Alabama Labor Laws: A Complete Guide to Wages, Breaks, Overtime, and More (2024)

In this article, we’ll dive deep into Alabama’s labor laws, with details on all the important aspects of the state’s regulations on your employees.

Understanding and respecting the labor laws of your place of business is important, no matter where you do business. These laws are the basis and foundation of the employer-employee relationship, often serving to protect the rights of both parties. 

Alabama, as with many other U.S. states, protects its workers with laws designed to keep all work environments safe and compliant. In the Heart of Dixie, labor laws detail everything from wages to breaks, overtime, and more. 

Are you an Alabamian looking to understand their rights to a fair work environment? Or are you an employer trying to remain compliant with laws in Alabama to avoid hefty fines and lawsuits? This comprehensive guide on Alabama labor laws provides all the details you might need to know about lawful work practices in Alabama.

In this article, one of the 50-state series of labor law guides, we’ll provide practical guidance to help you understand the Yellowhammer State’s labor laws.

Meals and Breaks in Alabama

Meals and breaks are an essential part of any employee’s day. Many states require employers to provide employees with meal breaks, rest breaks, or a combination of the two. However, Alabama does not.

Alabama follows federal regulations, which do not specify the time or duration of breaks. However, when employers do offer short breaks of between 5 to 20 minutes, federal law considers the breaks as compensable work hours. These work hours would be included in the sum of hours worked during the workweek and considered in determining if overtime was worked.

While that directive is governed by the state, there is an exception for when Alabama has its own law. Under Alabama state law, employees between 14 and 15 years old are eligible for a 30-minute break if they have worked for more than 5 hours consecutively.

Leave and Paid Time Off (PTO) in Alabama

Leave policies provide employees in Alabama the opportunity to take time off from work to address personal needs. More importantly, it allows them to take a break without losing their job or worrying about the financial stress of missing their wages on those days they are not at work. 

Alabama offers two types of leaves – required leaves and non-required leaves.

Alabama Required Leaves

In Alabama, employers are not required to provide employees with vacation leave, either paid or unpaid. If an employer decides to provide vacation leave, it must comply with the terms of its established policy or employment contract. 

Alabamian laws on required leaves may overlap at the federal and state level. Additionally, the laws for private and public employees differ in some instances.

Some laws on required leave in Alabama include:

Public Holiday leaves for public employees

Alabama state offices must be closed on federal and state holidays. If a state office works on said holidays, employees are given compensatory leave. If employees cannot use their compensatory leave, they must be offered compensation at their customary rate.

Family and Medical Leave (FMLA)

FMLA is granted for the birth or care of a newborn, or for the employee or their family members who may need care during a serious illness or injury. The federal FMLA provides employees unpaid absence of up to 12 workweeks during one year. 

As such, all employers must grant their employees up to 12 weeks of unpaid leave for serious personal health conditions, childbirth, or ill family members who need care. 

However, to be eligible, an employee must:

Jury Leave

In some cases, employees may be summoned for jury duty during a legal proceeding. When this happens, Alabama requires employers to grant paid leave to full-time employees summoned for and participate in jury duty, provided the employee presents a summons. 

Voting Leave

When elections are ongoing, employers are required to provide employees who are registered to vote with up to one hour of unpaid leave to vote.

However, if polls open two hours before an employee’s shift or one hour after the shift ends, the employer doesn’t need to provide time off, or may specify the hours during which the employee may take the leave.

Military Leave

Both private and public employees are entitled to military leave without loss of pay, vacation, or sick leave when called to duty. While this rule covers private employees, the Alabama Supreme Court has previously ruled that requiring private employers to pay for military leave violated the state constitution.

Emergency Response Leave

Sometimes, employees may volunteer for emergency response. Employees who are certified Disaster Services Volunteers of the American Red Cross, or employees who volunteer as firefighters during a fire outbreak, are entitled to leave work (provided it doesn’t exceed 15 workdays in 12 months) without losing pay, overtime, vacation, or sick time. 

In this case, the employer might request notice of the need for leave before missing work from the employee. Afterward, the employer may require that the employee provide documentation confirming they were providing emergency services.

