all employees in Alaska, including hourly ones, are covered under a workers’ compensation insurance policy. This type of insurance compensates employees who are unable to work due to sustaining work-related injuries by covering their medical costs.
• Short-term and long-term disability benefits: In the state of Alaska, employees are entitled to both short-term and long-term disability benefits, which protects an employee’s employment position in the event of disability. Benefits begin once the employee has been disabled from work and last up to 180 days from the date of disability.
• Unemployment insurance benefits: In the event of an employee losing their job through no fault of their own, Alaska typically provides its employees with unemployment insurance benefits to aid them financially during unemployment.

To safeguard the rights of employees from being mistreated and taken advantage of during the tenure of their employment, many U.S. states have enacted unique laws of their own to deter employers from engaging in unethical and discriminatory workplace practices. Below is a list of workplace protections that are given to hourly employees in Alaska.

1. Right to refuse lie detector tests: Section 23.10.037 of the Alaska Statutes protects employees from participating in lie detector tests as a condition of employment or continuation of employment. It also mandates employers to be fined or imprisoned if they have been found guilty of violating such provisions.
2. Workplace safety: As established in sections 18.60.010 to 18.60.105 of the Alaska Statutes, employees are legally required to be protected by their employers from recognized health hazards that may likely cause death or serious harm within the workplace. Employees are also given the legal entitlement to file a complaint if they believe the conditions of their workplace violate health and safety standards.
3. Child labor protection: Employees who are below the age of 18 are protected in the scope of employment. Section 23.10.325 to 23.10.370 of the Alaska Statutes sets out specific requirements in its provisions that employers must follow. These laws protect minors by restricting both their work hours and the particular occupations they are allowed to work in, ensuring their safety and well-being in the workplace.
4. Workplace discrimination: Under the Alaska Human Rights Act (AHRA), Alaska employees are legally protected by their employers from discrimination in the scope of employment based on their protected characteristics which comprise race, color, sex, national origin, religion, age, mental disability, physical disability, marital status, change in marital status, pregnancy, parenthood.

Alaska is one of the many states in the U.S. that have adopted the ‘employment-at-will’ doctrine to define the general nature of employment relationships. That is to say, both the employer and employee are legally entitled to terminate the employment relationship at any given time, with or without providing any reason for doing so. However, there are particular circumstances that legally restrict an employer’s ability to terminate their employees according to their own free will in order to protect employees from being taken advantage of in the employment relationship. These exceptions involve:

1. Breach of employment contract: If the employment relationship is regulated by an employment contract that is either written, oral, or implied in nature, the employer must disclose their reasons for termination and the employee is entitled to sue their employer for breaching the respective terms of the contract. This rule is also applicable to union collective bargaining agreements.
2. Retaliation: Employers are forbidden from terminating their employees who decide to assert their legal rights such as reporting legal or ethical workplace violations or refusing to commit a crime on behalf of their employer.
3. Public policy: Employees cannot be terminated on the basis of their refusal to participate in an illegal activity. This includes refusing to lie, steal, or commit a crime for their employer as doing so would contravene the established public policies of Alaska.
4. Workplace discrimination: The Alaska Human Rights Act (AHRA) serves to protect employees from being discriminated against by their employer on the basis of acquiring legally protected characteristics which include race, color, sex, national origin, religion, age, mental disability, physical disability, marital status, change in marital status, pregnancy, parenthood.

In addition, employees who have been laid off must be issued their final paycheck within 3 working days. For employees who voluntarily resign, their final paychecks must be given by the next regular pay date, at least three days after the employer has received notice of the employee’s termination of employment.

By definition, severance pay is the payment given to employees upon the termination of their employment which is typically calculated based on the employee’s length of service at the company. It is customarily given by employers as a gesture of goodwill and provides financial leverage for employees during times of unemployment. In Alaska, there are no state labor laws that mandate employers to offer severance pay to their employees once their employment has been terminated. Hence, severance pay is offered only if it is outlined in an employment contract or collective bargaining agreement, whereby employers are legally bound to adhere to the respective terms of the contract when making a severance payment.