Alaska Labor Law Updates 2025
Kort Redick, CPA
Changes to Payroll Effective July 1, 2025
With the passage of Alaska’s 2024 Ballot Measure 1, significant updates are coming to the way employers must compensate and provide benefits to their employees. Here’s what you need to know, and how we’re proactively adjusting your payroll services to ensure you meet these new requirements.
What Is Ballot Measure 1?
Ballot Measure 1, approved by Alaska voters in 2024, enacts two major changes for employers statewide:
Increase in the Minimum Wage: The measure raises Alaska’s minimum wage to $13, setting a new baseline for hourly compensation for most employees.
Mandatory Paid Sick Leave: For the first time, employers are required to provide paid sick leave to their employees. In general, employees will be entitled to one hour of paid sick leave for every thirty hours of work.
How Does This Affect Your Business?
1. Minimum Wage Increase
All employees must be paid at least the new minimum wage, regardless of whether they are full-time, part-time, or seasonal. This will be $13 on July 1, 2025, increasing to $14 on July 1, 2026 and $15 on July 1, 2027.
The new minimum wage applies to all hours worked, including overtime calculations.
Employers must review and, if necessary, adjust wage rates for any employees currently earning less than the new minimum.
2. Paid Sick Leave Requirements
Employees will accrue paid sick leave based on hours worked, up to a minimum standard set by the new law.
Accrued sick leave can be used for personal illness, caring for a sick family member, or other qualifying reasons.
Employers must track accrual and usage, and provide employees with regular updates on their available sick leave balance.
Our Commitment: Seamless Compliance for Your Payroll
As your payroll processor, we are already taking steps to ensure your business is fully compliant with Ballot Measure 1:
Automatic Wage Adjustments: We will update your payroll system to reflect the new minimum wage for all affected employees, effective as of the law’s implementation dates.
Sick Leave Accrual Tracking: Our system will begin accruing paid sick leave for all eligible employees, in accordance with the new legal requirements. Accrual rates and maximums will be clearly displayed on employee pay stubs.
Reporting and Recordkeeping: We will provide you with detailed reports on wage adjustments and sick leave accruals, making it easy to demonstrate compliance in the event of an audit or employee inquiry.
Employee Communication: We will generate updated pay statements and notifications so your employees are aware of their new wage rates and sick leave balances.
What You Need to Do
Review your current wage rates and identify any employees who will need an increase to meet the new minimum.
Update your employee handbook and policies to reflect the new paid sick leave requirements.
Contact us if you have any questions about how these changes affect your business or if you need assistance with employee communications.
Looking Ahead
We understand that changes in employment law can be challenging, but our goal is to make this transition as smooth as possible for you and your team. By staying ahead of these requirements, you can focus on running your business with confidence, knowing your payroll and employee benefits are fully compliant.
If you have any questions or need further guidance, please don’t hesitate to reach out to our team. We’re here to help you navigate these changes every step of the way.
Further Reading:
Text of the law: https://www.elections.alaska.gov/doc/oep/2024/Ballot%20Measure%201_Eng.pdf
Alaska Department of Labor FAQ: https://labor.alaska.gov/lss/ballot-1-faq-2025.html