What should businesses do before hiring their first employee?

Hiring Your First Employee in Alaska: Essential Steps

Before hiring your first employee in Alaska, it is important to prepare your business to meet state and federal requirements. Proper preparation ensures compliance and smooth operational setup.

Register Your Business for Employment

• Obtain an Employer Identification Number (EIN): Apply for an EIN from the IRS. This number is required for payroll tax reporting and other employment-related filings.
• Register with Alaska Department of Labor and Workforce Development: Register your business for unemployment insurance and workers’ compensation coverage.

Understand and Plan for Payroll and Taxes

• Set up payroll systems: Choose a payroll system or service that supports Alaska state tax withholding and federal tax compliance.
• Familiarize with tax obligations: You must withhold federal income tax, Social Security, Medicare, and Alaska state unemployment insurance taxes.

Comply with Hiring and Employment Regulations

• Verify employee eligibility: Complete Form I-9 to confirm the legal right to work in the U.S.
• Classify workers correctly: Determine if the worker is an employee or an independent contractor to avoid misclassification issues.
• Understand Alaska labor laws: Review minimum wage, overtime, and workplace safety requirements specific to Alaska.

Prepare for Recordkeeping and Reporting

• Maintain accurate employee records: Keep documentation of hiring, tax forms, hours worked, and payroll for compliance and audits.
• Report new hires: Submit new hire reports to the Alaska New Hire Reporting Program promptly after hiring.

Consider Insurance and Benefits

• Obtain workers’ compensation insurance: Required for most Alaska employers to cover workplace injuries.
• Plan employee benefits: Decide on health insurance, retirement plans, and other benefits to attract and retain employees.

As of 2026, following these steps will help your Alaska business establish a compliant and efficient hiring process for your first employee.