Alabama Non-Required Leave

There are several circumstances for which Alabama doesn’t require employers to provide leave. These include:

Sick Leave

Alabama doesn’t require employers to offer sick leave benefits, whether paid or unpaid. This is usually detailed as an agreement for employee benefits in the employment contract.

Vacation Leave

According to the Fair Labor Standards Act (FLSA), employers don’t need to pay for time not worked. This includes vacation leave, sick leave, or holidays. However, there is sometimes mutual agreement between both parties to determine vacation benefits. If and when promised, the employer must grant vacation, and conditions must comply with employment contracts.

Bereavement Leave

Alabama does not require employers to provide employees with bereavement leave in the case of the death of a family member, particularly a spouse. However, this doesn’t apply to persons subject to the provisions of the state Merit System, legislative personnel, officers, and Legislative Reference Service personnel, as they are typically offered up to three days of paid bereavement leave.

Holiday Leave (Private Employers)

No Alabama law requires employers to provide employees with holiday leave, whether paid or unpaid. In addition, employers don’t need to pay premium wage rates if employees work during holidays.

While Alabama doesn’t have state-specific requirements for paid or unpaid leave, employers may voluntarily provide these benefits to attract and retain talent. Employees should consult their employment contracts, company policies, or handbooks to understand their specific leave entitlements.

Regardless, employees and employers must be well informed about their rights and duties in maintaining or enjoying a fair work environment when respecting leave policies.

Overtime Regulations in Alabama

Sometimes, workers may be required to work overtime. Working outside their regular hours may be caused by short-staffing, peak hours, or a need to complete a big project.

When this happens, employers are required to pay their employees overtime rates. However, there is no state-specific law in Alabama that regulates overtime rates or pay. Instead, the federal Fair Labor Standards Act governs overtime pay.

Federal law requires the employer to pay 1.5 times the employee’s regular wage rate for any time exceeding 40 hours in seven consecutive days.

Certain employees are exempt from the overtime rule. These include:

Overtime Calculations and Payments

As mentioned above, overtime is typically calculated at one and a half times the regular rate of pay when work hours exceed 40 hours in 7 consecutive days.

In Alabama, overtime is required for non-exempt employees who work more than 40 hours in a workweek, and the workweek may be determined by the employer. 

To calculate overtime:

Regular rate = Total hours times the hourly rate, plus the workweek equivalent of the bonus and/or commission, divided by the total hours in the workweek; then pay half of that regular rate for each overtime hour.

Regular rate = Salary divided by the number of hours the salary is intended to compensate.

Overtime pay must be paid by the next regular payday following the workweek in which the overtime was earned.

Employers are also legally obligated to maintain accurate records of hours worked, overtime earned, and wages paid.

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Wages and Benefits in Alabama

Alabama has not established or adopted a state minimum wage law. As such, many employers adhere to federal laws dictated by the U.S. Department of Labor’s Wage and Hours Division.

  • Workers in Alabama are subject to the FLSA, and must be paid the federal minimum wage of $7.25 per hour. 

  • Tipped employees must receive a minimum tipped hourly wage of $2.13. If the tips plus the legal hourly wage is less than the federally approved minimum wage of $7.25, the employer must make up the difference.

  • An employer can take a tip credit from an employee of no more than $5.12 per hour.

  • Workers under 20 are eligible to receive a minimum wage of $4.25. This applies to their first 90 days of employment, after which they are entitled to the federal minimum wage of $7.25.
 In 2022, the average annual pay of employees in Alabama amounted to around $57,340 dollars

Pay Frequency, Pay Stubs, and Final Paychecks

  • Alabama does not have specific laws regarding pay frequency. Employers typically determine their own pay schedules.

  • Some standard pay frequency schedules an employer can use include weekly, where employees are paid once a week (52 paychecks per year), biweekly (26 paychecks per year), semi-monthly (24 paychecks per year), or monthly (12 paychecks per year).

  • Alabama law requires public service corporations engaged in transportation, doing business in and employing as many as 50 or more employees in Alabama, to make full payment to employees for services performed as often as once every two weeks, or twice during each calendar month. This payment includes all amounts due for labor or services performed, up to not less than 15 days prior to the time of payment.

