In November 2024, Alaskan voters passed Ballot Measure 1. The law takes effect July 1, 2025, and has three main provisions: (1) increasing the minimum wage now and into the future (which also impacts exempt salary levels), (2) mandating paid sick leave for most employees, and (3) prohibiting mandatory employer-sponsored meetings on political or religious matters.
Minimum Wage and Exempt Salary Increases
On July 1, 2025, Alaska will see the first iteration of a three-stage minimum wage increase, increasing the current minimum wage from $11.91 per hour to $13.00 per hour. The minimum wage will then increase by $1.00 to $14.00 per hour for 2026, and to $15.00 per hour the following year.
After 2027, the minimum wage will be adjusted annually for inflation, based on the CPI-U for the Anchorage area. Over the past decade, the Anchorage CPI-U inflation has typically ranged from 1-3 percent, however some years have been far higher, such as 2022 (referenced in support of Ballot Measure 1) where inflation exceeded 8 percent. Alaska’s minimum wage is expected to exceed $20 per hour by 2035, if not sooner.
Note, as the measure also requires the Alaska minimum wage to be at least $2.00 per hour higher than the federal minimum wage, if the federal minimum wage is increased, the Alaska minimum wage could increase more than currently expected.
The increasing minimum wage also affects salaried employees who are exempt from overtime requirements under Alaska Statute 23.10.055(b) (the “white collar” exemptions). The minimum salary for these workers will increase as follows:
- July 1, 2025 = $54,080 annually ($1,040 weekly)
- July 1, 2026 = $58,240 annually ($1,120 weekly)
- July 1, 2027 = $62,400 annually ($1,200 weekly)
Thereafter, the exempt salary requirements will also increase as a function of inflation, as they are based on the then-current minimum wage.
Employers should be aware of these stepped changes and anticipate compliance. Alaska’s minimum wage has been tied to inflation since 2014, again by ballot measure, so hopefully making these changes will not be difficult.
Paid Sick Leave
Ballot Measure 1 also requires employers to provide an additional paid benefit to employees in the form of paid sick leave, aligning the state with 18 others (including all west coast states) that have similar laws.
Accrual
Employees must accrue at least one hour of paid sick leave for every 30 hours worked, capped at 56 hours per year for employers with 15 or more in-state employees and 40 hours for employers with fewer than 15 employees. Exempt employees are presumed to work eight (8) hours a day / 40-hour workweek for purposes of accruing and using paid sick leave, unless an alternative schedule is established.
Note that while accrual is capped, an employee’s sick leave balance can exceed 56 or 40 hours, as the law does not designate a balance or carry-over cap. The law requires employers to provide notice to new employees, either at the time they are hired or before August 1, 2025, of the terms of the new paid sick leave law. While the law does not currently specifically include a requirement that the employer provide ongoing accrual and balance figures to employees, upcoming rulemaking will likely clarify and implement such a requirement.
Usage
Employers can limit annual usage of paid sick leave at the same levels as the applicable accrual cap. But while accrual and usage can be capped, there is no cap on an employee’s sick leave balance.
Leave can be used for an employee’s or family member’s illness, medical care, or issues related to domestic violence, sexual assault, or stalking. Employees can use paid sick leave in increments of one hour, or the “smallest increment that the employer’s payroll system uses to account for absences or use of other time.”
Separation/Reinstatement
There is no payout requirement of any accrued, unused sick leave upon termination. An employee who is terminated for any reason but rehired within six months by the same employer must have their balance reinstated.
Notice/Documentation
Employees who can anticipate a need for use of sick leave are required to make a good faith effort to provide notice to their employer in advance of the use of sick leave, and make a reasonable effort to schedule the leave so as not to disrupt the workplace. Employers can require proof of illness for leave of four or more consecutive workdays.
Exceptions
Certain employees are exempted from the law, such as minors working under 30 hours per week, apprentices, and employees under collective bargaining agreements that explicitly waive sick leave rights.
Using PTO to Comply
Employers can use Paid Time Off (PTO) to comply with the new requirements, making the leave available for non-sick reasons as well, providing the policy meets all the requirements of the paid sick leave law. Employers with existing PTO policies should review those policies to ensure they meet the minimums and limits.
Employers with PTO policies that span several states should pay careful attention here, as Alaska’s accrual rates and caps differ from those in other states—a PTO policy that works in Washington may not work in Alaska.
Prohibition on Certain Mandatory Meetings
The final notable provision in Ballot Measure 1 bans employers from mandating attendance at meetings or exposure to communications that are primarily about political or religious matters, defined as opinions on legislation, elections, unionization, or religious practices. This aligns with recent National Labor Relations Board (NLRB) decisions banning “captive-audience meetings,” where an employer requires workers to attend a presentation on the drawbacks or downsides of unionization, usually in response to an effort to organize the workplace.
Employers following changes in labor law will be familiar with this drastic change in precedent under the prior Biden administration, which has given rise to nearly a dozen states enacting laws that echo this drastic change in NLRB precedent. Prior to the NLRB decision in 2024, captive-audience meetings have been permitted under the prior 70 years of precedent, including that of the U.S. Supreme Court. In the past two years, eleven states, including California, Oregon, Washington, and Hawaii, have enacted similar state-level bans. Only Oregon’s law has been in place for longer, since 2010, and was challenged on constitutional grounds several times. Those challenges were dismissed on procedural grounds, and therefore it remains an open question whether such laws are constitutionally permissible, particularly in light of SCOTUS precedent that appears contradictory. Notably, before the election, the State of Alaska Attorney General noted issues of constitutionality and issued an opinion that this prohibition “raises constitutional concerns.”
Regardless, employers should be prepared to comply on July 1, 2025. Compliance, however, is not always straightforward. The law’s broad definitions may make compliance difficult to pin down: voluntary meetings or workplace discussions could be misconstrued as coercive, and mandatory meetings necessary to the functioning of the workplace can often deviate into impermissible topics. Employees who choose to skip voluntary meetings may likewise claim some form of retaliation, implicit or otherwise. Employers, particularly those non-unionized employers unfamiliar with these rules, must train managers to avoid mandating attendance or linking job consequences to participation.
Finally, the law is vague regarding the enforcement and penalties associated with this specific section. Ballot Measure 1 simply provides that employees may recover for lost wages “resulting from the employee’s decision not to participate or any adverse action taken as a result” (e.g., retaliation damages), but is silent on penalties or a private right of action. Should employees have a private right of action for violations, employers may face collective or class actions for violations that can be construed as affecting a large number of employees. Clarification is expected from the State, and we will provide updates as this develops further.
Key Takeaways for Alaska Employers
- Alaska employers should audit their current pay levels, and for any employee who is not paid at least the applicable minimum wage or exempt salary level, be prepared to increase the pay of those employees effective July 1, 2025.
- Alaska employers should also create or revise current paid sick leave / PTO plans that comply with the new paid sick leave requirements, beginning July 1, 2025.
- Finally, Alaska employers should train managers and supervisors on the requirements and limitations on “captive audience” meetings.
The legal issues impacting this topic are and will continue to be ever-changing (Employment Law in Motion!), and since publication of this blog post, new or additional information not referenced in this blog post may be available.
This article is provided for informational purposes only—it does not constitute legal advice and does not create an attorney-client relationship between the firm and the reader. Readers should consult legal counsel before taking action relating to the subject matter of this article.
