An Executive Order (E.O.) issued by President Obama in 2014, still in effect, requires certain federal contractors and subcontractors to pay a higher minimum wage than otherwise required under federal law to employees working on covered contracts. E.O. 13658 also contains an escalator clause requiring an annual upwards adjustment in the mandated hourly rate.
Pursuant to that clause, the U.S. Department of Labor (DOL), which enforces the E.O., announced recently that the contractor minimum wage will increase from $10.80 an hour to $10.95 an hour, effective January 1, 2021. The statutory federal minimum wage applicable to most other employers is $7.25 an hour, although a growing number of states have adopted a higher minimum wage.
In addition, for federal contractors covered by the E.O. with qualifying tipped employees, the minimum wage for these workers will go from $7.55 an hour to $7.65 an hour, also effective January 1, 2021.
Members of the Center for Workplace Compliance (CWC) can read more here.