  • Alabama does not have any state-specific rule regarding pay stubs. However, it is a good practice for employers to provide detailed pay stubs to employees, including information about earnings, deductions, and hours worked.

  • Alabama doesn’t have any state laws regarding final payments of wages. This means there are no state laws dictating when an employer must give their employee the final paycheck when they are terminated or have resigned. However, in many cases, this does not apply to sales representatives in the state. As such, an employer must pay out any commissions to their sales representative within 30 days after the employer is laid off or resigns. Any other concern is usually a mutual agreement between an employer and employee.

Mandatory and Optional Benefits

In Alabama, employees are eligible for certain benefits. While some of these benefits are mandatory, and employers are required by law to provide them, most are optional. 

Some examples of mandatory employee benefits in Alabama include:

  • Medical and family leave
  • Health insurance (for employers with more than 50 employees)
  • Social security 

However, many employers in Alabama offer a range of optional benefits to attract and retain employees. These can include health insurance, retirement plans, paid time off (sick leave and vacation), and other incentives. The availability and details of these benefits may vary from one employer to another.

Prevailing Wages in Alabama

Alabama does not have any state laws governing prevailing wages. However, if public funding is involved in the public works construction project, then certain federal laws apply. 

The Davis-Bacon Act and the McNamara-O’Hara Service Contract Act apply to construction and service contracts funded with federal dollars.

Under the Davis-Bacon Act, contractors and sub-contractors must pay their employees no less than the locally prevailing wages and fringe benefits for similar projects in the area. 

This ensures workers on publicly funded projects receive fair compensation, maintain a certain standard of living, and compete on a level playing field. 

Understanding prevailing wages, their implications, and their application in public works projects is essential for employers and employees engaged in the construction industry in Alabama. Since the Department of Labor in Alabama is responsible for defining and disseminating prevailing wage rates, employers can find the most up-to-date rates on the official website of the Alabama Department of Labor.

Click here to see Alabama’s most recent prevailing wage rates.

Hiring Practices In Alabama

While Alabama has no specific laws regarding job posting, the state requires fairness. Employers in Alabama typically adhere to federal guidelines, such as those outlined in the Civil Rights Act, the Americans with Disabilities Act, and the Fair Labor Standards Act (FLSA). 

These federal laws govern issues related to anti-discrimination, equal employment opportunities, minimum wage, overtime, and other essential employment aspects. This means that job postings, interviews, and even hiring decisions should be free of discriminatory terms or remarks.

For instance, under the Alabama Age Discrimination in Employment Act, discriminating against individuals aged 40 and older while hiring, compensating, training, licensing, and similar is unlawful. 

The law also extends to job applicants who have been charged with a misdemeanor criminal offense, a traffic violation, or a municipal ordinance violation have the right to “expunge records” — provided that the charge:

Alabama does not have state-specific laws regulating background checks for employment.

Employers in Alabama are generally allowed to conduct background checks on job applicants, including criminal background checks and credit checks, as long as they comply with federal laws, such as the Fair Credit Reporting Act (FCRA), and other relevant federal regulations. 

Alabama does not have specific state laws regulating drug testing in private employment. Employers in Alabama are generally allowed to conduct drug testing, subject to federal requirements. Employers must follow certain guidelines like obtaining written consent from job applicants and ensuring the confidentiality and accuracy of test results.

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Employer Reporting Requirements in Alabama

Employers in Alabama are subject to specific reporting requirements that ensure compliance with state labor laws and provide essential information to various state agencies.

Understanding and adhering to Alabama’s employer reporting requirements and recordkeeping obligations is essential to maintaining legal compliance. Noncompliance with reporting and recordkeeping requirements can lead to legal consequences and financial penalties.

Health and Safety Standards in Alabama

Providing a safe and healthy environment for employees is one of the many responsibilities of an employer in Alabama. In Alabama, workplace safety is primarily governed by federal regulations and agencies, and the state has an agency responsible for enforcing these standards.

  • There is no state law overseeing workplace safety in Alabama. Instead, workplace safety is governed by regulations established by the federal Occupational Safety and Health Administration (OSHA). It details the factors every employee, especially in the private sector, needs to provide to create a safe environment free from hazards that can cause death or serious physical harm.
  • OSHA regulations cover a wide range of safety concerns, including safe machinery operation, the use of protective equipment, hazardous materials handling, and more.
  • In addition, the law states that the authorities are allowed to enter any facility during regular working hours to inspect devices, machinery, work conditions, and more. This ensures the provision of a working environment free from any hazards.

