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ICYMI: Biden Raises Minimum Wage for Federal Contractors to $15 an Hour

The White House Logo FOR IMMEDIATE RELEASE November 24, 2021 ICYMI: President Biden Raises Minimum Wage for Federal Contractors to $15 an Hour This week, the Department of Labor announced their final rule that will raise the hourly minimum wage to $15 an hour for employees on federal contracts beginning on January 30, 2022. This new rule from the Department of Labor follows through on President Biden's Executive Order (https://www.whitehouse.gov/briefing-room/presidential-actions/2021/04/27/executive-order-on-increasing-the-minimum-wage-for-federal-contractors/) from April. Raising the minimum wage will not only benefit workers and their families, it will also promote efficiency in federal contracting, reduce turnover, and provide higher values for taxpayers by boosting worker productivity. See excerpts from coverage below: Huntington Post: Joe Biden sets $15 minimum wage for federal contractors (https://www.huffpost.com/entry/biden-15-dollar-minimum-wage-federal-contractors_n_619bc744e4b044a1cc0aed75) [By Dave Jameson, 11/22/21] President Joe Bidens administration says hundreds of thousands of workers could see bigger paychecks starting next year due to its new minimum wage for federal contractors. The Labor Department said Monday that it had finalized a regulation that sets a $15 wage floor for workers under federal contracts. Firms providing services to the U.S. government will have to pay workers at least that much under contracts implemented or renewed starting Jan. 30, 2022.The federal government already sets contractor minimums through prevailing wage law (https://www.dol.gov/agencies/whd/government-contracts/service-contracts) . But Jessica Looman, acting administrator for the Labor Departments Wage and Hour Division, said on a press call Monday that there are 327,000 workers under federal contracts who are currently entitled to less than $15 per hour. Officials expect many of those workers to get raises as a result of the new regulation. Looman said restaurant workers, child care workers and maintenance workers are some of the most likely to see pay boosts. [...] After the initial bump to $15, the wage rate will be tied to an inflation index so that it increases with the cost of living, requiring firms to adjust their minimums each year. The rule will also eliminate the tipped minimum wage by 2024, requiring firms to pay the full minimum wage, not counting gratuities, at restaurants and other businesses under federal contracts. New York Times: $15 minimum wage for federal contractors will take effect Jan. 30 (https://www.nytimes.com/2021/11/22/business/economy/minimum-wage-federal-contractors.html) [by Noam Scheiber, 11/22/21] Employees of federal contractors will make at least $15 per hour under a final rule that the Labor Department announced Monday (https://www.dol.gov/newsroom/releases/whd/whd20211122) , providing a likely wage increase for over 300,000 workers, according to administration estimates. The wage floor will affect contracts that are executed or extended beginning on Jan. 30, 2022. The current minimum wage for contractor (https://www.nytimes.com/2021/04/27/business/economy/biden-minimum-wage-federal-contractors.html) s is $10.95 under a rule (https://obamawhitehouse.archives.gov/the-press-office/2014/02/12/executive-order-minimum-wage-contractors) enacted by the Obama administration in 2014 and is scheduled (https://www.dol.gov/agencies/whd/government-contracts/minimum-wage) to rise to $11.25 on Jan. 1. Both rules require that the minimum wage increase over time to account for inflation. [...] Administration officials said they did not expect the minimum wage increase to result in significant job losses or cost increases, contending that the higher wage would improve productivity and reduce turnover, providing employers and the government with greater value. MSNBC: Minimum wage for workers on new federal contracts will rise to $15 starting Jan. 30 (https://www.cnbc.com/2021/11/22/minimum-wage-for-workers-on-new-federal-contracts-will-rise-to-15-starting-jan-30-.html) [by Annie Nova, 11/22/21] Federal contractors will be guaranteed an hourly minimum wage of at least $15 in all new contracts with government agencies beginning on Jan. 30, 2022, the U.S. Department of Labor announced on Monday. President Joe Biden had signed the executive order lifting the hourly rate for federal contractors from $10.95 in April. The change is expected to impact some 327,000 workers, including food-service employees and nursing assistants who currently make less than $15 an hour. The order will also lead to the end of the tipped minimum wage for federal contractors, which is now $7.65 an hour, by 2024. Many workers will have to wait longer than January for the pay bump, however. The increased wage is a requirement only in new contracts, and therefore wont apply to workers on existing federal agreements, which can be three years or five years long. The Hill: $15 minimum wage for federal contractors will take effect on Jan. 30 (https://thehill.com/homenews/administration/582666-15-minimum-wage-for-federal-contractors-will-take-effect-on-jan-30) [By Alex Gangitano, 11/22/21] The Biden administrations rule increasing the minimum wage for federal contractors to $15 an hour will take effect Jan. 30 the Labor Department announced Monday. The rule will increase the minimum wage for all workers involved in covered federal contracts and applies to all 50 states and Washington, D.C. [...] [Federal contractors] build and repair