New federal rule raises pay for many working overtime

By The Cordova Times staff

A new overtime rule finalized by the U.S. Department of Labor is expected to benefit several thousand Alaskans, state Labor Commissioner Heidi Drygas said May 18.

That rule increases the minimum salary requirements for employees to be considered overtime exempt and also limits an employer’s ability to classify lower paid workers as overtime exempt.

The rule will affect some 5,560 qualifying Alaskans currently treated as overtime exempt who receive a salary of less than $47,476 annually.

This includes employees working under administrative, executive, professional and other “white collar” overtime exemptions.

“Alaska’s middle class will be strengthened by this regulatory reform” Drygas said.

“The minimum salary requirements for overtime have not been updated for more than a decade. This adjustment means lower paid workers should earn additional compensation when they are required to work overtime.”

Alaska’s labor laws have exceeded federal standards since the Legislature passed the Wage and Hour Act in 1959.

The state’s minimum wage is higher than the federal minimum wage, and overtime coverage is more comprehensive.

Under Alaska’s overtime law, employees receive overtime when they work more than eight hours a day or when they work more than 40 hours in a week, while federal overtime threshold only kicks in after 40 hours worked in a week.

So as a result of this update, most workers earning less than $47,476 annually will be paid for overtime work, state labor officials said.