Additionally, if an employee believes there has been a violation of safety in the workplace, they can send in a written notice to the authorities and request an inspection. This act protects employees who file a complaint from any disciplinary actions.

If an employer is guilty of violating any regulations from this act, they may be required to pay a civil penalty of up to $70,000 for each violation.

Child Labor Laws in Alabama

It is important to note that these regulations don’t apply to minors aged 16 and 17 who are part of work-study, cooperative education, or similar programs where employment is an integral part of the course of study, provided the program is registered by the Bureau of Apprenticeship and Training of the United States Department of Labor.

If employers violate the child labor laws in Alabama, they are liable for penalties ranging from $300 to $5,000, depending on the severity of the violation.

Employee Termination and Resignation in Alabama

  • Under Alabama law, employees can be laid off at any time and for any reason. This is known as the at-will doctrine. Additionally, employees cannot file a suit for this kind of employment termination.
  • Employees cannot fire employees due to discrimination. This is known as wrongful termination, for which the employer can be sued for compensation. 
  • Alabama doesn’t have state law dictating specific rules for final paychecks. As such, employers are not required by law to provide immediate settlement. There are generally no state-specific notice requirements for employee terminations. However, employers are encouraged to follow best practices, including providing advance notice or severance pay.
  • Employees are typically encouraged to provide advance notice when resigning, as it allows for a smoother transition. However, there are no specific legal requirements for resignation notice 
  • Alabama law does not require employers to provide severance pay to employees upon termination unless stipulated in an employment contract or company policy.
  • Alabama is a “right-to-work” state. This means employees are not required to join or financially support a union as a condition of employment.

Unemployment Benefits in Alabama

The Department of Labor handles unemployment benefits and determines eligibility on a case-by-case basis. 

To be considered eligible, applicants must meet the following three eligibility requirements:

Eligibility is determined based on wages earned in a “base period,” which is typically the first four of the last five completed calendar quarters.

If you are eligible for unemployment:

How To Apply For Unemployment Benefits

To apply for unemployment benefits in Alabama, individuals use the Alabama Department of Labor’s online portal, or may contacting the department by phone. The application typically requires the following information:

Employers in Alabama have responsibilities related to unemployment benefits, such as responding to claims for unemployment benefits when an employee files for them. 

Resources to understand unemployment in Alabama can be found on the Alabama Department of Labor website.

Penalties for Noncompliance in Alabama

The specific penalties and fines for noncompliance with Alabama labor laws vary with the nature of the violation.

For example:

Other Essential Information About Labor Laws in Alabama

Resources and Further Reading on Alabama Labor Laws

Some resources and contact information for further reading and assistance with Alabama labor laws include:

Parting Words on Alabama Labor Laws

Alabama labor laws are a vital framework that governs the relationship between employers and employees in the state, thereby creating a safe and healthy work environment. Understanding these laws is crucial for both employers and workers to ensure fair treatment, compliance with regulations, and harmony.

As the landscape of labor laws can change over time, it’s imperative for both employers and employees to stay informed about the latest updates and consult legal professionals or relevant state agencies for specific questions or concerns.

The labor laws of Alabama cover a wide range of topics related to employment, such as pay, breaks, overtime, child labor, workplace security, discrimination, and more. Although Alabama mainly complies with federal regulations, there are several peculiarities that make the state stand out, such as the state’s “right-to-work” status and state organizations like the Alabama Department of Labor.

For many businesses, the only real solution to compliance challenges is great software. The right business management software tends to come with built-in compliance and recordkeeping rules, regardless of your industry, how many employees you have, what they do, or how widely they’re dispersed across the state (or country).

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Workyard is built around the industry’s most accurate GPS tracking and geofencing technology, which ensures payroll accuracy across your workforce, no matter which job site you send them to or when you need them to work there. Workyard’s timesheet tracking system also comes with built-in federal and state overtime rules, as well as adjustable break rules you can customize at the employee level.

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