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Employment Law Blog: President Obama Raises Minimum Wage for Federal Contractors - February 25, 2014

On February 12, 2014 President Obama signed Executive Order 13658 requiring federal contractors to pay a minimum rate of pay of $10.10 per hour.  The new rate goes into effect for new contracts or “contract-like instruments” and replacement contracts entered into on or after January 1, 2015; however, the Order “strongly encourages” agencies to begin including the requirements in contracts entered into prior to January.  The new rate also applies to subcontractors but does not apply to grant recipients.  Several unanswered questions remain including what constitutes a “contract-like instrument” and whether federal contractors must apply the new minimum wage rate to all of its employees or only those working on a federal contract.   These and other questions will hopefully be answered in regulations to be issued by the Department of Labor by October 1, 2014.     If you have questions regarding your responsibilities as a federal contractor, please contact Susan Freed at (515) 246-7891 or