Final Rule Requires $15 Minimum Wage for Federal Contracts
WASHINGTON—November 24, 2022—Beginning January 30, 2022 the hourly minimum wage for all employees working on federal contracts is $15 due to the final rule announced by the United States Department of Labor. The final rule implements Executive Order 14206, which President Biden signed on April 27.
“In addition to promoting efficiency in federal contracting, the implementation of Executive Order 14026 has other benefits,” said Wage and Hour Division Acting Administrator Jessica Looman. “The final rule adds value for taxpayers by boosting worker productivity and reducing employee turnover and absenteeism. It also allows federal contractors to retain top talent, and reduce recruiting and training costs.”
All U.S. states, specified territories, and the District of Columbia are subject to the rule, which affects most new contracts, renewals, and extensions of existing contracts. The Order goes beyond the wage increase; below is a summary of requirements:
Increases the hourly minimum wage for workers performing work on or in connection with covered federal contracts to $15 beginning Jan. 30, 2022.
Continues to index the federal contract minimum wage in future years to inflation.
Ensures a $15 minimum wage for workers with disabilities performing work on or in connection with covered contracts.
Eliminates the tipped minimum wage for federal contract employees by 2024.
Restores minimum wage protections to outfitters and guides operating on federal lands.
“The workers helped by Executive Order 14026 and today’s final rule do essential work on our nation’s behalf. They build and repair the federal infrastructure,” said U.S. Secretary of Labor Marty Walsh. “Implementing this Executive Order improves the economic security of these workers and their families.”
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