Alaska’s minimum wage will increase to $9.80 per hour

Employees in Alaska will see the state minimum wage increase to $9.80 per hour on January 1, 2017, according to the Department of Labor and Workforce Development.

Under the Alaska Wage and Hour Act, the minimum wage must be adjusted annually for inflation, based on the Consumer Price Index for all urban consumers for the Anchorage metropolitan area (CPI-U) for the proceeding January-December calendar year. The CPI increased 0.5 percent in 2015, rising from 215.805 to 216.909, and, as a result, the Alaska State minimum wage will rise from $9.75 to $9.80 effective January 1, 2017.

The minimum wage increase applies to all employees in the private sector, whether working in a for-profit, not-for-profit or non-profit business. Tips still do not count toward the minimum wage. Public school bus driver wages must be compensated not less than twice the current Alaska minimum wage.

Alaska law requires an individual employed in a bona fide executive, administrative, or professional capacity to be compensated on a salary or fee basis at a rate of not less than two times the state minimum wage for the first 40 hours of employment each week, exclusive of board or lodging that is furnished by the individual’s employer. However, this minimum salary requirement for exemption has recently been increased to $913 per week effective December 1, 2016. This exemption mirrors the federal requirements, which are amended as part of final overtime rule changes adopted earlier this year by the United States Department of Labor, doubling the salary threshold from $23,660 to $47,476 per year, or from $455 to $913 per week, effective December 1, 2016. (State of Alaska, Department of Labor and Workforce Development, Division of Labor Standards and Safety, Wage and Hour Administration, Notice of Alaska Minimum Wage Effective January 1, 2017, October 25, 2016, http://labor.alaska.gov/lss/whhome.htm; State of Alaska, Department of Labor and Workforce Development, Administrative Services Division, Research and Analysis, 2017 Minimum Wage Determination, October 21, 2016, http://labor.alaska.gov/lss/forms/2017-minimum-wage-determination.pdf).

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