Industry groups oppose Alaska minimum wage ballot initiative, but say no campaign spending is planned

Several groups representing Alaska businesses are opposed to a ballot initiative that would increase the state’s minimum wage and guarantee Alaska workers paid sick leave, though no money has so far been spent campaigning against the measure.

The group supporting the ballot initiative, which will appear before voters in November, has already reported raising more than $2.5 million to fund its campaign. Meanwhile, Alaska Chamber of Commerce President Kati Capozzi said the opponents of the measure did not expect to form a group that would spend money actively campaigning against it.

The initiative would raise Alaska’s minimum wage from $11.73 to $15 by 2027 and guarantee Alaska workers paid sick leave for the first time. Groups opposing the measure include the Alaska Chamber of Commerce, the Alaska Travel Industry Association, the Alaska Support Industry Alliance, Alaska Association of Contractors, Alaska Builders and Constructors, and the Alaska chapter of the National Federation of Independent Businesses.

Joelle Hall, president of the AFL-CIO, the state’s largest labor organization, is one of the co-chairs of the campaign advocating for the minimum wage increase and the paid sick leave guarantee, along with a new provision that would prohibit employers from forcing employees to attend meetings regarding political or religious matters. The question will appear before voters in November.

Hall said the lack of campaign spending from the opposing side is due to the popularity of the initiative. Polling conducted in May by the “yes” campaign found that 64% of likely Alaska voters supported the measure.

“I have to assume that that’s because there’s a lot of people who don’t want their brand or their name associated with saying sick people should go to work. Because that’s what you’re saying by spending money against it,” said Hall.

Capozzi said the Chamber is not spending money mounting an organized opposition campaign because “small businesses are busy running their businesses — they don’t have a lot of extra money to toss into this.”

In a public hearing held Monday, Capozzi called the initiative “a wolf in sheep’s clothing,” pointing specifically to the paid sick leave provisions it includes.

“The minimum wage is not at all a concern of the Alaska Chamber. It’s more of the paid sick leave,” said Capozzi, adding that most Chamber members already offer paid sick leave — but are wary of additional requirements from the state. “So it’s not so much that it’s requiring paid sick leave. It’s the broadness and the vagueness of the actual language that leads to a lot of confusion, a lot of concern that this will end up in court.”

According to data collected by the campaign advocating in favor of the ballot measure, a quarter of Alaska workers do not currently have access to paid sick leave. The polling done by the campaign found three-quarters of Alaska voters support requiring private employers to provide paid sick leave.

Hall said workers who do not currently have access to paid leave include some in the food industry and home health care workers, among others.

Under the initiative, private employers must provide workers with one hour of paid sick leave for every 30 hours worked. Employers with 15 or more employees must grant 56 hours of paid sick leave per year, or more if sanctioned by the employer.

Employers with fewer than 15 employees would be required to grant 40 hours of paid sick leave per year.

Rebecca Logan, chief executive of the Alaska Support Industry Alliance, which represents companies supporting the oil and gas industry, said the increase in minimum wage would not affect the industry, but the sick leave policy would be “messing with their current HR and employee plans” for companies represented by the Alliance.

Logan said for companies that don’t currently provide any sick leave, a requirement to offer leave would be “a significant increase in your cost of doing business.” Smaller companies with fewer than 15 employees would also struggle to find replacement workers if someone takes a sick day, she added. Logan also noted that on the North Slope, where workers often have two-week-on, two-week-off schedules, the impacts of the policy would be unclear.

Capozzi also said the policy could create challenges for businesses in the tourism industry, which operate only a limited number of weeks per year.

Over 100 small business owners in Alaska have publicly expressed their support for the initiative, including some in the tourism industry.

Capozzi said the Chamber is concerned because the initiative allows sick leave to be used by an employee to care for a family member “or any other individual related by blood or whose close association is the equivalent of a family relationship.”

Hall said that shouldn’t cause concern because ultimately, workers are only guaranteed up to 56 hours of leave under the initiative, meaning the potential for abusing the policy is limited.

“This is a precious resource. You only get so many of these days of a year. I would be very judicious about how I use my sick time, because I don’t know if I’m going to need it,” said Hall.

Capozzi and Logan said they would be working to educate their members on the potential impacts of the initiative, even without mounting a full campaign.

“I don’t think it’s fair to say there aren’t campaigns. There are campaigns with commercials that people run — and then there are educational campaigns where our responsibility is to the 500 companies that we represent, and their 35,000 employees, to say, ‘Here’s how this legislation can impact you,’” said Logan.

Alaska would not be the first to adopt a statewide sick leave policy. Fifteen states, in addition to numerous cities and counties across the country, have already adopted laws mandating paid sick leave for most workers, according to A Better Balance, a nonprofit tracking the issue.

The campaign in favor of the ballot measure is funded primarily by national groups based outside of Alaska. The group’s top funders include the Sixteen Thirty Fund and the Fairness Project — both based in Washington, D.C. — and Unite Here, based in New York City.

The Fairness Project is a union-based organization that for several years has worked to pass progressive ballot initiatives across the country, including ones related to mandatory sick leave and minimum wage hikes. This year, the national organization is working on paid sick leave ballot measures in Nebraska and Missouri, in addition to Alaska. It is also working on ballot measures to protect abortion access in Arizona, Florida, Missouri and Montana.

[Correction: The story has been updated to reflect that the campaign supporting the ballot initiative has raised more than $2.5 million, not $1.3 million as previously reported.]