the federal infrastructure, clean and maintain our national parks, monuments and other federal facilities, care for our veterans, and ensure federal workers and military service members are provided with safe and nutritious food, Labor Secretary Marty Walsh said in a statement on Monday. Implementing this Executive Order improves the economic security of these workers and their families, many of whom are women and people of color, he added. Bloomberg Law: Federal contractor pay of $15 per hour cemented by new DOL rule (https://news.bloomberglaw.com/daily-labor-report/federal-contractor-pay-of-15-per-hour-cemented-by-new-dol-rule) [by Ben Penn, 11/22/21] The Biden administration has locked in a regulation to raise minimum pay for federal contractor employees to $15 an hour on new or updated contracts starting Jan. 30. The U.S. Department of Labor published a final rule (https://aboutblaw.com/0zZ) Monday to carry out a policy goal President Joe Biden had set in an executive order earlier this year. The rule establishes the contours of how federal agencies will ensure that new or extended contracts are awarded only to companies paying workers a $15 minimum wage, a level that will be annually updated to keep pace with inflation. WSJ: Biden Administration to raise minimum wage to $15 an hour for federal contractors (https://www.wsj.com/articles/minimum-wage-for-federal-contractors-to-rise-to-15-an-hour-XXX-XXX-XXXX7) [by David Harrison, 11/22/2021] Federal contractors, including janitors, security guards, child-care workers who provide services to the government, will soon be paid a $15-an-hour minimum wage, the Labor Department said Monday. Starting Jan. 30, all new contracts or contract extensions will require the higher minimum wage, which will be indexed to inflation, the department said in announcing it had finalized a rule President Biden called for earlier this year. The rule would raise the minimum wage for contractors from $10.95 an hour. Most federal contracts last three to five years, according to the department. Labor Department officials say about 327,000 contractors could see higher wages under the rule. [...] The $15 hourly wage will also apply to outfitters and guides on federal land and to workers with disabilities, some of whom can currently be paid less than the minimum wage, the department said. The rule also eliminates the tipped minimum wage for federal contractors by 2024. CBS: About 300,000 workers to get a raise next year as higher minimum wage kicks in (https://www.cbsnews.com/news/federal-contractors-minimum-wage-15-an-hour-2022/) [By Irina Ivanova, 11/22/21] More than 300,000 maintenance, security and child care workers will get a raise starting next year under a new $15 an hour minimum wage for federal contractors, the Labor Department said Monday. The new compensation scheme stems from an April executive order by President Joe Biden that raises the pay of federal workers. The $15 baseline wage for federal contractors also will be indexed to inflation and rise in subsequent years. The new pay floor takes effect for any federal contract starting on or after January 30, 2022. Under the new rule, outfitters and guides on federal lands, as well as some workers with disabilities who can be paid less than the minimum wage, will have their pay raised to $15 an hour, labor officials said. [...] The rule applies to all employees of a business that has government contracts not only those who are working in federal buildings, officials said. The raise would affect about 327,000 workers who are now earning less than $15 per hour, said Jessica Loomen, acting administrator of the Labor Department's wage and hour division. Many of those employees work in security, building maintenance and child care. Newsweek: $15 minimum wage for federal contractors to start in January Here's who may see a raise (https://www.newsweek.com/15-minimum-wage-federal-contractors-start-january-heres-who-may-see-raise-1652079) [By Alexandra Hutzler, 11/22/21] Hundreds of thousands of employees could see a significant pay raise starting next year. The Department of Labor announced Monday that workers under federal contracts will be guaranteed to make at least $15 per hour starting on January 30, 2022. The rule applies to new contracts, as well as renewals and extensions of existing contracts, beginning on that date. Government Executive: Labor Dept issues final rule requiring federal contractors to pay $15 minimum wage (https://www.govexec.com/management/2021/11/labor-dept-issues-final-rule-requiring-federal-contractors-pay-15-minimum-wage/187014/) [Courtney Bubl, by 11/22/21] On Monday, the Biden administration announced its final rule directing federal contractors to pay their workers a $15 minimum wage starting next year. Therule (https://www.dol.gov/sites/dolgov/files/WHD/government-contracts/FR-Increasing-Minimum-Wage-Federal-Contractors.pdf) , promulgated by the Labor Department, follows adirective (https://www.govexec.com/management/2021/01/biden-aims-federal-contractors-pay-15-minimum-wage/171578/) from President Biden issued shortly after Inauguration Day and builds on a prior Obama-era regulation. After issuing a notice of proposed rulemaking in July, (https://www.govexec.com/management/2021/07/proposed-rule-requiring-federal-contractors-pay-15-minimum-wage-released/183955/) the department received about 245 comments from the public. No significant changes were made in the final rule from what was proposed, said Jessica Looman, acting administrator of the Labor Departments Wage and Hour Division, on a briefing call with reporters on Monday. ###