“Educating the Government Contracting Community”

White House Issues Executive Order Increasing Minimum Wage for Contractors

On February 12, 2014, the White House issued an executive order increasing the minimum wage to $10.10 per hour for work performed under Federal contracts. Per the Executive Order, the new minimum wage will apply to all solicitations for contracts issued on or after January 1, 2015. However, the White House “strongly encourage[s] [agencies] to take all steps that are reasonable and legally permissible to ensure that individuals working pursuant to those contracts and contract-like instruments are paid an hourly wage of at least $10.10…as of the effective date” of the Executive Order.

The minimum wage increase as announced in the Executive Order only applies to “contracts and contract-like instruments”—grants are specifically excluded from the scope of the Order. In addition, the Order requires Federal departments and agencies to include a clause specifically detailing this wage requirement in all contracts, subcontacts and other lower-tier subcontracts. Per the Order, federal regulations regarding this minimum wage increase should be issued by October 1, 2014. http://www.whitehouse.gov/the-press-office/2014/02/12/executive-order-minimum-wage-contractors

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